American International Group Inc., under pressure to limit executive compensation after a government bailout, froze pay and scrapped bonuses for seven top leaders and said chief executive officer Edward Liddy will get a $1 salary.
The insurer's next 50 highest-ranked executives will forgo pay raises through 2009, New York-based AIG said Tuesday in a statement. New York Attorney General Andrew Cuomo, who demanded last week that AIG disclose compensation plans, said the insurer took a "positive step" and called on other companies to follow.
Mr. Liddy is cutting costs after lawmakers and regulators criticized the insurer for bad bets that forced it to take a taxpayer rescue that was almost doubled this month, to more than $150 billion. AIG, crippled by losses tied to mortgages, follows Wall Street firm Goldman Sachs Group Inc. in limiting executive compensation after receiving commitments of capital from the government.
