According to ABC News, the Securities and Exchange Commission [SEC] has reportedly sent notifications (Wells notices) to various executives at American International Group (NYSE:AIG) Financial Products unit, known as AIG FP, letting them know that the agency’s enforcement division may recommend that the SEC take legal action against recipients.
The names of the AIG executives reportedly targeted, notes ABC, have not been disclosed, and the proceedings are kept private until the SEC files suit in federal court, should it choose to do so. Whether lawsuits alleging the firm committed securities violations will follow, is a subject yet to be determined at this point from the agency. What we do know from the release however, is that the SEC’s decision does not preclude a separate criminal indictment. Federal investigators are reportedly investigating former AIG FP CEO Joseph Cassano and possibly other current and former AIG execs for criminal fraud relating to the firm’s meltdown.
AIG FP unit, founded on January 27, 1987 and whose disastrous credit default swaps nearly pushed the giant insurer to the brink of bankruptcy, has largely been blamed for accelerating the deterioration of an already-weakening global economy.
SEC fines and penalties on some AIG FP executives, presumably including Cassano, “could range north of $1 million..and the loss of a professional license.” Joseph Cassano was receiving $1 million a month in 2008, after he had separated from the company. In all, Cassano reportedly raked in nearly $300 million with AIG, before leaving AIG FP. According to James Coffman, a retired 26-year veteran of the SEC’s enforcement division, the executives at AIG FP “did not appear to need any special licenses to concoct their exotic financial products”. Thus they likely would face only financial penalties.
DUH!! Don’t you have somthig better to do?? this story is retarded!!
GoodLuck with your Career…..Tamara
did you really need to use the word retarded? you have so many options. why use a word that dehumanizes children with special needs?
I can not help but remind you of all the companies in which would not be here now, If this company was not. The companies this company has had to Insure are the companies that need to be focused on. This compnay is being held as a scapegoat, get the real story please!! This company in my view, is a Black Swan, in a sea of deception.. The deception created by the very entities in which were to abide by certain professional discretions. You are a lemming you do not look forward, you look backward and pretend you understand.
DO NOT COPY OR POST THIS EMAIL..Tamara
I respect your view but couldn’t disagree more with your, I’d say, rather superficial and bias analysis. If you look into the CDS story and how that investment vehicle chronologically evolved, you will find out AIG (the world’s largest general insurance co) is largely responsible for planting the seed that nearly led to a total collapse of the global financial markets. Credit default swaps were born in ’98 when AIG first offered to insure Morgan’s complex corporate debt, in case of default. That’s a fact. If you check Horton’s AIG FP model you will agree with me….Secondly, while Taleb’s sea of deception argument is certainly a valid one, had AIG failed, the collateral damage to the banking system and the rest of the economy would have been catastrophic. Keep in mind the co. has more than 81 million life insurance policies with a face value of $2 trillion globally. Another point (on the technical side of things) is how were we suppose as, say money management firms or investors, establish a baseline valuation for a corporation of such magnitude as the insurer was/is, when it guaranteed risk and knowingly thought it could take in money without having to pay its obligations??!! Isn’t that an outlaw principle in its very core that at very least deserves no moral defense!
I’d like everyone in the media understand that it’s inaccurate to keep using the term “executive” to describe Joe Cassano and other AIG FP unit employees. Not everyone who makes large amounts of money are executives. There’s a big difference. Executives are those who set policy and strategy on a company-wide basis. They would include officers like the CEO, CFO and General Counsel. Hank Greenberg, Marty Sullivan and Ed Liddy were all AIG executives. Joe Cassano was not. Joe Cassano’s pay never showed up in the AIG proxy statement. Even with recently proposed amendments to the SEC’s rules, it probably never would have. His pay would never have been subjected to “say on pay.” So, call him whatever you want, except don’t call him an “executive” of AIG. It just makes the debate about executive compensation even more confusing to your readers.
THE MOST IMPORTANT LETTER ALL CEO’s SHOULD RECEIVE
Isn’t it time the system went in for some much needed repair?
Due diligence and oversight long ago slid out the window. No one was watching.
A dramatic change swept through all of North America’s boardrooms over the past 30 years. It is one of the underlying causes of the headache the economy is now feeling, but more importantly, it has resulted in the general feeling of “disconnect” by most Americans from the billions in bonuses being paid to too many on Wall Street who produce absolutely Nothing.
“We the shareholder of your companies, ….
http://pacificgatepost.blogspot.com/2008/03/letter-to-ceos-of-fortune-1000-cos.html