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U.S. Senator Seeks Details on AIG Exec’s Severance

By | January 19, 2010

A watchdog senator Friday asked the Obama administration pay czar to explain why a top AIG executive stands to get a multi-million dollar severance package.

Sen. Chuck Grassley sent a letter to pay czar Kenneth Feinberg asking him to explain why the executive, who resigned last year because of pay curbs at the bailed out insurer, may get a large payout.

Anastasia Kelly, AIG’s vice chairman for legal, human resources, corporate affairs and corporate communications, resigned effective Dec. 30 for “good reason” and is eligible for severance pay under the terms of the company’s executive severance plan, the insurer said.

Grassley, however, said severance packages are for involuntary separations, not willing exits.

“For me, and I am sure for taxpayers across America, the situation as reported surrounding Ms. Kelly and her severance is deeply troubling news,” Grassley, an Iowa Republican, said in a letter to Feinberg. “This is especially true in light of the already sordid record at AIG of paying massive executive bonuses with TARP taxpayer money.

News reports have put Kelly’s severance package at between $2.8 million and $3.8 million, Grassley said.

He asked for Feinberg to provide Kelly’s employee history, her salary information, a copy of the severance plan, and an explanation of any government attempts to modify the plan.

Kelly’s resignation comes after Feinberg, who is charged with monitoring pay levels at companies that received taxpayer funds, imposed pay caps for AIG’s top executives.

AIG had to be propped up with some $180 billion in taxpayer support after its near collapse in September 2008. The U.S. government now owns nearly 80 percent of the company, once the world’s largest insurer by market value.

An AIG spokeswoman couldn’t be reached immediately for comment. (Reporting by Karey Wutkowski; editing by Carol Bishopric)

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