And another one for the idiot anals of the Obama administration. After taking over the biggest nationalization in history (with the exception of the GSE's but those are a special case), and being paid to run a zombie bankrupt company instead of saving everyone a few dollars and packing it in, Robert Benmosche, who became CEO of AIG a mere three months ago, has threatened to quit in protest to stern governmental compensation oversight. At least Benmosche made some very powerful enemies during his short time in the hot seat, including the NY AG. Perhaps Ken Lewis will consider the corner office position once Mr. Benmosche returns to his palatial Croatian estate. Unless, of course, the lawsuit against the former BofA CEO does not go quite as well as expected. Ironically, running AIG out of a jail cell would be the crowning achievement of what the current version of capitalism is all about.
From the WSJ:
Last week, Mr. Benmosche and other AIG board members met with Mr. Feinberg in New York. During the three-hour meeting, board members discussed difficulties of complying with pay policies and retaining talent at the company. Mr. Benmosche's frustrations "hit a crescendo," said a person familiar with the matter. "Bob feels he is in an impossible situation," the person added. Mr. Benmosche didn't respond to a request for comment.
The move is likely to make a variety of HFT algos very unhappy, as these have been churning AIG's stock with the reckless abandon of trading a viable blue chip instead of the toxic husk of a bankrupt entity, which not only should not be paying its CEO even one nickel in compensation, but should be immediately entombed before it gobbles up even more taxpayer capital.
Were Mr. Benmosche to depart, the move could be highly disruptive. AIG is in a long-term battle to pay taxpayers back roughly $90 billion. It is trying to keep its businesses stable and its employees motivated while also laying plans to sell off big chunks of the company.
Who would have thought corporate communism could be so unrelenting.