Governor Rell: AIG Subpoena
Will Be Delivered Today
Consumer Protection Commissioner Issues Subpoena for AIG
Contracts, Details on Employees in Effort to Void Bonuses
Governor M. Jodi Rell today announced that a subpoena for documents relating to the bonuses paid to AIG managers with federal bailout funds will be issued today by Commissioner Jerry Farrell, Jr. of the Department of Consumer Protection. An attorney for AIG has advised the Commissioner that he would accept service this afternoon.
The subpoena is for contract documents, employee names and titles, job descriptions and other employment information.
On Wednesday, the Governor ordered Commissioner Farrell to subpoena the employment contracts that AIG has cited to justify the bonuses to determine whether the payments can be voided under the Connecticut Unfair Trade Practices Act (CUTPA). Because AIG’s financial products subsidiary is located in Wilton, AIG cited Connecticut General Statutes Section 31-72 as obligating AIG to pay the bonuses.
“The company cited Connecticut law and they will be held to Connecticut law – all of it,” Governor Rell said. “Commissioner Farrell will use the information obtained by this subpoena to determine whether the AIG bonuses can be voided as ‘against public policy’ under CUTPA.
“The use of bailout funds – which really means taxpayer money – to pay employee bonuses was certainly not the ‘public policy’ Congress had in mind when it enacted the Troubled Asset Relief Program,” the Governor said. “Those funds were intended to stabilize our financial markets and restore the flow of credit to consumers. They were not intended to reward the very people responsible for dealing a death blow to the financial industry. We will use all legal means available to void the bonuses and recapture those taxpayer dollars.”
The Connecticut Unfair Trade Practices Act, codified as Connecticut General Statutes Section 42-110a, was enacted in 1973. The subpoena requires AIG to produce the documents by March 27.
A copy of the AIG subpoena is attached.
STATE OF CONNECTICUT
BEFORE THE COMMISSIONER OF CONSUMER PROTECTION
SUBPOENA DUCES TECUM
TO:
American International Group Financial Products Corp. Docket No. 09-353
50 Danbury Road
Wilton, Connecticut
GREETINGS
BY AUTHORITY OF THE STATE OF CONNECTICUT, and more particularly, pursuant to the authority granted to the Commissioner of the Department of Consumer Protection by virtue of Section 42-110d of the Connecticut General Statutes, you are hereby commanded to produce documents pertaining to American International Group, Inc. (hereinafter “AIG”) and its subsidiaries, including but not limited to American International Group Financial Products Corp. (hereinafter “AIG-FP”), and its 2008 Employee Retention Plan (hereinafter “Plan”). You are hereby commanded to produce: (1) copies of any and all contracts, including but not limited to the Confirmation and Acknowledgement, Schedule 1, between AIG or AIG-FP and individuals who were paid a Guaranteed Retention Award for the 2008 Compensation Year in accordance with the Plan, including dollar amounts paid; (2) a listing of names of each such individual, together with his or her position title and job description; for each, indicate whether they are a member of the Senior Management Team; (3) for each such individual, information concerning whether the employee is currently employed by AIG or AIG-FP; if no longer employed, the date of severance from employment; and (4) if any covered person received a Guaranteed Retention Award and returned any portion thereof to AIG or AIG-FP, a listing of such names and dollar amounts returned, as of the date of your response.
Said documents are to be produced and made available to the Commissioner of Consumer Protection or his authorized representative in Room 100, State Office Building, 165 Capitol Avenue, Hartford, Connecticut, on or before 4:30 p.m. on March 27, 2009 concerning the matter currently under investigation under the Unfair Trade Practices Act pertaining to AIG and AIG-FP. If you fail to obey the terms of this subpoena, appropriate relief shall be sought in accordance with Connecticut General Statutes, Section 42-110k.
HEREOF FAIL NOT, UNDER PENALTY OF LAW.
Dated at Hartford, Connecticut this 19th day of March, 2009.
Jerry Farrell, Jr.
Commissioner
Department of Consumer Protection
