The once-mighty insurance giant has turned to a seasoned Washington crisis manager to repair its tattered reputation and help it weather the escalating public backlash. -- PHOTO: REUTERS
WASHINGTON - THEY took lavish junkets and paid bonuses to purveyors of exotic financial instruments.
AIG's lavish spending
WHILE working with Levick and receiving federal bailout money, AIG spent some US$440,000 on a posh retreat for executives at the exclusive St Regis Resort, Monarch Beach in Dana Point, California.
Then it went through with an US$86,000 partridge-hunting trip in the English countryside.
Now add this to the list of extras American International Group Inc has paid for while grasping a federal lifeline: The once-mighty insurance giant has turned to a seasoned Washington crisis manager to repair its tattered reputation and help it weather the escalating public backlash.
Levick Strategic Communications, first tapped by AIG last year, is known for coaching prominent players through the messiest of cases, from the Catholic Church's sex abuse scandal to the controversy surrounding a Dubai-based company's contract to run some US ports.
They're a player in a vibrant and lucrative cottage industry in the nation's capital - helping high-profile people and companies rescue their images after well-publicised missteps.
Now, as AIG faces congressional grillings and an enraged public, Levick is on the front lines, dispensing advice to embattled chief Edward Liddy. On Wednesday, Levick crisis adviser Michael W. Robinson was on hand in the packed Capitol Hill hearing room where Mr Liddy was peppered with questions from outraged lawmakers.
AIG hired Levick in June, according to a person with knowledge of the relationship who spoke on condition of anonymity.
Back then AIG was buffeted by a management shake-up, a federal probe and Wall Street downgrades, and its former CEO Maurice R. 'Hank' Greenberg had declared the company 'in crisis', saying it had lost credibility with investors.
People familiar with Levick and the business of crisis public relations estimate that AIG could have paid Levick a retainer of US$1 million (S$1.53 million) or more, although such work varies widely in price.
Herr sent The Associated Press a statement explaining that AIG has retained several outside public relations firms to help serve its needs as it restructures.
Those companies 'are helping to address in as timely a manner as possible the intense internal and external communications demands since AIG's financial crisis began', the statement said. The firms don't lobby, AIG added, and their costs 'are vastly offset by cuts in AIG's advertising and sponsorship activities'. -- AP
