There’s no doubt that many of the employees at AIG’s toxic financial products unit feel betrayed by almost everyone involved.
They feel betrayed by AIG, by the US government, by Andrew Cuomo, and by the former leaders of their unit who created the trades that resulted in uncountable losses for the company.
We’ve been relatively unsympathetic, noting that many Americans have found themselves in the position of working for a company that goes broke. Most of those Americans, however, weren’t working for a company deemed systemically important so they just lost their jobs. At AIG it was different: employees at the insolvent company kept their jobs and many got paid huge bonuses, money that was culled from taxpayers whose companies aren’t insolvent.
We may have been too unsympathetic. Many AIGers feel the company and the government cut a deal with them last fall, telling them that if they stayed on they could be paid handsomely. This might have been a mistake, even an outrage, but it was an outrage in which the government was complicit. And perhaps going back on the deal afterwards isn’t fair.
That’s the argument made by Flakyak, which appears to be the pen name for Jan Ellen Harriman. Her husband, Paul Harriman, is an executive director of Banque AIG, the French banking unit under AIG FP. His job was mostly in IT, as far as we can tell. But this put him in close contact with the guy who ran AIG FP, Joe Cassano.
Flakyak describes Paul’s years there as “15 years of being on call every hour of every day of every week of every year.” She writes that “Joe Cassano is a bully” who regularly screamed at employees in public.
“Joe Cassano betrayed us,” she writes. “The CDO business was his. The other businesses were profitable and still are. When the executive in charge of risk challenged him he was told to shut up. When it blew up Joe walked around the office, looking at people who had worked loyally for him (no choice there if you wanted to stay) and took home $1,000,000 per month, knowing that those around him were going to lose their savings and more. We have.”
Here’s her full story:
Once upon a time my husband, working as a contractor from Digital, helped move the offices of FP from Manhattan to Westport, CT. When he came home to Vermont he was glowing with satisfaction of a difficult job well done and the pleasure of having worked with so many committed and intelligent people. I said “Wow, I wonder what it would take to work for them?”
I got one answer then.
When the CEO left with most of the IT department, the contractors who had worked on the move were the heroes who came to the rescue. And my husband was hired.
Thus began 15 years of being on call every hour of every day of every week of every year.
Never getting to read the boys a bedtime story without the phone ringing from Hong Kong or Tokyo or London or Paris because the mail server was down or someone couldn’t log on to their office machine from home or….
Eating at his desk with a phone to his ear – at dinner – at home.
And that was in Connecticut where we had bought a modest home and were able to save most of the ‘bonus’.
Then Joe Cassano asked us to go to London. My only questions were When and How!
Little did I know he was moving over and would use my husband as his chief geek and whipping boy for the next 10 years.
My husband was held accountable by Cassano for other people’s performance but never given direct authority over them, screamed at in public (as were most employees who had to encounter Joe) if any fault was found. Systems must never fail or there must be an instant correction and explanation and preventative measures put in place for the future – or else. That someone else beyond his control had made the error was never allowed as an explanation.
Some how my husband managed to get most of the others in the department to work with him.
Fortunately these challenges were a joy. But the lack of authority or promotion or respect were not. Especially when one person was hired to work in London who set out to undermine what trust there was between Cassano and my husband. This cost us most of our year’s ‘bonus’ and lowered the level of rises for the next 3 years.
Joe Cassano is a bully. I wanted very much to like the person who made our amazing London adventure possible but it was not going to happen.
Sent to London on a 2 to 3 year commitment, half a house left in storage in CT, we have been here ‘indefinitely’ for 11 years pushing 12. We were unable to press for anything more than the ex-pat package we were given at the beginning and lost even housing support after the first 5 years.
Our housing costs rose to 5 times what we paid in Connecticut. The salary did not.
Raises were only given in the ‘bonus’. So imagine having to pay 5 times your mortgage or rent on your current salary with the promise of the rest of your compensation to come once a year, in December. How do you leave that job?
Do you leave in December and disrupt your children’s education? Well, not without a very good reason.
Do you leave at the end of the school year and essentially throw away 6 months of under compensated work? Not likely.
– Oh and, a percentage of your paycheck you will be forced to ‘re-invest’ in the company for 5 years before you will see it.
It is a very pretty velvet lined cage with a megalomaniac holding the key.
It was ok while the company was ok. I was familiar enough with the way the deals worked and the internal as well as external oversight to be willing to stay in the cage in order to try to save enough to be able to send the boys to university some day. – like the ordinary tax paying citizens we happen to be.
FP had ridden through some heavy weather. While rogue traders took down other banks, I knew of the peer review of the trades and the transparency that would keep that from happening at FP.
When one rogue did get in and began setting up false deals with fake companies it was my husband who pulled together all the evidence that was used to remove him and keep him from ever getting another trading job.
I had many reasons to trust that, though I was having to do most of the utility parenting and keep the world ticking over for the family while he spent all hours working, we would come out of the long hard road with money for the boys education and a retirement fund that would allow my husband to have time to do the things he loves.
Then Joe Cassano betrayed us. The CDO business was his. The other businesses were profitable and still are. When the executive in charge of risk challenged him he was told to shut up. When it blew up Joe walked around the office, looking at people who had worked loyally for him (no choice there if you wanted to stay) and took home $1,000,000 per month, knowing that those around him were going to lose their savings and more. We have.
Ok, it was a huge blow but the government stepped in and my husband still had a job for now. But the description had changed.
Since January 2008 he has been working with Congressional auditors and investigators and the FBI to compile evidence on the deals and dealings of the people responsible, most particularly Joe Cassano.
Then the government and AIG parent lied to us. My husband had been asked to, and signed an agreement to stay for the next 2 years. In October we were told that all the prior compensation we had been forced to ‘re-invest’ in AIG was gone and would never ever be paid to us EVER no matter whether the company ever made any more money ever again.
It was a body blow. It was what we had worked 15 years for. It was our children’s education, our retirement, the down payment on a house (we own nothing). Can you feel it? That’s the draining away of hope.
But one bone was thrown – we were assured that the ‘retention payments’ (remember we’re still on a 15 year old salary that’s never risen so this is actually the bulk of our annual compensation)
would be paid.
Assured by Cuomo, the Federal Government and Liddy, the CEO of AIG. So he went back to work for another 6 months.
They paid us part in December – I suppose I should have smelled a rat, but that’s that 20/20 hindsight thing. It was nice, we’d planned on no Christmas as we didn’t expect the money until March. So the boys got to pick out something they really wanted and we had a nice Christmas.
The year before they had moved our payment from December to March. Yes, we had budgeted for 12 months and it suddenly turned into 15. Could you do that? Go 3 months without getting paid. Amazingly we managed.
We waited worried that the March payment might not come, despite the assurances. We counted the days until the transfer was to be made, checking the FX rate, wondering what the final number would be that we would live on and try to rebuild the children’s education fund with – retirement fund will have to wait.
And then our government betrayed us, painted us as thieves and threw our co-workers in Connecticut to the mob. No one ever approached anyone at FP to re-negotiate those contracts and everyone currently screaming about them knew what they contained in October if not in January.
And now Cuomo says that the security of our families can be purchased by returning the compensation we had been promised with his re-assurance in October. He is no better than a highwayman waiving a gun “Your money or your lives.”
Now I know what it would take for my husband to work AIGFP.