New Jersey Attorney General Anne Milgram is leading a coalition of 19 states seeking answers concerning the millions of dollars in retention bonuses recently awarded by American International Group.

Anne Milgram

Milgram’s investigation will focus on possible fraud under the New Jersey Uniform Securities Law and other state regulations concerning the compensation to those in AIG‘s Financial Products division.

In a March 19 letter to AIG CEO Edward Liddy, Milgram gave the insurer five days to comply with a list of requests, including providing the names of all employees receiving bonus compensation dating back to September 2008, as well as the source of the compensation, copies of employee contracts of those receiving bonuses and whether federal money was used to compensate these executives.

On the same day Milgram and 18 other attorneys general sent the letter, New York Attorney General Andrew Cuomo announced that AIG had complied with a subpoena from his office for the list of AIG employees receiving retention bonuses.

In testimony before Congress March 18, Liddy read several threats addressed to him and AIG employees and feared public disclosure of the names of bonus recipients would put his employees in danger.

“We are aware of the security concerns of AIG employees, and we will be sensitive to those issues by doing a risk assessment before releasing any individual’s name,” Cuomo said in a statement. “The attorney general’s office is a law enforcement agency and is experienced in making these assessments.”

In addition to the names, Milgram’s coalition is also seeking a list of those linked to negotiating the compensation contracts, copies of board minutes, and copies of any correspondence to shareholders regarding the financial health of AIG from September 2008 to the present.

“We are investigating whether this compensation was paid to those working in the AIG subsidiary largely responsible for the financial crisis at the company,” Milgram said in the letter. “This crisis, in turn, resulted in the loss of billions of dollars in shareholder equity and necessitated a huge influx of taxpayer money. We want to ensure the investing public that money received by the company is being utilized to improve the financial welfare of the company, not pad the pockets of the same individuals who led to the financial crisis in the first place.”

The letter is supported by attorney generals in: Arizona, Delaware, Illinois, Kentucky, Louisiana, Maine, Michigan, Mississippi, Montana, Nebraska, New Mexico, Ohio, Oklahoma, Oregon, Pennsylvania, Texas, Washington, and West Virginia.