Former AIG CEO May Face SEC Charges

Former CEO of American International Group, Maurice R. “Hank” Greenberg, may face civil charges from the Securities and Exchange Commission regarding his alleged role in improperly enhancing the insurer’s financials via fraudulent charges with General Re Corp.

Greenberg received the Wells notice last Friday, revealing that the federal government may take action against him. The notice was penned after a postverdict ruling by the federal judge overseeing the criminal trial said the government had provided “sufficient evidence” for a jury to conclude that a phone call from Greenberg had started the entire conspiracy. Official charges have not been filed.

Greenberg was identified as an unindicted alleged co-conspirator regarding the criminal case involving General Re transactions. Robert Morvillo, Greenberg’s attorney, said in a statement Tuesday, "The Wells notice is a step in the process....We remain confident of our position on the merits, and we believe that none of the remaining issues are material to AIG's financial statements. When the commission has had the opportunity to consider all the facts, we believe that they will agree."

The Wells notice says that the SEC may seek approval from its commissioners to bring up charges. Greenberg stepped down from AIG in 2005 after the company came under investigation for its accounting practives. In 2006, AIG agreed to pay $1.6 billion to settle allegations.