trending Market Intelligence /marketintelligence/en/news-insights/trending/Dm3uvUMiEEb9VQOiSCuk4Q2 content esgSubNav
In This List

Supreme Court rejects former AIG chief Greenberg's appeal in fraud case


The Big Picture 2022 Insurance Industry Outlook


Next in Tech | Episode 37: Insurance impacts on technology and vice versa

Case Study

A Prestigious Global Business School Gains a Competitive Edge


S&P Capital IQ Pro | Unrivaled Sector Coverage

Supreme Court rejects former AIG chief Greenberg's appeal in fraud case

A U.S. Supreme Court ruling cleared the way for a lawsuit to proceed against Maurice Greenberg originating from his final years as CEO of American International Group Inc., Reuters reported.

The New York Attorney General's office accused Greenberg of fraudulent reinsurance transactions that inflated AIG's reserves and running deals to conceal underwriting losses in the company's auto-warranty insurance business. A decision by the New York Court of Appeals in June said the state could ban Greenberg and former AIG executive Howard Smith from the securities industry and from leadership positions at publicly traded companies, according to the report.

Greenberg argued that the case should have been settled when a federal judge approved a $115 million agreement with AIG shareholders, Reuters said. The former CEO challenged New York's continued legal action, but the appeals court sided with the state. The Supreme Court upheld the appellate court's decision. Court rulings also allow the state to recoup more than $55 million in bonuses and interest the executives gained during the period of the alleged fraud, the news outlet reported.

The case has been suspended while the parties try to work out the claims through mediation, Reuters added.