Insurance giant American International Group is being stung by criticism for using most of its government bailout package to pay employee bonuses. AIG is also facing demands from President Barack Obama to rescind or repay 165 million dollars in bonuses.
US President Barack Obama is angry that AIG has used 165 million US dollars of its government bailout package to pay bonuses to executives.
Speaking at the White House on Monday, Obama said it was hard to understand how AIG could justify the bonuses.
Obama says, "this is a corporation that finds itself in financial distress due to recklessness and greed. Under these circumstances, it's hard to understand how derivative traders at AIG (American International Group) warranted any bonuses, much less 165 (m) million dollars in extra pay. I mean, how do they justify this outrage to the taxpayers who are keeping the company afloat?"
Obama has told US Treasury Secretary Timothy Geither to pursue every single legal avenue to block the bonuses.
AIG announced on Sunday that bonuses would be paid to executives on Sunday. The company has received taxpayer bailouts totaling 173 billion US dollars over the past 6 months.
The bonuses are part of a large total payout, reportedly put at 450 million US dollars for 400 employees of AIG Financial Products, the unit that send insurer to brink of collapse.
It also was revealed over the weekend that AIG used more than 90 billion US dollars in federal aid to pay out foreign and domestic banks, some of whom had received their own multi-billion-dollar US government bailouts.
AIG reported this month that it had lost 61.7 billion US dollars in the 4th quarter last year, the largest corporate loss in history.
(CCTV March 18, 2009)
