AG coalition going after AIG bonuses

New Jersey Attorney General Anne Milgram said yesterday that her office is spearheading an investigation into the bonuses paid to workers’ at American International Group Inc.’s financial-products unit. Her office is looking into possible fraud under the state’s securities laws as well as other possible violations. “Specifically, we are investigating whether this compensation was paid to those working in the AIG subsidiary largely responsible for the financial crisis of the company,” Ms. Milgram wrote in a March 19 letter to Edward M. Liddy, chairman and chief executive of New York-based AIG. “We want to ensure the investing public, as was promised, that money received by the company is being utilized to improve the financial welfare of the company, not to pad the pockets of the same individuals who led to the financial crisis in the first place.” A slate of 18 other attorneys general also signed the letter, which gave Mr. Liddy five business days to release the names of all workers at the financial-products unit who had received bonuses since September. Along with the names of those individuals, Ms. Milgram also wants their titles, job responsibilities and amount of compensation, as well as the names, titles and contact information of the employees who approved the bonuses. She also called for Mr. Liddy to reveal whether Troubled Asset Relief Program funds were used for the compensation, as well as all documents related to communications with underwriters, broker-dealers, analysts and other institutions related to securities issued by AIG financial products and the unit’s financial health. The 18 states that signed the letter areArizona, Delaware, Illinois, Kentucky, Louisiana, Maine, Michigan, Mississippi, Montana, Nebraska, New Mexico, Ohio, Oklahoma, Oregon, Pennsylvania, Texas, Washington and West Virginia. Connecticut and New York are conducting their own investigations.