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Supreme Court rejects AIG ex-CEO Hank Greenberg’s bid to escape civil fraud charges

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The U.S. Supreme Court on Monday rejected former American International Group CEO Maurice “Hank” Greenberg’s bid to escape civil fraud charges in New York accusing him of orchestrating sham transactions at the insurer.

The justices left in place a June ruling by the New York Court of Appeals that his trial on charges brought by the New York Attorney General’s Office could proceed. The non-jury trial of Greenberg, 91, started in September. He has already testified in his own defense.

But the parties agreed at the end of November to put the trial on hold until January while they enter into mediation aimed at resolving the case.

Greenberg’s lawyers declined to comment on the Supreme Court action. A spokesman for New York Attorney General Eric Schneiderman had no immediate comment.

Greenberg led the New York-based insurance giant for four decades before he was ousted in 2005. The following year, AIG paid $1.64 billion to settle federal and state probes into its business practices.

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He has asserted that the case should have been over in 2013 when a $115 million settlement with AIG shareholders over improper accounting received court approval. New York was forced to drop its damages claims because of that decision.

Justice Charles Ramos of New York state court in Manhattan is presiding over Greenberg’s trial, and in September began directly questioning Greenberg.

The appeals court also ruled in June that the state could seek to recoup from Greenberg and co-defendant Howard Smith, AIG’s former chief financial officer, tens of millions of dollars in bonuses and interest covering the 2000-2005 period when the alleged fraud occurred. More than $55 million may be at stake.

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In addition, the court said the state could seek to ban Greenberg and Smith from the securities industry and from serving as officers or directors of public companies.

Greenberg currently is chairman and CEO of CV Starr & Co, a private insurance company. Smith is its vice chairman of finance.

AIG was rescued by the U.S. government in September 2008 to stave off bankruptcy after the company ran up billions of dollars in losses stemming from insurance it wrote on shoddy mortgage securities.

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The case was brought under the Martin Act, the 1921 New York law that former New York Attorney General Eliot Spitzer revived in the early 2000s to go after major financial institutions. In November, Schneiderman raised concerns that President-elect Donald Trump would seek to weaken the state law.

At issue are two transactions, the first concerning General Re, a unit of Warren Buffett’s Berkshire Hathaway. The suit claims Greenberg orchestrated a $500 million transaction that boosted loss reserves without transferring risk.

The second transaction, with Capco Reinsurance Co, allegedly hid a $210 million underwriting loss in an auto-warranty program.

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(Reporting by Lawrence Hurley. Additional reporting by Karen Freifeld; Editing by Will Dunham)


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Trump’s racism is ‘disqualifying’ for him to remain as president: former White House lawyer

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Former acting Solicitor General Neal Katyal explained on MSNBC on Thursday why he viewed President Donald Trump's racist attacks on four women of color in Congress as disqualifying.

Anchor Brian Williams read a quote from Susan Glasser of The New Yorker.

"Half of the country is appalled but not really sure how to combat him; the other half is cheering, or at least averting its gaze. This is what a political civil war looks like, with words, for now, as weapons," Glasser wrote.

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Lawrence O’Donnell reports on the growing movement for the impeachment of President Donald Trump

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Anchor Lawrence O'Donnell reported on the growing movement for the impeachment of President Donald Trump during Thursday evening's "The Last Word" on MSNBC.

"The House of Representatives conducted a symbolic vote on a hastily written impeachment resolution by Democratic Congressman Al Green in reaction to the president’s tweeted comments that the House of Representatives voted to condemn as racist," O'Donnell reported. "The impeachment resolution had nothing to do with the [Robert] Mueller investigation and referred only to the president being unfit for office because of the language that he has used recently about members of Congress and immigrants and asylum seekers."

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Video proves how far the Trump’s GOP has gone from the era of Ronald Reagan and HW Bush

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The immigration policies of Donald Trump’s presidency would have no room for his GOP predecessors Ronald Reagan or George H.W. Bush—who both embraced work visas, family unification, easy border crossings and a better relationship with Mexico.

That counterpoint can be seen in a very short video clip from the 1980 presidential election where Reagan and Bush—who became Reagan’s vice president for two terms before winning the presidency in 1988—were asked about immigration at a campaign debate in Texas. Their responses show just how far to the right the Republican Party’s current leader, President Trump, and voters who have not left the GOP to become self-described political independents, have moved on immigration.

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