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American International Group Inc. (ÌìÃÀÍøÕ¾´«Ã½´«Ã½) chairman and CEO Edward M. Liddy sent a letter today to U.S. Treasury Secretary Henry M. Paulson to clarify the circumstances of a business event held by an ÌìÃÀÍøÕ¾´«Ã½´«Ã½ subsidiary, discussed during an October 7, 2008 hearing by the House Committee on Oversight and Government Reform.

The event, mischaracterized as an “Executive Retreat,” was held by one of ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s insurance subsidiaries for independent life insurance agents, not for ÌìÃÀÍøÕ¾´«Ã½´«Ã½ employees. These agents were top business producers for the company, and of the more than 100 attendees, only 10 were employees of the ÌìÃÀÍøÕ¾´«Ã½´«Ã½ subsidiary who were there to represent their company. No ÌìÃÀÍøÕ¾´«Ã½´«Ã½ executives from headquarters attended. The meeting was planned months before the Federal Reserve Bank of New York’s loan to ÌìÃÀÍøÕ¾´«Ã½´«Ã½.

In his letter, Liddy assured Secretary Paulson that ÌìÃÀÍøÕ¾´«Ã½´«Ã½ now faces very different challenges, and “that we owe our employees and the American public new standards and approaches.” Liddy assured Secretary of the Treasury Paulson that ÌìÃÀÍøÕ¾´«Ã½´«Ã½ is “reevaluating the costs of all aspects of our operations in light of the new circumstances in which we are all operating.”

Liddy concluded, that “ÌìÃÀÍøÕ¾´«Ã½´«Ã½ is focused on doing what is necessary to address our capital structure, repay the Fed credit facility and emerge as a healthy global insurer. In the meantime, our insurance businesses continue to operate normally and satisfy the needs of our policy holders.”

Source: ÌìÃÀÍøÕ¾´«Ã½´«Ã½

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