Ohio Attorney General Jim Petro has filed suit against former American International Group Inc. CEO Maurice R. “Hank” Greenberg and his wife, Corinne P. Greenberg, in order to put a hold on the transfer of more than 41 million shares of AIG common stock from CEO Greenberg to his wife as a “gift” two days before he stepped down as CEO. The market value of those shares at the date of transfer was more than $2.6 billion.
“We are seeking to stop this suspect transaction of a large block of stock and put it under the control of a receiver until the end of the case,” Petro said. “This action by the Ohio pension funds represents a new chapter in our vigorous efforts to obtain compensation for investors as well as to institute appropriate corporate governance reforms at AIG.”
This new suit is related to the securities class action, which Petro is already prosecuting on behalf of the Ohio Public Employees Retirement System, the State Teachers Retirement System of Ohio and the Ohio Police and Fire Pension Fund and AIG investors. It was filed in United States Federal Court for the Southern District of New York, in New York City.
The new action is brought under the New York Fraudulent Conveyance Statute and seeks to both annul the transfer of the shares to Mrs. Greenberg as well as to appoint a receiver who will retain custody of the shares until the end of the class action lawsuit.
According to the Securities and Exchange Commission, Mr. Greenberg transferred more than 41 million shares of AIG common stock to his wife on March 11. This gift was made after he was named as a defendant in the class action suit.
Petro has retained Hahn Loeser & Parks LLP, which has offices in Cleveland and Columbus and is associated with Goodkind Labaton Rudoff & Sucharow LLP in New York City to assist him in representing the Ohio funds.