AIG to pay $450M in bonuses to retain 400 people who lost $34 billion

1/29/2009 3:05pm by 738

Everyone would be a heck of a lot better off if these people were shown the door rather than hugged and handed $1 million plus. Even now they continue to suggest that if they don’t pay millions to retain these valuable people, they will leave. Excuse me, but who the hell lost the $34 billion? Let. Them. Go. Now. (h/t Carlton)

American International Group Inc., the insurer saved from collapse by government money after losses on credit-default swaps, offered about $450 million in retention pay to employees of the unit that sold the derivatives, according to two people familiar with the situation.

About 400 workers at the financial products unit may get the money in two installments, said the people, who declined to be named because details of the payments were confidential. The business was responsible for about $34 billion in writedowns since 2007 as the market value of swaps AIG sold to banks plunged amid the subprime mortgage market collapse.

The payments bring to more than $1 billion the amount AIG has committed to keep its employees from leaving. The New York- based insurer in September took a federal bailout to avoid bankruptcy and is selling subsidiaries to repay the government. AIG said the program was disclosed before the government rescue, which is now valued at $150 billion.

This is another tired excuse, much like the Citi jet for $50 million. I don’t think anyone really cares whether or not this decision was made before, during or after the government bailout. The fact is the bailout changed everything so all bets are off. Had the government not stepped in, every one of these people would have nothing, so I don’t even want to hear about this excuse.

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An American in Paris, France. BA in History & Political Science from Ohio State. Provided consulting services to US software startups, launching new business overseas that have both IPO’d and sold to well-known global software companies. Currently launching a new cloud-based startup for the Microsoft market. Full bio here.

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