Ex - AIG Chief Gave Wife 41.4 Million Shares
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Filed at
That disclosure by Maurice ``Hank'' Greenberg came Tuesday, hours after he declined to discuss a questionable insurance deal with state and federal regulators who are probing questionable transactions by AIG.
Greenberg resigned as president and CEO of the New York-based insurer on
March 14, three days after he had transferred 41.4 million shares -- worth $2.2
billion at Tuesday's closing share price of $53.20 -- to his wife, Corinne P.
Greenberg.
Greenberg directly held 1.95 million shares after the transfer, according to
the filing Tuesday with the Securities and Exchange Commission. Greenberg also
disclaimed ownership ``and any pecuniary interest'' in another 23.65 million
AIG shares he held through C.V. Starr & Co. Inc., which controls AIG
managers' compensation.
Howard Opinsky, a spokesman for Greenberg's legal
team, declined to comment on the filing. AIG spokesman Chris Winans said the company had no comment.
At Tuesday's deposition, Greenberg invoked his Fifth Amendment rights
against self-incrimination in response to all questions during the 45 minute
session, according to a person who attended the meeting but asked not to be
identified by name.
``I'm told it was quiet, cordial and professional,'' Opinsky
said after the meeting.
Greenberg, who arrived and exited the building via an underground tunnel,
made no comments after the meeting. His lawyer had indicated on Monday that his
client likely would refuse to answer questions because he had not had
sufficient time to prepare.
Greenberg's substantial stock gift to his wife is sure to provoke the
interest of regulators and lawyers in the case, because it appears to be an
effort to shield assets, said Thomas Ajamie, a
securities lawyer in
``He anticipated that something serious was going to happen to him and he's
trying to move assets to his wife,'' Ajamie said.
``This large of a transfer, even in isolation, would garner regulatory
scrutiny, but in the context of the criminal and civil issues, the warning
bells are waking up people from here to
Investigators who attended the Tuesday session with Greenberg in New York
Attorney General Eliot Spitzer's office in lower
The investigators are looking into a number of reinsurance transactions
booked by New York-based AIG, one of the world's largest insurers. Reinsurance
traditionally has been used to spread out risk among insurers but, in some
cases, has been used for the questionable purpose of polishing a company's
financial statements.
In the transaction at the center of the probe, AIG purchased reinsurance
from General Reinsurance Corp. in the fourth quarter of 2000 and first quarter
of 2001. Investigators have said that AIG used the deals to pump up its
reserves when markets were uneasy about the company's outstanding liabilities.
AIG acknowledged recently that its accounting for
the transaction with Gen Re ``was improper and, in light of the lack of
evidence of risk transfer, these transactions should not have been recorded as
insurance.''
Billionaire investor Warren Buffett, whose holding company Berkshire
Hathaway Inc. owns Gen Re, spoke with the investigators on Monday. The
investigators indicated that Buffett was a ``cooperating witness'' while
Greenberg was subpoenaed as a target in the probe.
Before Tuesday's session began, Joseph Fritsch, director of insurance
accounting policy in the New York state insurance department, told reporters
that investigators had ``40 pages of questions'' for Greenberg.
He said that other AIG executives would likely be called for questioning,
and that new information from them could result in a fresh subpoena for
Greenberg.
Fritsch also said that Buffett a day earlier confirmed ``that Hank knew
about the deal'' between AIG and Gen Re and that Greenberg had told a former
Gen Re executive that he was disturbed about repeated questioning from Wall
Street analysts over the level of AIG's reserves.
Fritsch quoted Buffett as saying he did not give prior approval to the
transaction, leaving the decision-making to his subordinates.
In a column in Tuesday's Wall Street Journal, Greenberg's lawyer, David Boies, said Greenberg had asked to postpone the questioning
to allow for more time to review the documents in the case, and to limit
questions to the General Re transaction. Both requests were denied, Boies said.
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Associated Press Writers Justin Bachman and Erin McClam
in