Government audit criticizes exec pay at GM, Ally, AIG after bailouts

by DAVID SHEPARDSON, Detroit News  |  published on January 30, 2013

government audit

A government auditor harshly criticized the Treasury Department for approving “excessive” pay packages for top executives at three companies that received large government bailouts.

Christy Romero, the special inspector general overseeing the $700 billion Troubled Asset Relief Program, criticized the Treasury for approving pay raises at General Motors Co., Ally Financial Inc. and American International Group Inc.

The report released Monday was critical of the Treasury’s special master overseeing executive pay at companies that got very large bailouts: Cash salaries of $450,000 or more were approved for 94 percent of the top 25 employees each at AIG, GM and Ally.

“While taxpayers struggle to overcome the recent financial crisis and look to the U.S. government to put a lid on compensation for executives of firms whose missteps nearly crippled the U.S. financial system, the U.S. Department of the Treasury continues to allow excessive executive pay,” the report said.

The executives at GM, Ally and AIG “continue to rake in Treasury-approved multimillion-dollar pay packages that often exceed guidelines” previously announced, the report said.

AIG repaid its government bailout in December and is no longer subject to the pay restrictions. Initially seven companies — including Chrysler Group LLC, Chrysler Financial, Citigroup Inc., and Bank of America — were covered by the restrictions.

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