Pay Czar Rejects AIG Pay Packages: Report

Kenneth Feinberg rejects much of the pay packages AIG presented for its top executives.
Author:
Publish date:

NEW YORK (

TheStreet

) --

American International Group

(AIG) - Get Report

isn't getting away with massive executive pay packages again -- not on Kenneth Feinberg's watch.

The Obama administration's Pay Czar rejected much of the pay packages for AIG's top employees, including those in the financial-products unit, the

Wall Street Journal

reported.

Feinberg said the compensation packages were inconsistent with "public interest." He said base salary shouldn't be more than $500,000 for the year, and approved salaries between $100,00 and $450,000, according to the

Journal

.

For those earning in this range, cash bonuses will be 91% lower than they were in 2008.

Feinberg also rejected AIG's bid to dole out more than $900,000 in perks and $1.5 million in "other" compensation to select employees. Instead, he said these employees should receive no more than $25,000 each in this type of pay.

But for all the restrictions Feinberg is demanding, there are some things he cannot seem to control. Employees in the financial-products unit may still receive bonuses that are due to be paid in 2010, and Feinberg said he could not persuade AIG to restructure retention bonuses ranging from $1.5 million to $2.4 million to three high-ranking executives, the

Journal

reported.

Executive compensation at AIG has been a cause for controversy. Earlier this month, it was discovered that

the flailing insurer paid more than $168 million to about 400 employees

between December 2008 and March 2009, right after it received a massive $85 billion loan from the government.

That pay included a now infamous $7,700 retention bonus for a kitchen aide.

-- Reported by Jeanine Poggi in New York

Follow TheStreet.com on

Twitter

and become a fan on

Facebook.

Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.