AIG Current Issues Pertaining to Business Law

AIG (American International Group Inc) has near recently been a mutual feature on American as well as international headlines following its possibility of going into elimination as a result of financial difficulties. The federal organisation bailout panoptic to the social club to help it in reviving its activities has also been a result of discussion.Following all these, issues related to business law have been a common occurrence as AIG fights legal battles and accusations from enraged customers demanding their investment monies. AIG has as a result lost clients, employees and business in general. This paper focuses on these and early(a) current events pertaining to business law at AIG.AnalysisAIG was recently faced with an economic downturn as a result of the current economic crisis. AIG is state to have made losses worth $62 one thousand thousand in the fourth quarter of 2008 (Sorkin, 11-14). As a result, it has not been able to compensation its credit dues on time.Cred itors are constantly knocking on AIGs doors to arrive at their money as they fear that the companionship could fail to pay them infra the current financial difficulties it is experiencing. AIG has resulted in selling its as scores in order to gibe its obligations to creditors and beginning 2008 it obtained bailout from the political relation.Following the governing bailout, AIG is no longer a wholly orphic company. The majority shares of AIG are now in the hands of the government accordingly it expects to receive more government control.AIG traded 79.9 pct of its shares for the federal government bailout. The government now possesses the rights to suspend dividends to the previously common and preferred stock.This is an indication that the company has ceased from being a fully private company to a nationalized one. It thusly owes the citizens who are represented by the government to operate profitably as well as repay the loan advanced by the government from the tax payers m oney.As a result of the government bailout, AIG has to adjust itself to the governments requirements and laws that have been set for companies obtaining bailout.For example, The House of Representatives passed a requirement that all companies receiving federal government bailout portentous $5 should pay 90 percent on bonuses given by companies. The companies must also operate with positive net value so that they can be able to pay up the loans advanced. If this is not so, the government will force companies that cannot pay up into liquidation Mich, 23-25).AIG has been under interrogatory following the handsome benefits that were issued to its more than 400 employees in the financial products section ranging between $1 million and 6.4 million. This follows the fact that AIG received $170 billion as federal government bailout which has necessitated investigations on how AIG was spending the taxpayers money.(Turkish Weekly, 22-29). The government owns 79.9 percent of AIG now and as a result the public is the major shareholder of the company and this is what has created a major uproar in the public closely AIGs activities. There are claims that the company is not taking its responsibilities towards shareholders in a serious manner.Edward Liddy, AIGs chief executive officer told the congress in March, 2009 that the company had asked the employees to return half of the bonuses received (Sorkin, 19-23). Further, he argued that the reason for the hefty bonuses was an campaign to retain employees in the financial products division.