AIG CEO Edward Liddy, testifying before Congress Wednesday, addressed one of the key questions surrounding the controversy over $165 million in executive bonuses at his company: When did government officials first learn of them?
The controversy surrounding bonuses at American International Group boiled over Wednesday when the company said it asked some employees to give the money back, but lawmakers said they remained troubled about how the bailed out insurer is being managed.
As the tide of outrage over AIG bonuses continued unabated Wednesday, a congressional committee became the epicenter of the issue as Edward Liddy, CEO and chairman of the troubled insurer, prepared to answer questions about executive bonuses.
Insurance giant AIG will have to return to the Treasury Department the $165 million it just paid out in executive bonuses, Treasury Secretary Timothy Geithner said Tuesday in a letter to congressional leaders.
Anger over $165 million in bonuses doled out to American International Group senior employees reached a fevered pitch on Monday, prompting the Obama administration to vow to recoup the money and a New York prosecutor to subpoena the firm for recipients' names.
White House officials and some members of Congress reacted strongly Sunday to news that insurance giant AIG had intended to pay out $165 million in bonuses and compensation. The company has received at least $170 billion in federal bailout money.
Troubled insurer American International Group got a reworked $152.5 billion deal from the federal government Monday, as the Federal Reserve and Treasury Department made significant changes to the terms of the company's original bailout.
Troubled insurer American International Group - recipient of a more than $100 billion U.S. government bailout - agreed Wednesday to freeze $19 million in payments to former chief executive Martin Sullivan.
The beleaguered insurance giant AIG announced plans Friday to hold onto its property and casualty insurance businesses, while selling off the rest of the company to pay its massive debt to the federal government.
Mary Alice and José Martín's bungalow survived Katrina - but got hit in June. That's when Allstate informed the couple that their home, a mile from the glistening Gulf of Mexico, would no longer be covered for windstorm or hail. "Here it is the middle of hurricane season," Mrs. Martín fumes. "Who in the world is going to sell me a windstorm policy right now?"
Faced with over $3 billion in claims from the barrage of hurricanes last year, Allstate is going on the defensive by pulling out of of high-risk markets as the industry prepares for increasingly severe hurricanes over the next two decades.
After facing a slew of insurance scandals, mounting catastrophe losses from Hurricane Katrina and the prospect of losing its terrorism insurance backstop, the insurance industry will hardly be sorry to bid adieu to 2005.
Allstate, the largest publicly traded homeowners and auto insurer in the U.S., said it plans to scale back its exposure to the Gulf Coast homeowner's market following the devastation of hurricanes Katrina and Rita this summer.