Ball point pen on the morning newsprint
Founder of AIG, Hank Greenberg, was forced to leave the company in 2005 under threat of indictment by New York's (then) attorney general Eliot Spitzer, but not without a very nice golden parachute. As PART of his deferred compensation, he received 3.7 million shares of AIG stock in January of 08. At that time AIG's stock price was in the mid 50's making the payment worth about $200 million, for which he paid $70 million in taxes. Today AIG's stock is valued at 42 cents, making those same shares worth 1.5 million. Now Greenberg is suing his former company claiming they hid their exposure to sub-prime, artificially keeping the stock price high. I guess he's in a position to know. Yesterday on Bloomberg, current CEO Liddy claimed that Greenberg was at the helm during the formation of AIG’s financial products unit, which sold derivatives that cost the company more than $30 billion in writedowns and prompted a government rescue. The worst part is, since AIG is being kept afloat with taxpayer money, should Greenberg prevail, you and I would pay the settlement. That's rich!