President Barack Obama vowed yesterday to pursue 'every single legal avenue' to block $165m (£117m) in bonus payments by AIG amid mounting anger over the stricken insurance group’s use of federal bail-out funds.

His remarks came as Andrew Cuomo, New York attorney-general, opened an investigation into the bonuses and threatened AIG with subpoenas to secure the names of employees who received the money.

Financial Times, New York Times