Andrew Cuomo (D)
NEW YORK (Legal Newsline)- American International Group Inc.'s board needs to stop generating "unwarranted and outrageous expenditures," New York Attorney General Andrew Cuomo demanded Wednesday.
The Democratic attorney general in a letter to the insurance giant also demanded that the company pay back past expenditures that were unreasonable.
In his letter to the company's board of directors, Cuomo cited a $5 million bonus and $15 million retirement package AIG gave to its former chief executive Martin Sullivan as well as expensive junkets it paid for its employees.
"In the last several months, as AIG was teetering toward bankruptcy, and operating with unreasonably small capital, AIG nevertheless made numerous extraordinary expenditures in the form of executive compensation payments, junkets and perks for its executives," Cuomo said.
Noting that such expenditures violated New York law, Cuomo demanded an accounting of AIG's executive compensation and benefits.
Last month, the federal government offered AIG an $85 billion loan. The company may access an additional $37.8 billion from the Federal Reserve Bank of New York to keep the company solvent.
"As you of course know, the taxpayers of this country are now supporting AIG through rescue financing, which makes such expenditures even more irresponsible and damaging," Cuomo said.
From Legal Newsline: Reach reporter Chris Rizo at email@example.com.