Some retention plan

Eleven American International Group Inc. employees who got "retention'' bonuses of $1 million or more last week no longer work there, New York Attorney General Andrew Cuomo reported.

AIG came under harsh criticism when it paid more than $160 million in bonuses to employees of its financial products division, whose activities contributed heavily to the company's near collapse.

AIG has received more than $170 billion in public money since October, as part of a rescue plan that gave the U.S. government an 80 percent stake in the company..

Cuomo said in a letter to Rep. Barney Frank, the head of the House Financial Services Committee, that his office had subpoenaed AIG for the names of the employees who received bonuses

Seventy three AIG employees got retention bonuses of $1 million or more, including the 11 who are no longer with the company, Cuomo said. Seven of the recipients got more than $4 million each, with the highest payout being $6.4 million.

Although AIG agreed not to make any bonus payments from its $600 million deferred compensation pool, it tapped a separate retention bonus pool for last week's payments.

AIG contended that the employees who got bonuses were vital to unwinding the financial products business, which marketed credit default swaps and other exotic and risky instruments.

Cuomo noted that AIG's unwillingness to identify those employees makes it impossible for outsiders to evaluate that claim, or to understand why money went to people who have left the company.

"Until we obtain the names of these individuals, it is impossible to determine when and why they left the firm and how it is that they received these payments,'' he said.

According to Cuomo's letter, 22 AIG employees got bonuses of $2 million or more, collecting $72 million between them. That amounts to more than 40 percent of the total payout.

AIG Chairman Edward M. Liddy said in a letter to Treasury Secretary Timothy F. Geithner that the company was contractually obligated to make the payments.

Liddy even argued that breaching the contracts could lead some of AIG's counterparties in trillions of dollars worth of financial transactions to declare the company in default, triggering even bigger economic claims that could doom it