When the going gets tough, the tough get going – on a taxpayer-subsidized vacation. And that’s exactly what the executives at insurance giant AIG did in September 2008, when they flew out for a relaxing vacation at the swanky St. Regis hotel in southern California. And boy, did they need it: Just six days earlier, AIG had received an $85 billion government bailout. Apparently they converted it into traveler’s checks.
To their credit, the AIG execs made the most of their trip, spending a whopping $440,000. The tab included $10,000 in bar bills, $1,400 in salon expenses and $23,000 at the spa, where they racked up thousands of frequent-rubber miles.
AIG’s Most Excellent Vacation hit the media in early October and was a PR disaster. The New York Daily News may have summed it up best with their headline: “AIG big shots get $500G vacations on taxpayers’ dime.” And when it was reported that rooms at the St. Regis ran up to $1,200 a night, one Congressman pointedly remarked, “That’s more than some of my constituents pay on a mortgage payment on homes they’re now losing.”
To their defense, AIG had planned the trip before the bailout. They also tipped generously, spending another $3,000 of (taxpayer) money. And whenever possible, they used a Groupon.
But give AIG credit for being consistent. Just three months before the bailout, they fired the CEO — and gave him a $15 million parachute. And in 2014, another AIG CEO sued the government, complaining that the bailout was not generous enough. Meanwhile, several other executives are still hoping for a lucrative movie deal offer from Oliver Stone.
All of which should help PR pros remember: You never want to have bad optics. But if you do, at least make sure your room has a nice view.