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Fact v. Fiction: Murphy Backed AIG Bonus Package

Here’s how Scott Murphy scammed the system to reward executives who lost millions.

1. In 2007, as a corporate board member, Murphy approved BIG CASH BONUSES to executives who LOST $1.6 million.
2. Now Murphy supports legislation that allows over $160 million in taxpayer money to go to bonuses for AIG executives
3. Murphy still supports the legislation….even with the AIG loophole….

The Fred Dicker Show, 03/20/2009
Murphy: No, I don’t have any regrets about saying I would vote for the stimulus.

WMHT-TIMES UNION DEBATE, 3/19/09
MODERATOR: “But the stimulus, even with that provision in it, even with the exemption provision in it, is it still a worthy bill?”

MURPHY: “Absolutely”

 

FACT: “…The rules in the stimulus bill apply not only to companies that receive bailout funds in the future, but also to those that have received TARP money in the past – although executive bonuses doled out in contracts signed before February 11 would not be impacted.” [1]

FICTION: “The reason bonuses were exempted before Feb. 11 is because they weren't prohibited under the Bush administration's bailout plan, Murphy said. ‘He (Tedisco) just doesn't understand what's going on,’ he said.”[2]

FACT: “The provision was stripped out during the closed-door conference negotiations involving House and Senate leaders and the White House. A measure by Sen. Chris Dodd, D-Conn., to limit executive compensation replaced it. But Dodd's measure explicitly exempted bonuses agreed to prior to the passage of the stimulus bill. Here's the exact language from Dodd's measure in the stimulus: ‘The prohibition required under clause (i) shall not be construed to prohibit any bonus payment required to be paid pursuant to a written employment contract executed on or before February 11, 2009...’”[3]

FICTION: “Murphy, 39, says the stimulus doesn't protect companies like AIG, but the bailout package passed under former President Bush lacked protections to avoid these type of bonuses.” [4]

FACT: “While the Senate was constructing the $787 billion stimulus last month, Dodd added an executive-compensation restriction to the bill. That amendment provides an “exception for contractually obligated bonuses agreed on before Feb. 11, 2009” -- which exempts the very AIG bonuses Dodd and others are now seeking to tax. The amendment made it into the final version of the bill, and is law.”[5]

Footnotes

[1]

(Carol E. Lee, “Dodd banker pay cap one-ups Obama,” Politico, 2/14/09)

[2]

(Maury Thompson, “Candidates spar over stimulus,” Glens Falls Post Star, 3/18/09)

[3]

(Jonathan Karl, “How Congress Protected AIG's Bonuses,” ABC News, 03/17/09)

[4]

(Valerie Bauman, “AIG bonuses creep into NY Congressional race,” Associated Press, 3/17/09)

[5]

(Rich Edson, “Amid AIG Furor, Dodd Tries to Undo Bonus Protections He Put In,” FOX Business, 3/17/09)