NEW YORK (AP) – The New York state attorney general turned up the heat Wednesday on nine large bank giants benefiting from the Wall Street bailout to provide information on the calculations and sizes of their executive bonuses.

In letters to the boards of directors of Citigroup, Morgan Stanley and seven other banks, Andrew Cuomo said taxpayers have a right to know how their money is being spent.

“Taxpayers are, in many ways, now like shareholders of your company, and your firm has a responsibility to them,” Cuomo wrote.

The letters asked the boards to voluntarily turn over internal information describing how much money they plan to set aside for bonuses and how it will be distributed. The attorney general also wants to know if the bonus plans were adjusted after the bailout.

Earlier this month, Cuomo threatened to use state business laws to review and possibly rescind any inappropriate spending by American Insurance Group Inc. amid reports the company was still lavishing luxuries on executives while taking government money to stay afloat.

Cuomo’s approach with the banks was less aggressive: The letters cited no abuses, instead appealing to their boards to “step up to the plate and prevent wasteful expenditures of corporate funds on outsized executive bonuses and other unjustified compensation.”

Calls were made to Citigroup and Morgan Stanley seeking comment, but there was no immediate response.

On Tuesday, Rep. Henry Waxman, D-Calif., chairman of the House Oversight Committee, sent similar letters asking the nine banks getting a $125 billion infusion to detail what they are paying their executives and employees.

The requests followed an Associated Press report from last week that found that the nation’s biggest banks are preparing to pay their workers as much as last year or more, including bonuses tied to personal and company performance.

In total, the nine banks had pay-related costs of $108 billion for the first three quarters of the year. The average increase came to just shy of 3 percent, according to AP figures.

Those taking cash from the government must follow guidelines limiting executive pay, including a ban on golden parachutes for departing executives. No restrictions are placed on across-the-board pay.

The financial crisis, brought about by mountains of bad mortgage-related assets, caused banks to falter or fail and lending to dry up and prompted Congress to pass a $700 billion bailout package.

AP-ES-10-29-08 1713EDT


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