The big question is who pays? Close to another Billion Dollars so far (who knows what other liabilities lie ahead).Hopefully D & O will cover some, but not even close to this number.Does AIG get another bail-out? I hope the answer is no, but if the past is indicative of the future we know where AIG can get more money. Where does it stop? Three and a half more years to go for the opportunity for a new President, but only one and a half for a new Congress.
There was a good piece put out by the Huffington report back in April 2009 that listed many of AIG’s past sins. After reading that I remember thinking, “if the American public saw this list there would be an outcry against the government bailout of AIG.”
First of all, where the hell is the government getting all this money from? Gives new meaning to “ask and thou shall receive”! Who are these harmed investors the article speaks of? As a former AIG employee, a lot of my 401k money was tied up in AIG stocks etc. Where’s my check for INDEMNIFICATION? Somehow I don’t think I should be holding my breath & waiting by my mailbox for a check that’s never going to come…
Amen to that, Apple.
Me ?
I’m a Senior Citizen, & just a lowly holder of common stock.
Thanks to AIG and the REST of Wall Street, I couldn’t afford to retire to a cardboard box under the Gowanus Canal !
The company, which did not admit or deny the allegations, had repaid its ill-gotten gains, as well as penalties to the government. In 2007, a federal court authorized the SEC to establish a “fair fund” to distribute the money to harmed AIG investors.
so, what is going on? if they were accused in 2006 and then found guilty in 2007, why in the heck did the feds allow us to give them money? and then, they (AIG) had the audicity to have 2 huge retreats and then have to payout retention money.
the taxpayers need to get their money back or allow us to take a tax break on our next several years of income taxes. since you the fed decided to give our money away to a private industry, then you can rely on them to provide you any money you need to function — oh, i guess that means the congress and president will have to go w/o a paycheck for a bit! um..um… sounds like a good idea to me!
My understanding is that a major player in this class action suit were invetors in Great Britain. At least you would hope the money would remain in, and be spent in, the states. Is it just me or do the jail terms seem extremely light for these folks that have committed fraud causing millions and billions in damages? How is this any less worse than someone that holds up a bank for thousands of dollars and gets a much harsher jail term (because they used a weapon instead of deception)???
If my math is correct then the shareholders hurt in this will get $3,280 per investor? I’m sure there are more than 257,000 investors out there, so how did they pick them. Friends first, Politicians second and lastly individuals that donate money to politicians? Give me a break!!
Article: AIG & General Re Insurance Executives Found Guilty Of Fraud and Conspiracy
Five executives, one from American International Group, Inc. (AIG) and four from General Re Corporation (Gen Re), were found guilty of fraud and conspiracy and face prison sentences and hundreds of millions dollars in fines.
Details of the case
The case stems from a 2005 civil lawsuit filed by New York Governor Elliot Spitzer, then the Attorney General of the state, against former AIG executives Maurice Greenberg and Howard Smith for improper accounting, bid rigging and other charges. AIG agreed to pay $1.6 billion to settle the civil matter. However, criminal charges were then filed against five additional AIG and Gen Re insurance executives.
The five were accused of inflating AIG’s loss reserves, a key indicator of a company’s financial health, through sham reinsurance transactions, by $500 million ($250 million in the fourth quarter of 2000 and another $250 million in the first quarter of 2001). These inflated reserves led insurance analysts and AIG’s investors to believe that the company was in better financial shape than it actually was – which led to an increase in its stock.
U.S. Department of Justice
According to a press release on the U.S. Department of Justice’s website:
The government presented evidence at trial that showed that each of the defendants knew that the true purpose of the transactions was to permit AIG to falsely report increasing loss reserves in its statements to analysts and investors and its filings with the Securities and Exchange Commission (SEC). The defendants structured a sham reinsurance transaction and created a phony paper trail to make it appear as though Gen Re had solicited reinsurance from AIG when the evidence demonstrated that the parties knew AIG wanted the transaction to manipulate its financial statements.
Additionally, the defendants entered into a secret side deal whereby AIG would never have to pay any losses under the contracts; AIG would return to Gen Re the $10 million in premiums Gen Re paid to AIG and AIG paid Gen Re a $5 million fee for entering into the transaction.
The five were convicted of all 16 charges brought against them – including conspiracy, securities fraud, mail fraud and lying to the SEC. Each of the five defendants face prison time and four of the five face fines of up to $46 million, the other $29.5 million. Their sentencing is in May 2008.
Where is this money comimg from, AIG, the federal government or Hank?
Who pays? You and I the taxpayer. Who is going to pay me for the loss in my investments because of the fraud in the government?
The big question is who pays? Close to another Billion Dollars so far (who knows what other liabilities lie ahead).Hopefully D & O will cover some, but not even close to this number.Does AIG get another bail-out? I hope the answer is no, but if the past is indicative of the future we know where AIG can get more money. Where does it stop? Three and a half more years to go for the opportunity for a new President, but only one and a half for a new Congress.
There was a good piece put out by the Huffington report back in April 2009 that listed many of AIG’s past sins. After reading that I remember thinking, “if the American public saw this list there would be an outcry against the government bailout of AIG.”
The report can be found at:
http://www.huffingtonpost.com/2009/03/24/aig-fraud-history_n_178545.html
Very frustrating. Add the recent $843M to the pot.
First of all, where the hell is the government getting all this money from? Gives new meaning to “ask and thou shall receive”! Who are these harmed investors the article speaks of? As a former AIG employee, a lot of my 401k money was tied up in AIG stocks etc. Where’s my check for INDEMNIFICATION? Somehow I don’t think I should be holding my breath & waiting by my mailbox for a check that’s never going to come…
Amen to that, Apple.
Me ?
I’m a Senior Citizen, & just a lowly holder of common stock.
Thanks to AIG and the REST of Wall Street, I couldn’t afford to retire to a cardboard box under the Gowanus Canal !
The company, which did not admit or deny the allegations, had repaid its ill-gotten gains, as well as penalties to the government. In 2007, a federal court authorized the SEC to establish a “fair fund” to distribute the money to harmed AIG investors.
See above, copied and pasted from the article.
That really stinks. Lots of luck to you!
so, what is going on? if they were accused in 2006 and then found guilty in 2007, why in the heck did the feds allow us to give them money? and then, they (AIG) had the audicity to have 2 huge retreats and then have to payout retention money.
the taxpayers need to get their money back or allow us to take a tax break on our next several years of income taxes. since you the fed decided to give our money away to a private industry, then you can rely on them to provide you any money you need to function — oh, i guess that means the congress and president will have to go w/o a paycheck for a bit! um..um… sounds like a good idea to me!
My understanding is that a major player in this class action suit were invetors in Great Britain. At least you would hope the money would remain in, and be spent in, the states. Is it just me or do the jail terms seem extremely light for these folks that have committed fraud causing millions and billions in damages? How is this any less worse than someone that holds up a bank for thousands of dollars and gets a much harsher jail term (because they used a weapon instead of deception)???
If my math is correct then the shareholders hurt in this will get $3,280 per investor? I’m sure there are more than 257,000 investors out there, so how did they pick them. Friends first, Politicians second and lastly individuals that donate money to politicians? Give me a break!!
Article: AIG & General Re Insurance Executives Found Guilty Of Fraud and Conspiracy
Five executives, one from American International Group, Inc. (AIG) and four from General Re Corporation (Gen Re), were found guilty of fraud and conspiracy and face prison sentences and hundreds of millions dollars in fines.
Details of the case
The case stems from a 2005 civil lawsuit filed by New York Governor Elliot Spitzer, then the Attorney General of the state, against former AIG executives Maurice Greenberg and Howard Smith for improper accounting, bid rigging and other charges. AIG agreed to pay $1.6 billion to settle the civil matter. However, criminal charges were then filed against five additional AIG and Gen Re insurance executives.
The five were accused of inflating AIG’s loss reserves, a key indicator of a company’s financial health, through sham reinsurance transactions, by $500 million ($250 million in the fourth quarter of 2000 and another $250 million in the first quarter of 2001). These inflated reserves led insurance analysts and AIG’s investors to believe that the company was in better financial shape than it actually was – which led to an increase in its stock.
U.S. Department of Justice
According to a press release on the U.S. Department of Justice’s website:
The government presented evidence at trial that showed that each of the defendants knew that the true purpose of the transactions was to permit AIG to falsely report increasing loss reserves in its statements to analysts and investors and its filings with the Securities and Exchange Commission (SEC). The defendants structured a sham reinsurance transaction and created a phony paper trail to make it appear as though Gen Re had solicited reinsurance from AIG when the evidence demonstrated that the parties knew AIG wanted the transaction to manipulate its financial statements.
Additionally, the defendants entered into a secret side deal whereby AIG would never have to pay any losses under the contracts; AIG would return to Gen Re the $10 million in premiums Gen Re paid to AIG and AIG paid Gen Re a $5 million fee for entering into the transaction.
To view the press release, go to: http://www.usdoj.gov/opa/pr/2008/February/80_crm_141.html
The five were convicted of all 16 charges brought against them – including conspiracy, securities fraud, mail fraud and lying to the SEC. Each of the five defendants face prison time and four of the five face fines of up to $46 million, the other $29.5 million. Their sentencing is in May 2008.