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-- Tax-payer funded AIG to give tens of millions in bonuses
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| Originally posted by jerZ07002 Anyway, try to stay on point! btw - just messin with you krypton.  |
Topic-related - who would've thought, that the amount of bonuses was actually slightly bigger. $218 million is a LOT of money for bonuses when a company is on a verge of bankruptcy. I wonder if they would have been able to pay out these bonuses without the taxpayer bailout. You see, as a private company they can pay out tens of millions in bonuses per person - I couldn't care less, but once the taxpayer money is involved to keep the company afloat - thats a different situation.
Focking greedy focks. Sorry to be so blatant about it. They are liars - lying about the amount of payouts, they are selfish, they are greedy. Fockers.
http://news.bbc.co.uk/2/hi/business/7956903.stm
quote:
AIG bonuses 'higher than thought'
AIG office building, New York
The US bailed out AIG, effectively judging it too large to fail
US insurance giant AIG paid out a total of $218m (�150m) in bonuses after accepting bail-out cash, according to a senior US official.
Documents obtained by Connecticut's attorney general showed AIG's payout was $53m, or 32%, more than was previously estimated.
Papers obtained by subpoena showed 73 people got more than $1m each while five received more than $4m.
The US has rescued AIG with a $170bn bail-out package since September 2008.
But revelations about the size of bonus payments made by the organisation since the bail-out was agreed have sparked a furious reaction among US lawmakers and the general public.
'Distasteful'
For much of the week the total amount AIG paid out in bonuses was reported at $165m.
But documents obtained by Richard Blumenthal, Attorney General of Connecticut, now appear to raise that figure by some 32%.
US lawmakers vote for bonus tax
Connecticut was among 19 states demanding that AIG reveal details of bonuses paid to executives, in an effort to begin recovering the funds.
AIG has made no comment on Mr Blumenthal's findings.
But Mr Blumenthal said on Saturday that large bonuses were "showered like confetti" on AIG employees.
He said the newly-revealed number would "further fuel the justified anger and revulsion that people feel", and he planned to ask AIG bosses to explain the discrepancies in bonus figures, AP reported.
"Unless the number can be explained, it will undercut any lingering rationale the company may have for these unjustified payments," Mr Blumenthal said.
Earlier this week US President Barack Obama described the bonus payments as an "outrage", before state legal figures and congressmen also weighed in.
Even AIG boss Edward Liddy - who underwent questioning by a congressional committee on the issue - has described them as "distasteful".
Reports from the US say that AIG executives are now living in fear of a violent public backlash.
Many are reported to have received death threats and have been advised to take extra security precautions even in areas around their homes.
Protesters are expected to drive past executives' homes on Saturday in an attempt to deliver letters highlighting the plight of ordinary families during the current recession.
http://www.nytimes.com/2009/03/25/o...25desantis.html
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Dear A.I.G., I Quit! The following is a letter sent on Tuesday by Jake DeSantis, an executive vice president of the American International Group�s financial products unit, to Edward M. Liddy, the chief executive of A.I.G. DEAR Mr. Liddy, It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context: I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in � or responsible for � the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage. After 12 months of hard work dismantling the company � during which A.I.G. reassured us many times we would be rewarded in March 2009 � we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself. I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down. You and I have never met or spoken to each other, so I�d like to tell you about myself. I was raised by schoolteachers working multiple jobs in a world of closing steel mills. My hard work earned me acceptance to M.I.T., and the institute�s generous financial aid enabled me to attend. I had fulfilled my American dream. I started at this company in 1998 as an equity trader, became the head of equity and commodity trading and, a couple of years before A.I.G.�s meltdown last September, was named the head of business development for commodities. Over this period the equity and commodity units were consistently profitable � in most years generating net profits of well over $100 million. Most recently, during the dismantling of A.I.G.-F.P., I was an integral player in the pending sale of its well-regarded commodity index business to UBS. As you know, business unit sales like this are crucial to A.I.G.�s effort to repay the American taxpayer. The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity � directly as well as indirectly with the rest of the taxpayers. I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country�s call and you are taking a tremendous beating for it. But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn�t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut. My guess is that in October, when you learned of these retention contracts, you realized that the employees of the financial products unit needed some incentive to stay and that the contracts, being both ethical and useful, should be left to stand. That�s probably why A.I.G. management assured us on three occasions during that month that the company would �live up to its commitment� to honor the contract guarantees. That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts �distasteful.� That may also be why you authorized the balance of the payments on March 13. At no time during the past six months that you have been leading A.I.G. did you ask us to revise, renegotiate or break these contracts � until several hours before your appearance last week before Congress. I think your initial decision to honor the contracts was both ethical and financially astute, but it seems to have been politically unwise. It�s now apparent that you either misunderstood the agreements that you had made � tacit or otherwise � with the Federal Reserve, the Treasury, various members of Congress and Attorney General Andrew Cuomo of New York, or were not strong enough to withstand the shifting political winds. You�ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust. As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house. Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.�s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.�s promises and are not inclined to return the money as a favor to you. The only real motivation that anyone at A.I.G.-F.P. now has is fear. Mr. Cuomo has threatened to �name and shame,� and his counterpart in Connecticut, Richard Blumenthal, has made similar threats � even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press. So what am I to do? There�s no easy answer. I know that because of hard work I have benefited more than most during the economic boom and have saved enough that my family is unlikely to suffer devastating losses during the current bust. Some might argue that members of my profession have been overpaid, and I wouldn�t disagree. That is why I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.�s or the federal government�s budget. Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need. On March 16 I received a payment from A.I.G. amounting to $742,006.40, after taxes. In light of the uncertainty over the ultimate taxation and legal status of this payment, the actual amount I donate may be less � in fact, it may end up being far less if the recent House bill raising the tax on the retention payments to 90 percent stands. Once all the money is donated, you will immediately receive a list of all recipients. This choice is right for me. I wish others at A.I.G.-F.P. luck finding peace with their difficult decision, and only hope their judgment is not clouded by fear. Mr. Liddy, I wish you success in your commitment to return the money extended by the American government, and luck with the continued unwinding of the company�s diverse businesses � especially those remaining credit default swaps. I�ll continue over the short term to help make sure no balls are dropped, but after what�s happened this past week I can�t remain much longer � there is too much bad blood. I�m not sure how you will greet my resignation, but at least Attorney General Blumenthal should be relieved that I�ll leave under my own power and will not need to be �shoved out the door.� Sincerely, Jake DeSantis |
does anyone need any more examples of Maxine Waters' unbelievable stupidity and arrogance?
the look on Geitner's face during this is priceless
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| Originally posted by Q5echo does anyone need any more examples of Maxine Waters' unbelievable stupidity and arrogance? the look on Geitner's face during this is priceless |
Did anyone read about Maxine's highly ethical lobbying for TARP funds for the minority run bank her husband sits on the board of?
And yeah, Groundhog--totally agree. The AIG bailout money went to cover their counterparty risk (at least in large part). Yet when it comes out that their counterparties might've actually been *gasp* other financial institutions--it just can't be right!
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| Originally posted by Shakka Did anyone read about Maxine's highly ethical lobbying for TARP funds for the minority run bank her husband sits on the board of? And yeah, Groundhog--totally agree. The AIG bailout money went to cover their counterparty risk (at least in large part). Yet when it comes out that their counterparties might've actually been *gasp* other financial institutions--it just can't be right! |
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| Originally posted by Groundhog Boy I mean, isn't every AIG policy holder a "counterparty?" Is it the lack of comprehension of the definition of the word that is the problem for the public? |
the NY Times published a resignation letter today from one of the AIG officials that was targeted by congress and the prez. He was working in the commodity and equity division of AIG FP and had nothing to do with AIG running into the ground. He was working on a salary of 1 dollar per year because of the guarantee (he thought he had) of being rewarded with his bonus for helping resuce the company from bankruptcy. Check it out:
| quote: |
| DEAR Mr. Liddy, It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context: I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in � or responsible for � the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage. After 12 months of hard work dismantling the company � during which A.I.G. reassured us many times we would be rewarded in March 2009 � we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself. I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down. You and I have never met or spoken to each other, so I�d like to tell you about myself. I was raised by schoolteachers working multiple jobs in a world of closing steel mills. My hard work earned me acceptance to M.I.T., and the institute�s generous financial aid enabled me to attend. I had fulfilled my American dream. I started at this company in 1998 as an equity trader, became the head of equity and commodity trading and, a couple of years before A.I.G.�s meltdown last September, was named the head of business development for commodities. Over this period the equity and commodity units were consistently profitable � in most years generating net profits of well over $100 million. Most recently, during the dismantling of A.I.G.-F.P., I was an integral player in the pending sale of its well-regarded commodity index business to UBS. As you know, business unit sales like this are crucial to A.I.G.�s effort to repay the American taxpayer. The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity � directly as well as indirectly with the rest of the taxpayers. I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country�s call and you are taking a tremendous beating for it. But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn�t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut. My guess is that in October, when you learned of these retention contracts, you realized that the employees of the financial products unit needed some incentive to stay and that the contracts, being both ethical and useful, should be left to stand. That�s probably why A.I.G. management assured us on three occasions during that month that the company would �live up to its commitment� to honor the contract guarantees. That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts �distasteful.� That may also be why you authorized the balance of the payments on March 13. At no time during the past six months that you have been leading A.I.G. did you ask us to revise, renegotiate or break these contracts � until several hours before your appearance last week before Congress. I think your initial decision to honor the contracts was both ethical and financially astute, but it seems to have been politically unwise. It�s now apparent that you either misunderstood the agreements that you had made � tacit or otherwise � with the Federal Reserve, the Treasury, various members of Congress and Attorney General Andrew Cuomo of New York, or were not strong enough to withstand the shifting political winds. You�ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust. As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house. Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.�s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.�s promises and are not inclined to return the money as a favor to you. The only real motivation that anyone at A.I.G.-F.P. now has is fear. Mr. Cuomo has threatened to �name and shame,� and his counterpart in Connecticut, Richard Blumenthal, has made similar threats � even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press. So what am I to do? There�s no easy answer. I know that because of hard work I have benefited more than most during the economic boom and have saved enough that my family is unlikely to suffer devastating losses during the current bust. Some might argue that members of my profession have been overpaid, and I wouldn�t disagree. That is why I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.�s or the federal government�s budget.Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need. On March 16 I received a payment from A.I.G. amounting to $742,006.40, after taxes. In light of the uncertainty over the ultimate taxation and legal status of this payment, the actual amount I donate may be less � in fact, it may end up being far less if the recent House bill raising the tax on the retention payments to 90 percent stands. Once all the money is donated, you will immediately receive a list of all recipients. This choice is right for me. I wish others at A.I.G.-F.P. luck finding peace with their difficult decision, and only hope their judgment is not clouded by fear. Mr. Liddy, I wish you success in your commitment to return the money extended by the American government, and luck with the continued unwinding of the company�s diverse businesses � especially those remaining credit default swaps. I�ll continue over the short term to help make sure no balls are dropped, but after what�s happened this past week I can�t remain much longer � there is too much bad blood. I�m not sure how you will greet my resignation, but at least Attorney General Blumenthal should be relieved that I�ll leave under my own power and will not need to be �shoved out the door.� Sincerely, Jake DeSantis |
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| Originally posted by The17sss the NY Times published a resignation letter today from one of the AIG officials that was targeted by congress and the prez. He was working in the commodity and equity division of AIG FP and had nothing to do with AIG running into the ground. He was working on a salary of 1 dollar per year because of the guarantee (he thought he had) of being rewarded with his bonus for helping resuce the company from bankruptcy. Check it out: http://www.nytimes.com/2009/03/25/o...gewanted=1&_r=2 I believe there are a finite number of people that are smart and capable upper eschelon business leaders in this world... and what I fear is that a lot of them are going to look to other countries to showcase their talents. |
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| Originally posted by Shakka Fucking amazing. Even more fucking amazing that I posted that on the previous page. |
I predict more resignations from major companies in the coming months as the dems continue their anti-profit crusade.
Atlas is shrugging.
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| Originally posted by The17sss HAHA!! holy shit man I blew right past that post. Sorry! |
Shakka is one of the people I agree with a lot. I'm more inclined to read the posts of those I don't agree with, looking for debates. 
| quote: |
| Originally posted by The17sss Shakka is one of the people I agree with a lot. I'm more inclined to read the posts of those I don't agree with, looking for debates. |
| quote: |
| Originally posted by The17sss the NY Times published a resignation letter today from one of the AIG officials that was targeted by congress and the prez. He was working in the commodity and equity division of AIG FP and had nothing to do with AIG running into the ground. He was working on a salary of 1 dollar per year because of the guarantee (he thought he had) of being rewarded with his bonus for helping resuce the company from bankruptcy. Check it out: http://www.nytimes.com/2009/03/25/o...gewanted=1&_r=2 I believe there are a finite number of people that are smart and capable upper eschelon business leaders in this world... and what I fear is that a lot of them are going to look to other countries to showcase their talents. |
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| * MARCH 25, 2009, 9:59 P.M. ET AIG Fights a Fire at Its Paris Unit Executives' Resignations Put Billions in Contracts at Risk of Default By LIZ RAPPAPORT, LIAM PLEVEN and CARRICK MOLLENKAMP Amid the flap over bonuses at American International Group Inc. two of the company's top managers in Paris have resigned. Their moves have left the giant insurer and officials scrambling to replace them to avoid an unlikely but expensive situation in which billions in AIG trading contracts could default. Representatives of the Federal Reserve, AIG's lead U.S. overseer, are talking with French regulators and AIG officials to deal with the consequences of a complicated legal scenario in which the departures of the managers in Banque AIG, a subsidiary of AIG's Financial Products unit, could trigger defaults in $234 billion of derivative transactions, according to people familiar with the situation and a document AIG provided to the U.S. Treasury. Defaults, by no means inevitable, could not only hurt AIG but also could force European banks involved in the trades to raise billions in capital to cushion potential losses, according to AIG documents. That is because the banks used Banque AIG to hedge the risk in some of the assets they own, allowing them to hold less capital against those assets, which could include securities such as mortgages and corporate debt. The executives at Paris-based Banque AIG, Mauro Gabriele and James Shephard, have resigned in recent days but have agreed to stay on for a transition, according to people familiar with the matter. In the wake of their resignations, AIG must replace them to the satisfaction of French banking regulators. If they don't, French regulators may appoint their own designee to manage the bank -- an outcome that could trigger defaults under the bank's derivative contracts. The private contracts say that a regulator's appointment of a manager constitutes a change in control, according to a person familiar with the matter; the provision is often included in derivative contracts where parties want to preserve a way out if something about their counterparties changes. Messrs. Gabriele and Shephard didn't respond to requests for comment. AIG said in a statement that the departing managers "have agreed to stay on to help ensure an orderly transition. They, AIG, and our stakeholders have been in communication with the regulatory authorities in France to discuss our plan to replace them." France's Commission Bancaire, the banking regulator, declined to comment. Regulators and the company are motivated to find a solution in Paris. AIG described the issues in a five-page white paper submitted to the U.S. Treasury Department earlier this month along with a letter about $165 million in retention payments the company made to employees in the financial-products unit, the unit responsible for the worst of AIG's woes. The company was rescued by the federal government in September. After a public outcry this month about the bonuses, employees were urged to return them, and now several have quit, according to AIG. The two departing managers at Banque AIG have offered to return their bonus payments, AIG says. In the white paper, AIG said it had legal obligations to make the retention payments, but it also discussed the "significant business ramifications" of failing to pay. AIG said that employees at the financial-products unit are needed to wind down and sell pieces of that business, which has $1.6 trillion in outstanding trades. Referring to the circumstances at Banque AIG, the company said that at a minimum, the "disruption associated with significant departures related to a failure to honor contractual obligations would require intensive interactions with regulators and other constituents (rating agencies, counterparties, etc.) to assure them of the ongoing viability of AIGFP as well as its commitment to honoring counterparty contracts and claims." The risk that the Banque AIG transactions would default if managers departed would represent an unexpected problem for what had been one of the AIG Financial Products businesses that hadn't run seriously aground in recent months, according to AIG securities filings. Banque AIG enabled AIG to generate revenue by helping European banks lower the amount of capital they are required to hold to protect against losses on assets such as mortgage and corporate loans. The bank was set up in the early 1990s, and was licensed by French banking regulators in early 1991. More recently, a Banque AIG branch has been located in London's Mayfair district along with the financial-products unit. In the event of a default, European banks that have done these trades with AIG could be forced to take back responsibility for billions of dollars in assets. That could require them to raise billions of dollars in capital, AIG has said. The deals worked like this, according to a Banc of America Securities-Merrill Lynch report and a person familiar with AIG's contracts: A European bank with a hypothetical $1 billion portfolio of assets could unload some of the risk by having AIG protect the top and largest layer, or tranche, against losses with insurance-like derivative contracts. The move greatly reduced the regulatory capital charge for AIG clients. In May 2007, a British executive in the financial-products office in London told investors: "For the European banks and the Asian banks, this is very much a regulatory capital arbitrage business. By structuring their businesses, whether it's their mortgage lending or their corporate loans into these sorts of trades and tranching the risk up, they're able to significantly reduce the capital they have to hold against their portfolios." |
I agree Groundhog. I believe they are actively stoking emotions as a strategy.... they want a perpetual crisis going on all the time in one facet or another so they can impose more government expansion and regulation. Let's not forgot Rahm's words of "never wanting to miss out on the opportunities that a good crisis provides." I think we're seeing the reality of what he meant.
yeah, AIG and wall street arent at all to blame for the problems we're having 
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| Originally posted by pkcRAISTLIN yeah, AIG and wall street arent at all to blame for the problems we're having |
| quote: |
| Originally posted by Shakka They're not? |
We just got an email from our CEO that we would be impacted by the bill currently sitting in the senate regarding bonuses. According to that bill, any company that received more than $100 million in tarp money (a paltry sum particularly since most major banks were required to take at least $5 billion), would be levied with a tax on bonuses over a certain amount of an additional 35% to the individual tax rate and an additional 35% to the company. If that bill passes, I will migrate to a European, Middle Eastern, or an Asian bank. Congress is just going to drive intellectual capital away from the institutions that need it the most.
This really is a witch hunt. What a shame. Hope it doesn't pass.
Hmmmmmmm
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