Sunday, August 9, 2009

Greenberg Fined

The former top executive of embattled insurance giant AIG, Maurice “Hank” Greenberg, agreed to pay 15 million dollars to settle accounting fraud charges, US authorities said Thursday.

The Securities and Exchange Commission said Greenberg, chairman and chief executive at AIG before its spectacular meltdown, will pay disgorgement and penalties to settle a probe into “numerous improper accounting transactions that inflated AIG’s reported financial results between 2000 and 2005.”

The company’s former chief financial officer Howard Smith meanwhile will pay 1.5 million dollars to settle related charges, the SEC said in a statement.

The SEC said it filed the charges and settlement in US District Court for the Southern District of New York.

Greenberg, 84, had led the American International Group for four decades before he was ousted amid an accounting probe in March 2005, ahead of the near collapse of the insurance behemoth during a global financial crisis stemming from a US home mortgage meltdown.

It was taken over by the US government last year in a massive 170-billion-dollar bailout.

The SEC alleged that Greenberg and Smith were responsible for “material misstatements that enabled AIG to create the false impression that the company consistently met or exceeded key earnings and growth targets.”

The SEC had charged AIG in 2006 with securities fraud and improper accounting, and the company had settled the charges by paying disgorgement of 700 million dollars and a penalty of 100 million dollars, among other remedies.

“Without admitting or denying the SEC’s allegations,” Greenberg and Smith had consented to a judgment directing them to pay the penalties, the SEC said.

1 comment:

  1. Of course companies like AIG, Goldman Sachs and the rest of the big "finance" companies are mostly all guilty of as much thievery as they can get away with. No surprise there. And occasionally one or another of them gets nailed as a sort of public show that "justice is being done". That's all bs. There is never parity between what they have stolen and the "consequences" they then face. And most are never brought to account at all. That makes sense snes they own most of the lawmakers in our supposed "democracy".

    This state of affairs also ignores the real crime: The U.S. money supply is almost exclusively issued by private banks, who then "loan" that money to the federal government, and charge them a hefty interest rate for the money. The banks are providing absolutely no value at all for the money they collect via this obscene arrangement. All the banks do is make an accounting entry on their books, and then sit back and collect the interest, which ultimately we all pay. Hardly anyone even knows that this is how things work. Henry Ford once said that if the American people knew what the bankers really did there would be a revolution before morning. I think that is true. Want the details? Read "The Web Of Debt" by Ellen Hodgson Brown, J.D. It really spills the beans on this ongoing massive scam. By the way, the very few presidents who have tried to change this and have the federal government issue its own money have faced often fatal opposition from the bankers. Lincoln is an example.