Even though AIG (American International Group Inc.) paid back taxpayers for the government bailout years back, a multi-billion question and an ex-boss still looms over the firm.
AIG insured the Federal Reserve Bank of NY for any payments from litigation related to emergency loans.
An investment and charitable firm operated by ex-AIG boss Maurice Greenberg will seek for over $40 billion for losses he claims his firm and shareholders went through during the bailout. His present firm, Starr International Co., blames the government for taking property of shareholders while violating the U.S. constitution.
If Greenberg becomes victorious AIG will likely be responsible for damages. If the government committed unlawful acts, AIG would plead that the indemnification provision shouldn’t be carried out.
The suit is a representation of the firm’s risk as it moves into a new chapter.
The trial will last for several week at the U.S. Court of Federal Claims. Officials who are expected to testify include ex-Federal Reserve Chairman Ben Bernanke and former Secretary Tim Geithner.