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AIG shares rise regardless of lawsuit


May 29, 2005   by Canadian Underwriter


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Recent market activity indicates American International Group (AIG) shares are on the rise, only one day after New York Attorney General Eliot Spitzer sued the company.
Gaining another $1.02 (1.8%), AIG’s shares recently added 3% leading the Company to reach its highest level since the end of March.
Maurice “Hank” Greenberg, AIG’s former chief executive and chairman Maurice Greenberg acted in a number of fraudulent deals resulting in the intentional embellishment of AIG’s underwriting operation. Spitzer says this in turn contributed to the incremental rate of growth the insurer’s share price experienced.
Greenberg personally negotiated some of the fraudulent transactions and ordered other AIG employees to develop and implement other misleading deals.
The investigations precipitated the departure of Greenberg in March and forced AIG to admit a series of accounting improprieties that helped artificially inflate its net worth by $2.7 billion, or 3.3%. Smith was fired by AIG earlier this year.


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