Greenberg faces civil charges over AIG reinsurance fraud
Just days after slamming AIG as “in crisis”, the insurer’s former CEO Maurice “Hank” Greenberg faces possible civil charges over a fraudulent reinsurance deal with General Re.
The US Securities and Exchange Commission has issued Mr Greenberg with a “Wells notice”, which details possible enforcement action and gives the recipient the chance to rebut charges.
The regulator took action following comments made in a trial of five former Gen Re and AIG executives by US District Judge Christopher Droney that there is “sufficient evidence” for Mr Greenberg’s involvement.
The executives were convicted late last month of conspiring over a fake reinsurance arrangement that inflated AIG’s loss reserves by $US500 million ($521 million) in 2000/01.
Mr Greenberg was forced to relinquish control of AIG in 2005 amid the Spitzer enquiry after almost four decades at the helm of the insurer.
But he has retained a sizeable influence on AIG through major shareholder CV Starr, and has hit out at the performance of the insurer’s board following AIG’s $US7.8 billion ($8.1 billion) net first-quarter loss.
The US Securities and Exchange Commission has issued Mr Greenberg with a “Wells notice”, which details possible enforcement action and gives the recipient the chance to rebut charges.
The regulator took action following comments made in a trial of five former Gen Re and AIG executives by US District Judge Christopher Droney that there is “sufficient evidence” for Mr Greenberg’s involvement.
The executives were convicted late last month of conspiring over a fake reinsurance arrangement that inflated AIG’s loss reserves by $US500 million ($521 million) in 2000/01.
Mr Greenberg was forced to relinquish control of AIG in 2005 amid the Spitzer enquiry after almost four decades at the helm of the insurer.
But he has retained a sizeable influence on AIG through major shareholder CV Starr, and has hit out at the performance of the insurer’s board following AIG’s $US7.8 billion ($8.1 billion) net first-quarter loss.