AIG Lawsuit Would Be $182 Billion Taxpayer Slap in the Face
Posted on January 08, 2013 at 17:42 PM EST
Just one month after American International Group Inc. (NYSE: AIG ) paid back the last of its huge $182.3 billion U.S. taxpayer-funded rescue, the insurance giant is pondering whether to join a shareholder lawsuit charging the bailout terms were unfair. Former AIG CEO Maurice Greenberg initially filed the lawsuit in 2011, claiming the 14% interest rate that the government charged, as well as the large size of its stake - 92% - were harmful to AIG shareholders. Greenberg's lawsuit seeks $25 billion in damages from the U.S. Federal Reserve and the Treasury Department. The federal government had earned a return of $22 billion from the bailout, which AIG repaid in full as of mid-December. The AIG board is scheduled to meet tomorrow (Wednesday) to discuss whether to join Greenberg's lawsuit and make a decision by the end of the month. "It's absolutely outrageous and a king-sized slap in the face to U.S. taxpayers," said Money Morning Chief Investment Strategist Keith Fitz-Gerald. "This is like a trauma victim suing the ambulance company for getting him to the hospital in time to save his life. AIG was not only all too glad to participate in the bailout and stay in business, but Greenberg helped create the mess in the first place." To continue reading, please click here...