Former AIG boss over-egged claims to boost staff morale
Maurice “Hank” Greenberg told the federal court he had been “exaggerating” when he told the Starr International (Sico) plan’s participants in 2000 that the plan was developed to “have sufficient shares in the trust for a couple hundred years”, the FT reports.
“That was just a figure of speech and not an actual commitment,” Greenberg said, claiming he was trying to boost morale.
Two weeks after he quit as chief executive, Greenberg resigned as AIG’s chairman and Starr’s board voted to remove three members who were AIG executives.
Asked if he initiated their removal, Greenberg said, “I can’t recall if it was me. There was some discussion and the decision was made after the discussion.”
Greenberg also faced questioning as to why a compensation plan he once promised would be around for hundreds of years was terminated.
Shares flee the US
Dow Jones adds that Greenberg and Sico moved a large block of AIG’s shares out of the US in 2005 in order to avoid their potential seizure in lawsuits.
Greenberg said the voting shareholders of Sico instructed JPMorgan Chase to release share certificates for millions of AIG shares in September 2005 and authorised their movement to Bermuda on the advice of their legal counsel.
The request was made the day after AIG filed legal claims over the shares against Sico. "It was a reaction to the entire environment evolving between AIG, Starr International and some of the people involved," Greenberg said. "It began to get very ugly."
