European AIG executives are not just handing back their controversial bonuses like their American counterparts. Instead, they are adamant that they should not have to return them, and explain that pressuring them to do so may amount to blackmail.

At a staff meeting for UK and Paris employees on Monday, AIG Financial Products unit head Gerald Pasciucco said that he thought that demanding repayments was "blackmail".

One employee at the meeting said:

"The vast majority of people in London have made the decision that the request is pretty offensive. It effectively constitutes blackmail whether it is criminal or not. There is no moral reason to give it back."

The employee said that Pasciucco recommended bonus recipients strongly consider returning their bonuses, but said that any decision was an individual choice.

Following the meeting, a compliance officer for the Banque AIG unit in London asked UK authorities from the Serious Organised Crime Agency (SOCA) to investigate whether demands to return the money could be considered extortion.

AIG spokesman Mark Herr said, however, that this concern "on the legality of the repayments or potential repayments was not shared by the company." SOCA is said to have given the go-ahead for repayments to go forward.

New York Attorney General Andrew Cuomo has been pressuring AIG, as well as other banks and companies that received government bailouts, on the issue of bonuses. He is investigating whether the AIG bonuses were paid fraudulently under NY law. Connecticut's attorney general has also subpoenaed 14 current and former AIG executives in an investigation of compensation and bonus practices.

Some AIG employees now face a tough decision: give back the money they believed they earned lawfully, or face the possibility that Cuomo could make their names public.

Cuomo said that earlier this week about $80 million of the $165 million in AIG bonuses were paid in the U.S., while the rest were given outside U.S. jurisdiction. He said at the time that 15 of 20 leading bonus recipients had agreed to return the money. Some are outside of the jurisdiction.