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Friday, May 27, 2005

NY officials file suit against AIG
Krista-Ann Staley at 10:31 AM ET

[JURIST] Citing a pattern of fraud at American International Group Inc. [official website], the world's largest insurer by market value, New York Attorney General Eliot Spitzer has filed suit against AIG, its former chief executive, Maurice "Hank" Greenberg [Wikipedia profile], and its former chief financial officer, Howard Smith. The lawsuit, filed in New York Supreme Court Thursday, alleges the defendants engaged in fraudulent transactions to prop up the price of AIG stock, concealed losses, mischaracterized income and repeatedly lied to state insurance inspectors. The suit also suggests that Greenberg and Smith may have manipulated the stock for their own financial benefit. The complaint did not include any claims unknown to AIG and the company announced that they were "pleased that Attorney General Spitzer has recognized our cooperation and has previously indicated his expectations of reaching a civil settlement with AIG." Greenberg resigned from his positions as chief executive officer and chairman of AIG in March and Smith was fired about a week later for failing to cooperate with investigators. AP has more.






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