AIG's Public Relations PR Debacle

It will be interesting to see how AIG's public relations department handles the company's latest scandal.

Rep. Ed Towns (D-NY), the chairman of the House Committee on Oversight and Government Reform, sent AIG CEO Edward Liddy a letter yesterday asking for all the details surrounding its rather extensive and likely expensive public relations efforts.

According to the letter, posted at TalkingPointsMemo.com, Towns was upset to learn that AIG had circulated a paper that discredited former AIG chief executive Hank Greenberg to the news media the eve of a hearing by his committee.

"I would be extremely disappointed to learn that any of the billions of taxpayer dollars invested to support AIG may have been diverted to finance a public relations campaign against critics of the AIG bailout. In my view, these allegations warrant further inquiry to ensure that Federal funds are not being misused."

Towns wants detailed information on AIG's relationship with the public relations firms Burson-Marsteller and Hill & Knowlton, as well as any other PR representatives. He also wants to know who authored the paper "The Greenberg Legacy" and who had a role in the distribution of it.

It's safe to assume that some PR folks are going to lose their contracts with AIG over this, and rightly so. AIG no longer has the rights of a private company, and Liddy should know this by now.

by Megan Barnett