AIG has been warned it must eventually reimburse the $165 million in bonuses it intends to pay staff to the US taxpayer if it is to receive any further bailout funds.
The insurer, the world's largest, has provoked ire stateside after insisting it was legally obliged to payout the bonuses despite already receiving $173 billion in government bailouts.
Treasury secretary Timothy Geithner said on Tuesday he would take "aggressive efforts" to recover the bonuses.
In a
letter to Congressional leaders Mr Geithner said: "We will impose on AIG a contractual commitment to pay the treasury from the operations of the company the amount of the retention awards just paid.
"We... want to ensure that taxpayers are compensated for any monies we cannot recover," he said.
New legislation to compel AIG to return the bonuses is expected to be put before Capitol Hill later this week.
Barack Obama had told a news conference earlier this week that he was "choked up with anger" at the bonus issue, which echoes problems faced by the British government over bonuses at Royal Bank of Scotland.
"Under these circumstances, it's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay," the US president said.
"How do they justify this outrage to the taxpayers who are keeping the company afloat?"
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