New Jersey leads group of 19 states in AIG probe

NEW YORK (Reuters) - New Jersey on Thursday said it was leading a 19-state coalition demanding insurer American International Group release details of its bonuses to prevent the insurer from enriching individuals who helped cause the financial crisis.

New Jersey Attorney General Anne Milgram said in a statement that the group wrote AIG Chairman Edward Liddy seeking the names of everyone paid bonuses from September 2008 to the present. She added that the letter also demands "the source of the compensation, copies of the employment contracts of individuals who received bonuses, and whether federal money was used to compensate executives."

New York's attorney general earlier on Thursday said AIG had complied with his subpoena for details about the bonuses, but New York is not one of the 19 states in Milgram's group.

New York Democratic Attorney General Andrew Cuomo has also been working closely with congressional leaders in trying to get back bonuses paid by AIG and investment bank Merrill Lynch.

Also left off New Jersey's list is Connecticut where Republican Governor Jodi Rell has said Connecticut will pursue "all legal means available to void the bonuses and recapture taxpayer dollars." AIG's money-losing financial products arm is based in Wilton, Connecticut.

New Jersey's attorney general, who is appointed by the governor, said, "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."

States have often joined together in probes and sometimes jousted over who will lead. This occurred in the fight to win restitution for investors in auction rate securities, for example.

New Jersey's other AIG coalition members are: Arizona, Delaware, Illinois, Kentucky, Louisiana, Maine, Michigan, Mississippi, Montana, Nebraska, New Mexico, Ohio, Oklahoma, Oregon, Pennsylvania, Texas, Washington, and West Virginia.

(Reporting by Joan Gralla; additional reporting by Karen Pierog in Chicago and Grant McCool in New York; Editing by Kenneth Barry)