Ex-chief executive seeking $25bn
Former AIG chief executive Maurice ‘Hank’ Greenberg is suing the US government for $25bn (£15.9bn) over the 2008 bail-out of the US insurance giant.
AIG was rescued from failure in 2008 through the US Treasury’s injection of $180bn of taxpayer’s money, a move Greenberg is now calling “unconstitutional”.
Greenberg is currently chairman and chief executive of US MGA and underwriting group Starr Companies. He departed AIG in 2005 amid accusations of accounting irregularities at the firm.
AIG, the parent company of global non-life insurance powerhouse Chartis, is currently run by Robert Benmosche.
The investment arm of Starr Companies, Starr International, was a major shareholder in AIG in 2008. The $25bn Greenberg is seeking is based on the value of the government’s stake in AIG as of January 2011. Greenberg’s complaint says the Fifth Amendment of the US Constitution prevents the taking of private property for public use without just compensation.
However, the US Treasury has hit back. According to a Wall Street Journal report, the Treasury’s assistant secretary for financial stability Tim Massad described the bailout as “necessary, legal and constitutional”.