More nuggets of news from Hank Greenberg’s testimony before Congress….
Greenberg, with the prominent Washington lawyer David Boies at his side, declared that government efforts to rescue AIG — taxpayers now own almost 80 percent of the insurance giant — have failed. He said that that stake should be reduced to 15 percent, and that the company should be restructured, and current management should be removed.
Greenberg has been embroiled in legal wrangling with AIG almost since his 2005 departure from the firm, amid allegations of accounting improprieties.
He also quarreled with AIG’s decision, apparently blessed by the government, to pay back in full its counter-parties on the credit default swaps.
It would have been more beneficial for the American taxpayer if the federal government had walled off AIG Financial Products…and provided guarantees to AIGFP’s counterparties rather than putting up billions of dollars in cash collateral to those counterparties.
And asked by Rep. Rep. Elijah Cummings whether he took any responsibility for the firm’s collapse, Greenberg replied flatly: “No I don’t.”
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