Isakson Urges Treasury, Federal Reserve to Enforce Stronger Accountability on AIG

WASHINGTON – U.S. Senator Johnny Isakson, R-Ga., today sent a letter to Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke to convey his disgust at the behavior of the American International Group and demand stronger accountability in light of the government’s loan to the company.

The text of the letter is below:

I write to convey my absolute disgust toward the American International Group Inc. for spending nearly $440,000 on a lavish retreat just days after the federal government provided $85 billion in taxpayer dollars to shore up the company.  

This financial crisis has cost people their jobs and put small businesses at risk. It has ransacked individual retirement accounts and frozen the credit available for businesses, home purchases and car purchases. The people affected by our current financial situation are suffering and do not deserve to watch their hard earned taxpayer dollars spent on spa treatments and golf outings for AIG employees.  AIG should return the public’s money used for this retreat – every penny of it.

In addition, the recent announcement of the Federal Reserve exchanging up to $37.8 billion in securities from AIG in return for cash collateral also concerns me.  It is hard to feel sympathetic for a company that exercises such poor judgment.  Please ensure that the Treasury Department uses its full enforcement powers to prevent any misuse of taxpayer funds.

To make matters worse, the company is scheduled to hold another retreat in the coming weeks.  This is unacceptable and I urge the Treasury to enforce stronger accountability and impose stricter limits on compensation and perks.

Thank you for your consideration of my request.