AIG founder and former CEO Maurice “Hank” Greenberg has counter-sued 16 current and former company directors in response to a $US1 billion ($1.8 billion) suit filed against him by the insurance giant.

The claim against Mr Greenberg and former CFO Howard Smith is for losses stemming from charges brought by former New York Attorney-General (and now Governor) Eliot Spitzer.

In 2005, Mr Spitzer accused Mr Greenburg and Mr Smith of using reinsurance contracts and other financial devices to conceal losses from shareholders.

AIG’s board forced out Mr Greenberg in 2000, later writing off $US3.92 billion ($4.63 billion) in profits from 2000 through 2004. In February last year, AIG settled through $US1.64 billion ($1.93 billion) in fines and restitution.

Mr Greenburg says AIG’s actions are purely aimed at sheltering current directors and officers from the company’s past indiscretions. His lawyer, David Boies, says the counter-claims begin the process of “holding AIG’s current board and management accountable for their conduct”.

AIG says Mr Greenburg’s claims are “without merit”.