Facing lawmakers' fury over massive executive bonuses, AIG revealed today where it shuttled most of its bailout money, the Wall Street Journal reports. About two-thirds of AIG's $173 billion bailout flowed straight to banks like Goldman Sachs and Société Générale—and other companies and municipalities—to pay for AIG's failed ventures in credit default swaps and securities lending.
On talk shows today, politicians vented their anger over $450 million in bonuses going to the AIG unit that nearly sank the company; another $750 million may reach other employees. "Something is terribly wrong with this picture," said Rep. Elijah Cummings. AIG has defended the bonuses, but another lawmaker said companies receiving tax dollars "have to play by a different set of rules." AIG is now 80% government-owned.