AIG “employee retention” pay reaches $1 billion

American International Group offered $450 million “retention pay” to employees who lost billions on credit-default swaps.

That averages out to about $1 million-and-change per worker, for the 400 or so workers in the financial products unit.

Those are the very folks responsible for some $34 billion in write-downs since 2007, as market value of the swaps plunged amid the sub-prime mortgage market collapsed, Bloomberg reports.

That brings the grand total of AIG’s “employee retention payments” to more than $1 billion. The money is meant to keep workers from bailing – as if there were any place they could go.

AIG, of course, is the insurance giant alive thanks to a $150 billion lifeline from the federal government. Taxpayers now own 80 percent of the company.

LOCK THE SCOUNDRELS UP!

In other AIG news this week, a former vice president  was sentenced to four years in prison for defrauding shareholders – a relief for him, as he could have gotten a life term.

Christian Milton (left), 61, was convicted last year (along with four former execs of General Reinsurance Corp.) of using a sham transaction to help AIG improve its balance sheet. The fraud cost AIG shareholders as much as $597 million, Bloomberg reports.

U.S. District Judge Christopher Droney also imposed a $200,000 fine and two years of supervised release after Milton’s term ends.

(source:  http://taxdollars.freedomblogging.com/2009/01/29/aig-employee-retention-pay-reaches-1-billion/10086/)

Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit http://www.pinnacleproactive.com

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