Two senior members of the House Financial Services Committee Monday asked the Treasury Department and the Federal Reserve System to ramp up efforts to oversee American International Group Inc.
The two lawmakers, Rep. Paul Kanjorski, D-Pa., and Joseph Crowley, D-N.Y., asked that, by the end of January, the Treasury Department and the Federal Reserve describe, in writing, the systems established for keeping tabs on AIG, New York, and the agencies’ efforts and plans to keep Congress informed of oversight activities.
Kanjorski and Crowley also asked Treasury officials to tell Congress how they are enforcing the executive compensation restrictions imposed on recipients of the federal Troubled Asset Relief Program funds.
The letter was sent to Treasury Secretary Henry Paulson Jr. and Federal Reserve Chairman Ben Bernanke.
Kanjorski is chairman of the House Financial Services Committee’s capital markets subcommittee.
He and Crowley contend that the Treasury and Fed have not monitored AIG effectively despite providing a $150 billion lifeline for AIG.
Kanjorski and Crowley have corresponded with AIG about executive retention bonuses and AIG’s move to shut and down non-qualified deferred compensation programs and pay out the account balances to the participants.
AIG has since changed its bonus arrangements and deferred comp plan termination arrangements.
“While we are pleased with AIG’s cooperative response to our inquiries, we are concerned with the oversight of AIG by the Treasury Department and the Federal Reserve,” Kanjorski and Crowley write. “We are struck by how minimal review and three phone calls from staff resulted in AIG’s decision to reduce its accelerated deferred compensation plan by $93 million.”