Eliot Spitzer and the US justice department are trying to determine whether Maurice "Hank" Greenberg tried to manipulate the share price of American International Group (AIG) a month before he was ousted as chief executive.

The investigation increases the chances that Mr Greenberg could face criminal charges over his role in an accounting scandal at the world's biggest insurer.

Mr Spitzer, the New York state attorney general, and federal prosecutors are examining an audiotape which indicates Mr Greenberg placed a call to an AIG trader last February and asked him to buy shares in the insurer.

The call came shortly after AIG shares began to fall, after the company revealed that regulators had opened an investigation into its accounting methods, a person close to the investigation said.

It is not illegal for a company to buy back its own shares, but certain regulations bar executives from doing so to boost the price of shares artificially.

"It's a matter of figuring out Mr Greenberg's intent," a person close to the investigation said.

Shares in AIG have fallen about 25 per cent in the three months since it announced regulators were examining its accounting methods.

Mr Greenberg was forced to step down in March amid scrutiny over the role he played in handling the group's accounting.

This week, AIG said improper financial reporting would reduce its book value by about $2.7 billion (€2.1 billion). The insurer is preparing to restate four years of accounts.

AIG also said it had discovered certain accounting entries at senior management level that "appear to have been made at the direction of certain former members of senior management without appropriate support".