An independent committee of The Starr Foundation, a $3 billion charity, cleared longtime AIG chief Maurice “Hank” Greenberg and several other former key executives of any hanky-panky in setting it up over 37 years ago.
The otherwise low-profile charity, seeded with the assets of AIG founder Cornelius Vander Starr, became a bitter battleground as former New York Attorney General, now Governor, Eliot Spitzer, accused Greenberg and others of self-dealing.
Specifically, he charged them with costing the foundation $6 billion by selling Vander Starr’s assets at below-market prices to two private companies that they controlled.
Greenberg has continued to serve as chairman of the Starr Foundation as well as the two private firms, C.V. Starr & Co. and Starr International Co., since being forced to resign from the helm of AIG in March 2005.
The former attorney general never sued over the foundation, and subsequently dropped some of the earlier allegations against Greenberg, now 81. AIG, the world’s largest insurer, settled its part of the case in February 2006.
The Starr Foundation’s committee, in an exhaustive 179-page report, found no evidence to support Spitzer’s charges.
“The executors of the estate acted in good faith and prudently performed their duties,” the independent committee wrote. They recommended that the foundation not pursue any litigation against Greenberg and his former colleagues.
A spokesman for Attorney General Andrew Cuomo said, “This office is not surprised that a foundation controlled by Mr. Greenberg issued a report exonerating him of wrongdoing.”
The A.G.’s broadside against Greenberg, however, fails to take into account the independent nature of the committee, with two veteran trial and appellate court judges sitting on the panel, said a source from Greenberg’s camp.
“The foundation acted on Spitzer’s wishes and got an independent panel to examine every aspect of their charges, nor were they, as laid out in the report, particularly helpful to the examination,” said the Greenberg ally.