Cry me a river for AIG's ( AIG) former CEO Hank Greenberg. The poor man claims AIG ruined his fortune by lying about its financial health. Specifically, he claims AIG misled investors about its exposure to subprime mortgages. This is laughable. The man who sat at AIG's helm while the subprime explosion was in full bloom -- he was forced out in spring 2005 -- claims he was somehow uninformed about the company's financial health. Right, Hank. Everything was just fine while you were there. It all just fell apart without you. Nevermind that AIG restated five years of past financial statements as you were shown the door.
Hank seems to be getting forgetful. Not only has he forgotten his role in all this, he's also forgotten the government's current role. AIG is a government-owned business now, so who do you think you are suing exactly? Meanwhile, AIG's also taking abuse from its rivals, some of which are grumbling that the company is using government support to undercut prices in the market and hold onto its dominance. Even crippled, AIG is hard to beat, according to a report by TheStreet.com's Lauren LaCapra. That's almost as pathetic as Greenberg's lawsuit. Even with government loans, how hard can it be to win customers away from a money-losing insurer facing a constant barrage of bad publicity about its financial health?
A recent report from Bank of America ( BAC) equity research pointed out that many former AIG executives now work at rivals such as ACE ( ACE) and know how to take on the battered behemoth. Surely insurers such as Allianz ( AZ), MetLife ( MET) and Prudential ( PRU) know how to play this game, too. So is AIG taking unfair advantage of taxpayer aid or is it desperately struggling to hold onto customers with lower rates because they might otherwise flee out of concern about its weakened condition? Either way, taxpayers now own the company and have a vested interest in seeing it succeed. Otherwise, we're out almost $200 billion. That's the equivalent of a $1,435 stimulus check for all 139.3 million Americans who filed a tax return in 2007. So Hank, if anyone gets a payday out of AIG, it better be the taxpayers. You and those grumbling insurance rivals of AIG can just get in line behind the rest of us.