AIG CEO regrets sharp criticism of Cuomo

BELGRADE Tue Sep 1, 2009 3:58pm BST

The new CEO of American International Group Inc Robert Benmosche speaks during an interview with Reuters in the garden of his Adriatic seafront villa in Dubrovnik, Croatia, August 26, 2009. REUTERS/Nikola Solic

The new CEO of American International Group Inc Robert Benmosche speaks during an interview with Reuters in the garden of his Adriatic seafront villa in Dubrovnik, Croatia, August 26, 2009.

Credit: Reuters/Nikola Solic

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BELGRADE (Reuters) - Robert Benmosche, the new CEO of American International Group Inc (AIG.N), said he regrets tough comments he made about New York's attorney general, saying he was trying to bolster a demoralized AIG work force.

"You can characterize me as a goon or you can characterize me as somebody who is attempting to deal with a complex issue of a very demoralized employee force and said those things to them in confidence to reassure them that they no longer have to be afraid that they are going to be attacked again," Benmosche told Reuters in an interview on Tuesday.

During a closed-door staff meeting in Houston, Texas, last month, Benmosche said New York Attorney General Andrew Cuomo "doesn't deserve to be in government" and had acted like a "criminal."

Cuomo's office declined to comment on the incident or on Benmosche's subsequent comments.

In March, New York's top lawman issued subpoenas following news that AIG had paid $169 million in bonuses to employees in its money-losing financial products division. The payments sparked congressional and public outrage, as AIG has received more than $180 billion of federal aid.

Cuomo sought details about the bonuses, including the names of those who received them, the amounts, and details of employee contracts. His office has not made the data public.

"I was responding to several questions from the audience (in Houston) about their enormous fear for their well-being and their families, and it brought back a very dark period of time for AIG and its employees," Benmosche said by cell phone from the Adriatic Croatian city of Dubrovnik, where he owns a villa.

"They were afraid that the bonus issue may come back again, and it was dealing with their fear, and I think I overstated myself. I was a little too aggressive in my comments, but I was responding to enormous fear on the part of many, many associates."

AGGRESSIVE LEADERSHIP

Benmosche, a former CEO of MetLife Inc (MET.N) and a native New Yorker, prides himself on a reputation for toughness.

"One should not misconstrue my aggressive comments -- which were aggressive," he said in the interview. "But, on the other hand, I think the government understands that I said what I said.

"I said I would be aggressive before I came on board, and this is going to require strong, aggressive leadership to get this company righted and be able to make good on all of our obligations," he continued. "They need an aggressive person.

"But one should not assume that my aggressiveness is disrespect."

Benmosche said he had apologized to Cuomo's office, but added he had not received any complaints from the government, which now owns a 79.9 percent stake in AIG, once the world's largest insurer.

"Let me stress that in no way has anybody from the government ever complained to me about anything," he said. "It really is me complaining about me."

In the past, Benmosche has said he developed a scrappy, can-do approach after his father died young, leaving his mother to pay off a large debt on a family hotel in a Catskills resort town in New York.

"I was outspoken when I first got there and people wanted to know what kind of leader I will be," he said of the Houston meeting. "Going forward, my goal is to let the company know, and its employees, that we have to perform and there is hope here."

Benmosche became CEO on August 10. Before leaving in mid-August to oversee the grape harvest near his villa in Dubrovnik, he held several town hall-style meetings with AIG workers. At those sessions, many workers expressed fears about their future.

"The questions came out of a meeting in Texas -- which you would think is pretty far removed from AIG in New York -- and they had a lot of fear in Texas, they had a lot of fear in California," he said. "So it was, you know, 'Give us some hope and tell us you are going to speak for us.' That was the reason for it."

Given the intense public scrutiny of AIG, Benmosche said he would have to be more careful about his comments in the future.

"If there is anybody critical of Bob it is Bob," he said, referring to himself in the third person. "And Bob has to recognize that when he is having private meetings, that occasionally somebody is going to want to tape it and allow the press to get things I said in private, and that's unfortunate. I have to be aware of that."

(Reporting by Adam Tanner; additional reporting by Lilla Zuill;editing by John Wallace)

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