From the Wall Street Journal:
Did the U.S. government break the law when it seized control of American International Group during the financial crisis of 2008? In "The AIG Story," the man who built the giant insurer says that the answer is yes and explains his reasoning. Former AIG chief executive Maurice R. "Hank" Greenberg—along with his co-author, Lawrence A. Cunningham—also offers a fascinating company history and an account of how, after Mr. Greenberg's ouster in 2005, AIG made the disastrous mortgage bets that drove it into the arms of the feds. ...
Taking over in 1968, Mr. Greenberg launched the company on one of the great winning streaks in corporate history. By 2005, the authors report, the value of the company had increased by 19,000%, and AIG was the world's largest insurance company. The streak ended that year when New York Attorney General Eliot Spitzer accused Mr. Greenberg of fraud—specifically, of having engineered a sham reinsurance transaction to boost AIG's reserves against losses—and bullied the AIG board into firing him with threats of a corporate indictment. Like many of Mr. Spitzer's prosecutions, the case turned out to be less successful in court than in the media. No criminal charges were ever filed against Mr. Greenberg, and much of the civil suit was later dropped. ...
When the day of reckoning came in 2008 and the failed mortgage bets threatened to sink the firm, the government took control of AIG. Mr. Greenberg argues that it was illegal since the feds never received the approval of shareholders.
This is a great book and a must read.
