After days of uncertainty and intense negotiations, state officials announced this afternoon that a senior AIG executive will testify Thursday in front of the legislature’s banks committee to discuss the bonuses received by some of company’s employees.
Stephen L. Blake, AIG’s head of human resources, will appear at the hearing and provide testimony related to the $218 million bonus payments received by employees at the company’s Financial Products Unit, which has an office in Wilton.
AIG paid out the bonuses — despite receiving billions of dollars in federal bailout money-claiming that it was obligated too under Connecticut’s law on employee contracts.
“This agreement provides an important first step in the process,” Attorney General Richard Blumenthal said in an interview today. “The hearing will focus on the compensation system used by AIG, particularly how the bonuses and other payouts are structured.”
State Sen. Bob Duff (D-Norwalk) and Rep. Ryan Barry (D-Manchester), co-chairs of the banks committee, with Blumenthal issued subpoenas last week commanding 14 AIG employees including CEO Edward M. Liddy to appear at the legislative hearing.
As part of the compromise, Blumenthal said none of those individuals will testify tomorrow, but that he anticipates “they will be available if they have information to provide.”
In a statement to HBJ, AIG spokesman Mark Herr wrote: “Consistent with AIG’s cooperation with the Congress, federal authorities and the New York Attorney General, AIG will appear at tomorrow’s hearing before the Banks Committee. AIG’s employees continue to serve the American taxpayer by working diligently to wind down AIG’s $1.6 trillion business portfolio and to repay of the federal government’s investment.”
