According to Bloomberg, Citigroup paid 1,900 insurance brokers at its Primerica Financial Services unit a total of $5,000 each after it scrapped a trip to a Bahamas resort.
Primerica paid the agents, who are independent contractors, because they won a seven-month-long sales contest, the company said. "We were legally obligated to do so," Susan Thomson, a Citi Holdings spokeswoman said. Primerica and Smith Barney, both profitable businesses, are part of Citi Holdings, a new unit of Citigroup.
The $9.5 million payout came after Primerica canceled the Bahamas jaunt for its top-performing brokers after receiving $45 billion in government rescue funds.
In a related story, some 2,000 Smith Barney brokerage advisers got debit cards valued at $1,000, $2,000 and $3,000 for various canceled getaways for an additional $3.5 million in total compensation, the New York Post reported.