President George W. Bush's administration specifically contemplated paying bonuses to American International Group Inc. employees in its November agreement to provide federal bailout funds to the insurance giant, the inspector general for the Troubled Asset Relief Program said today.
Neil Barofsky testified before the House Ways and Means oversight subcommittee. The panel is holding a hearing on the TARP program, which so far has spent $300 billion trying to reverse the financial meltdown.
The TARP contract between AIG and Treasury specifically contemplated the payment of bonuses and retention payments to AIG employees, including AIGs senior partners, Barofsky said.
The insurer has received $173 billion in federal bailout funds and is now 80 percent owned by the government.
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