Word: starr
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...That seems to be the multibillion-dollar question in an ongoing court battle that pits Greenberg and his firm Starr International against his former employer AIG. The deeply troubled insurance giant claims Greenberg, through Starr International, improperly gained control of hundreds of millions of shares of AIG stock when he was booted from the company in 2005. (See 25 people to blame for the financial crisis...
...trial that started on June 15 in U.S. District Court in New York, AIG contends that the shares as well as over $4 billion in profits that Starr International has reaped from past AIG stock sales were meant to fund a long-standing deferred-compensation program for AIG employees - a program that Greenberg, 84, halted after his acrimonious ouster from AIG amid an accounting scandal...
...case have only increased now that AIG's fortunes have plummeted in the financial crisis. AIG's market capitalization has plunged 95% in the past year to a recent $4.3 billion. That means, should AIG be able to recapture it, the trove of cash and assets sitting at Starr, which has collected $4 billion from selling AIG shares in the past few years, could end up being one of AIG most valuable assets. That has made the mudslinging all the more intense...
...spokesperson for AIG says the idea that Starr is a charity is a sham, noting that Greenberg's company in all the years of its existence has donated less than 0.01% of its worth. "Only after AIG brought this action did SICO [Starr International] suddenly and cynically show charitable tendencies," says the spokesman. "Mr. Greenberg is dressing up SICO in a veneer of philanthropy just like a defendant who buys a new suit for the courtroom...
...Greenberg and Starr say that AIG should not be believed when it says it is pursuing the lawsuit on behalf of shareholders or taxpayers. In a recent e-mail to a blogger, a Starr spokesperson wrote, "By its own admission, AIG is prosecuting these claims for only one purpose: To add hundreds of millions of dollars to a bonus pool available to AIG's top 700 executives...