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June 27, 2005
Does Hank Greenberg read Clear Thinkers?
This post from last week made the following comment about the "finite risk" insurance transaction that is at the center of Eliot Spitzer's investigation of AIG and Berkshire Hathaway unit General Re, and AIG's former chairman and CEO, Maurice "Hank" Greenberg:
Despite the government's bludgeoning of various AIG and General Re executives into plea deals and the AIG's board acquiescence to Mr. Spitzer and other governmental investigators, it still has not been proven that the transaction in question in AIG's case was even accounted for improperly, much less illegal. Should not the government wait to address possible criminality (and its corresponding negative effect on value) until at least the underlying transaction has been proven to be violative of applicable accounting rules?
In this letter to the editor in today's Wall Street Journal ($), Mr. Greenberg observes as follows about the same transaction:
That transaction is the subject of litigation so I am not free to respond fully. I can assure you that an appropriate response will be made at a proper time in a proper forum. (I do note that rules for finite reinsurance are opaque and only now have the NAIC and FASB undertaken to clarify these rules.)
Posted by Tom at June 27, 2005 04:49 AM
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