Insurance holding company Genworth Financial Inc. and two units of the insurance company American International Group Inc. have received subpoenas from the Securities and Exchange Commission and the U.S. Justice Department.
Richmond, Va.-based Genworth said that one of its business units has received subpoenas from the SEC and DOJ. The company said they were related to “an investigation of bid-rigging involving guaranteed investment contracts sold to municipalities.”
AIG Financial Products received a subpoena from the Justice Department’s anti-trust division and a separate unit, SunAmerica, received a subpoena from the SEC, said AIG spokesman Chris Winans.
In recent days, several companies have received subpoenas related to an investigation of municipal guaranteed investment contracts, or GICs, by regulators. Municipal GICs are fixed-rate, fixed-maturity contracts that municipalities can buy, like bonds, but they are backed by an insurance company.
Genworth said it has not issued, and does not currently issue, GICs to municipalities, but that its “business unit provides administrative and management services to a third party that does.” The company said it will cooperate fully with the investigation.
The AIG spokesman couldn’t give details about the subpoenas, nor could he confirm whether they are related to the GICs investigation, but he said that SunAmerica is involved in issuing GICs.
According to Fitch Ratings, to date, companies that provide GICs and have disclosed receiving at least one subpoena include: Financial Security Assurance Holdings Ltd., parent of Financial Security Assurance Inc.; Financial Guaranty Insurance Co.; Security Capital Assurance Ltd., parent of XL Capital Assurance Inc.; and a subsidiary of XL Capital Ltd.
Topics AIG
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