American International Group Inc. decided to hold back some of the bonuses originally scheduled to be paid to dozens of senior managers on July 15.
George Madison, the nominee to be U.S. Treasury general counsel, disclosed this in a public statement as an answer to questions from Iowa Sen. Charles Grassley, reports Reuters. Madison's information was correct, confirmed a source close to the matter.
Amidst public uproar, bonus payments were due for about 40 senior AIG executives last week for their 2008 performance. In total, the group was awarded about $9 million, to be paid in installments in 2009, contingent on certain targets related to AIG's restructuring.
In total, AIG last year agreed to pay more than $1 billion in retention payments and performance bonuses to employees.
Although AIG declined to comment, sources say the bonuses were not paid last week because AIG is still working with Washington compensation czar Kenneth Feinberg on a number of issues.
President Obama appointed Feinberg last month to oversee the compensation of top executives at AIG and six other firms that have received large federal bailouts.
AIG is reviewing its compensation plans with Washington as it tries to avoid a repeat of the nationwide outrage last March when the company paid $165 million in retention bonuses to employees of a financial products unit. Roughly half of AIG's $99 billion in losses last year stemmed from derivatives written by that unit.
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