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High-flying AIG subsidiary gets to play with Uncle Sam’s dough, too
November 11th, 2008, 7:30 am · 9 Comments · posted by Teri Sforza, Register staff writer
When we told you that American International Group’s aircraft-leasing subsidiary threw a chi-chi party for 820 people in Washington D.C. just four days after the federal bailout, AIG officials assured us that the subsidiary did not use any government money. It was healthy, didn’t get any of the bailout money or spend it on said lavish party, etc.
What do you know? AIG’s aircraft-leasing unit, International Lease Finance Corp., recently got the go-ahead to issue up to $5.7 billion of commercial paper through the U.S. Federal Reserve. As of October 30 it 
had issued about $1.7 billion, and planned to use proceeds to repay inter-company loans from AIG. Read more about the deal in the News Daily story here.
AIG - crippled by bad mortgage bets - is scrambling to sell off parts of its business to repay government loans totaling $150 billion. Selling ILFC will help repay that debt.
The company has come under fire for lavish spending in the wake of the bailout. The Watchdog awaits Friday with bated breath; that’s when AIG must deliver an exhaustive inventory of potentially mortifying documents to the powerful Congressional Committee on Government Oversight. Included, we hope, will be the bills for the party for 820 at the Smithsonian’s Air and Space Museum.
We will go on record with our guess: The bill for the Smithsonian weekend will dwarf the $443,344 spent on the weekend at the St. Regis Monarch Beach Resort.
(The most recent junket to take folks’ breath away: a $343,000 event at a posh resort in Phoenix last weekend - which was mostly covered by underwriters, the company said, but where AIG’s logo was forbidden.)
More Watchdog:
- Should feds have let AIG go bankrupt?
- Bailed-out banks ordered to reveal executive compensation
- Oops. That $123 billion may not be enough, AIG says
- AIG suspends controversial executive payouts worth millions
- Invisible sponsor of OC wine event: AIG
- AIG calls off lobbyists, cancels events totalling $80 million
- Truth or dare? AIG ordered to bare all its secrets
- AIG’s “outrageous expenditures” cause more trouble
- AIG subsidiary parties in style in OC, two weeks after bailout
- AIG’s St. Regis blowout bill: $443,344
- Saturday Night Live skewers AIG excesses
- Obama on AIG’s $400,000 party: ‘Fire the scoundrels!’
- Yet another AIG subsidiary parties hearty days after bailout
- Cartoon zinger lampoons AIG bailout
- Prez didn’t push for bailout so execs could get facials
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Unbelievable
You write this as if AIG did something wrong when a profitable AIG subsidiary kept a previously made commitment to its employees and customers.
How that is wrong?
Hi Ken,
I’ll have a party at the Regis for about a 100, you care to pick up that bill?
I asume not, and why not? Because it is your money and you don’t know me.
And that’s exactly the reason AIG went wrong, because they used yours and a lot of others money (our taxes) to have a huge party.
So how can you defend that that is correct behaviour after they mismanaged all their money on ‘bets’ but expected you to bail them out?
How that is wrong?! Your a GENIUS pal! Great grammar, to go along with your moronic comment . You probably work for AIG, ya jerk! If a company asks to be bailed out, they should really be hurting financially. When expensive, and not to forget lavish, previously made commitments, exceed a companies current economic budget…..these previously made expensive commitments need to be canceled. If they need government money to survive as a company, they sure as hell don’t need over the top, expensive parties, to pat themselves on the back!
The problem, Ken, is that they held up a commitment on the taxpayers dime. I can guarantee they would have found a way to cancel this event if they were paying for it out of their own pocket.
I understand that this is one of the times that the maxim “You have to spend money to make money” is true as they are a service oriented company, but at the same time there is a problem of going overboard. I am sure that everyone can remember Enron’s executive vacations that they used to take, and this just seems to remind us all of that. The only difference here is that the government, not the shareholders, are paying for it.
Good news! Investigative reporters are still investigating vs. publishing opinionated bias ridden “news”! It is good to note that newspapers are doing their job! Regarding AIG. What IS with these guys anyway? Fatcat arrogance toward the “working stiffs”.
Ur Daddy: Before you go off criticizing others’ grammar, you should check your own.
I just got a letter from my insurer for my truck, 21st Century Insurance Co. saying my insurance was past due, so I called up to find out how much I owed.
The automated voice said AIG, and at first I thought I heard it wrong, but it turns out that AIG bought / merged with 21st.
I’m not going to insure my truck with a company that is associated with AIG, screw that.
I’ll look into AAA, or some other companies.
Fitch Report: http://www.alacrastore.com/storecont…47880_pr_frame
Bailout money should only go to companies that have a sensible plan for use of the funds. These companies should eliminate bonuses to executives due to poor performance and these lavish offsite events should be cancelled until bailout funds are repaid. Why is it that workers get laid off when the executives that make company decisions and policy continue to rape these companies and the US taxpayer and they aren’t held accountable for their actions? The corporate model doesn’t work anymore and there needs to be fixed with executive compensation limits enforced.