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Member, Beacon International Group, Ltd.
NEW YORK (Bloomberg)—Joseph Cassano, whose derivative bets on subprime mortgages drove American International Group Inc. into a U.S. bailout, was paid more than $40 million in 2003 and in 2006.
Mr. Cassano’s net cash compensation at New York-based AIG was $44.6 million in 2003, according to a document released by the Financial Crisis Inquiry Commission on its website.
Mr. Cassano stepped down in 2008 after the company reported a $5.29 billion quarterly loss fueled by credit default swaps from his unit protecting investors against losses on mortgage-linked securities. The FCIC has said financial firms were uninformed about the risk of derivatives and that soaring pay on Wall Street encouraged reckless trades.
“When clarity mattered most, Wall Street and Washington were flying blind,” FCIC Chairman Phil Angelides said in June. “In the case of derivatives, my fellow commissioners and I are seeing something we’ve seen many times in our investigation: enormous risk, reckless leverage, and early warning signs being ignored.”
AIG was bailed out in September 2008 in a rescue that swelled to $182.3 billion. Mr. Cassano’s net cash compensation in 2006 was $43.7 million, the FCIC document shows. The total in the eight years through 2007 was about $280 million, a figure previously reported by U.S. Rep. Henry Waxman, D-Calif.
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