By Bill Kenealy
Testifying before the House Committee on Oversight and Government Reform, Maurice "Hank" Greenberg, former CEO of American International Group Inc. (AIG), laid the blame for the company’s demise on his successors, saying the company was healthy when he was forced out in 2005.
“AIG’s business model did not fail—its management did,” he testified. “AIG’s business model has a long track record of success over many decades.”
Elsewhere in his remarks, Greenberg sought to deflect criticisms that the company had a lax approach to risk management.
“AIG had a unique culture when I was its CEO, particularly in comparison with the way many large public companies operate today,” he said. “We had comprehensive and conservative risk-management structures and procedures.”
Moreover, Greenberg charged that the multi-billion dollar bailout plan conceived by former Treasury Secretary Paulson to liquidate AIG has failed.
“A successful liquidation is impossible in the present economic climate, since buyers for AIG assets at fair values simply do not exist at this time,” he said. “Fire-sale prices will bring taxpayers, who now own almost eighty percent of AIG, only pennies on the dollar for their investment in AIG.”
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