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AIG sued by former staff for £124 million

AIG sued by former staff for £124 million

AIG sued by former staff for £124 million Insurance giant American International Group (AIG) was sued by former staff who claimed they were denied $100 million (approximately £124 million) in bonuses.

Details of the lawsuit, which was actually filed back in 2014, emerged in court in London on Friday, according to a Bloomberg report – with 23 analysts, managers and traders who worked at AIG Financial Products Corp., claiming they were denied deferred compensation because of “media and political pressure” relating to the US government’s bailout of the company.

The US Government had stepped in to save AIG back in 2008 after it came close to being brought down because of money-losing derivative bets. The bailout eventually reached $182.3 billion with the public expressing outrage when the company committed to paying out millions in retention awards in an effort to keep staff so they could help unwind trades.

“The claimants were part of an AIG business that lost billions of dollars in the financial crisis and yet they are now suing for deferred bonuses of more than $100 million,” AIG spokesman Jon Diat said in an email to Bloomberg. “We believe they have no rights under the deferred-compensation plan, which by its terms properly reduced their accounts as a result of their business’s massive losses.”

A statement from Stephenson Harwood LLP, which represents the only two employees identified in the court documents – Tobias Gruber, of Surrey, and Ilyas Kanaan of Beirut – outlines that the proceedings are linked to “failures to honour the contractual obligations owed to the claimants in accordance with employee-deferred compensation schemes.”

Speaking at the hearing, Judge William Blair remarked that the claim “is a very large one” and has scheduled a trial for January 2018.

AIG, meanwhile, argues that even if the employees’ claim is valid, it is subordinate to the other debts of the group.

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