Hank Greenberg: “Don’t Blame Me for AIG”
From the Wall Street Journal (pay site):
“I think they got greedy. I think they wrote considerably more business than they should have,” Maurice “Hank” Greenberg told the House Oversight and Government Reform Committee Thursday.
They got greedy? Them?
Rep. Elijah Cummings (D., Md.) was more direct, asking Mr. Greenberg during a heated exchange, “Do you take any responsibility at all?”
Mr. Greenberg, accompanied by high-profile attorney David Boies, refused to accept any blame.
“No I don’t,” Mr. Greenberg said, referring to subsequent losses at the financial-products division and downgrades of AIG’s ratings. He said the management that took over when he left the firm “must have paid very little attention” to the growing problems that led to the firm’s demise.
Here’s the kicker:
In a statement, AIG said that when Mr. Greenberg left in March 2005, the unit had already sold about half of the swaps that caused the biggest problems. AIG added that the company’s exposure under the contracts wasn’t hedged.
These CDS’s are only the latest bullshit scams propagated by AIG. Greenberg got forced out in 2005 by then-New York Attorney General Elliot Spitzer, who suspected that Greenberg, a hands-on guy for more than 35 years, knew exactly what he was doing. Evidence later showed that by 2000, AIG was using accounting sleights of hand to “cook the books,” according to the executive responsible . . . who pleaded guilty in 2005:
John Houldsworth, a former General Re executive who this week agreed to plead guilty to a criminal charge of conspiring to misstate AIG’s finances, discussed the planned transaction in a November 2000 phone call with the insurer’s chief financial officer at the time, Elizabeth Monrad.
“They’ll find ways to cook the books won’t they?,” Houldsworth said to Monrad, according to a civil complaint the Securities and Exchange Commission filed Monday in conjunction with the plea agreement. The comment prompted Monrad to laugh, and then Houldsworth continued, “It’s up to them! We won’t help them to do that too much. We’ll do nothing illegal!”
Actually, yes you will, it seems. But don’t blame the boss.