Capps Slams AIG Execs

Nava Introduces Bill Nixing Bailout Funds as Bonuses

Representative Lois Capps said she was “disgusted” by the $165 million in bonuses paid out to top management of AIG, the imploding insurance giant that received $170 billion in federal bail-out funds. Capps termed the executive bonuses “deeply disturbing,” especially for a company that lost $61.6 billion in the fourth quarter of 2008. Capps applauded President Barack Obama’s pledge to exhaust every legal avenue to prevent AIG from paying those bonuses – which range in size from $1,000 to $5 million. It’s unclear how successful the Obama administration will be given that the bonuses were pledged as part of a contract that predates the company’s financial melt-down. AIG underwrote the insurance for many of the bundled mortgage loans that went belly-up with the collapse of the real estate market. Meanwhile, State Assemblymember Pedro Nava – and candidate for state attorney general – introduced a bill that would preclude any state-regulated financial institution from using federal bail-out funds for “excessive executive bonuses” or “to host lavish parties.”

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