Greenberg Leaving AIG: Report
Updated from 8:05 a.m. EST
Maurice Greenberg will retire as chairman of
American International Group
(AIG) - Get Report
within the next few days, a report said Monday night.
Greenberg, who was stripped of his CEO title earlier this month amid a widening probe of the company's reinsurance transactions, informed AIG's board of his intentions Monday, the
Wall Street Journal
reported.
Word of the retirement comes amid reports that as many as 12 AIG executives have been subpoenaed by the
Securities and Exchange Commission
in the investigation of the insurance giant's accounting.
The agency, along with New York Attorney General Eliot Spitzer and several other regulatory bodies, continue to probe AIG's 2000 reinsurance transaction with
Berkshire Hathaway's
(BRKA)
General Re unit, as well as potentially dozens of other transactions with a network of small, offshore reinsurance firms over which AIG might have exerted undue influence.
Published reports over the weekend said up to 30 insurance transactions over the last five years at AIG might have relied on faulty accounting, and the company is weighing restatements of between $1 billion and $3 billion.
The bookkeeping overhaul could make it difficult for the insurance titan to file its annual report with the Securities and Exchange Commission before March 31.
AIG has been in regulators' lenses all year over its suspected use of various reinsurance strategies to lop poorly performing policies from its balance sheet. Most of the controversy has centered on whether the reinsurance transactions were subject to appropriate negotiation and risk-transfer, elements necessary for favorable accounting treatment.
According to reports Friday, investigators are combing through dozens of reinsurance transactions AIG struck with a network of offshore companies, over which the company might have exerted undue influence or control.
AIG's board met last week to discuss the problem and is still in talks with internal and outside investigators about the handling of any accounting revisions. A worst-case, $3 billion charge would only erase about one-third of the company's 2004 earnings, which were reported on a preliminary basis earlier this month. The company's long-term debt is currently rated triple-A by Moody's and Standard & Poor's, the highest possible rating.