Ohio Attorney General Mike DeWine said U.S. District Court Judge Deborah A. Batts’ approval of a $725 million securities class action settlement against American International Group Inc (AIG) and certain individual directors and officers, which clears the way for three Ohio pension funds and countless Ohio shareholders to recover money.
“Ohioans and Ohio retirees’ retirement accounts took a hit when AIG was accused of widespread misconduct,” said DeWine.
The final settlement approval out of the Southern District of New York resolves allegations of AIG accounting fraud, collusion, and stock price manipulation from Oct. 28, 1999, to April 1, 2005. Three Ohio public fund pensions – Ohio Public Employees Retirement System, State Teachers Retirement System of Ohio, and Ohio Police and Fire Pension Fund (the Ohio Funds) – led the class action lawsuit.
The next step is the claims process. It’s unclear how much money each shareholder, including those from the Ohio Funds, will receive until the claims process is completed. It depends on how many shareholders come forward. Any shareholder who purchased AIG stock during the class period could be a class member.
As part of the total case involving AIG, the Ohio Funds and the Ohio Attorney General’s Office previously announced a $72 million settlement with General Reinsurance Corporation, a $97.5 million settlement with PricewaterhouseCoopers LLP and a $115 million settlement with CEO Maurice R. “Hank” Greenberg and other AIG executives (Howard I. Smith, Christian M. Milton and Michael J. Castelli) and related corporate entities (C.V. Starr & Co., Inc. and Starr International Co., Inc.).
These related cases have not yet received all of the required court approval.
The total recovery for AIG shareholders is expected to exceed $1 billion, making it one of the largest securities class action settlements in U.S. history, the Ohio AG’s office said.
If there is no appeal to the ruling, the claims administration process will likely be completed within six months and distribution of money can start.
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