Maurice "Hank" Greenberg, who turned American International Group into a global insurance powerhouse, is stepping down as chairman this week, as investigations into AIG's business practices mount.
After the US Securities and Exchange Commission (SEC) put 10 new possibly questionable transactions under scrutiny, AIG said former Nasdaq chairman and AIG board member Frank Zarb will assume the duties of chairman today or tomorrow, when Mr Greenberg returns from a two-week trip to Asia and Europe. Mr Greenberg (79), took the reins of the company in 1967, transforming it from an obscure seller of life insurance overseas into a market leader with nearly $100 billion (€77.4 billion) in revenue and 93,000 employees worldwide.
Mr Greenberg, who had become the insurance industry's dean, had already stepped down as chief executive two weeks ago as AIG became the latest insurance company to face scrutiny by regulators looking into possible abusive practices.
The SEC has subpoenaed 12 AIG executives in an expanding probe of the insurer, sources close to the case said.
US government investigators had focused initially on a deal done in 2000 involving New York-based AIG and General Re, a unit of Warren Buffett's Berkshire Hathaway, that may have artificially boosted AIG's reserves, the sources said.
But the SEC investigation has since expanded to cover 10 other potentially questionable transactions and possible accounting errors valued at about $1 billion, the sources said. - (Reuters)
In a report entitled Integrity is best, says Spitzer, published on March 23rd, it was stated that AIG has been prosecuted for fraud and corruption. AIG has asked us to point out that it has not been prosecuted and that it is co-operating with the New York Attorney General, Elliot Spitzer, and other government entities in investigations of insurance brokerage sales practices, finite insurance and other issues.
The company said four lower-level employees of one AIG unit in the US have pleaded guilty to related charges and that it requires all employees to co-operate with government authorities on matters pertaining to the company.
