Business

GREENBERG SAYS AIG RIPPED HIM OFF WITH HYPED SHARES

AIG founder Hank Greenberg yesterday launched two separate salvos against his former company, accusing it of cheating him out of a fortune and blasting current CEO Ed Liddy for trying to lay some of the blame for AIG’s woes at Greenberg’s feet.

Greenberg sued AIG in Manhattan federal court, claiming execs at the insurer kept shares “artificially inflated” by lying about the company’s exposure to subprime mortgages. He claims those “material omissions and misrepresentations” killed the value of 3.7 million shares of AIG stock he got under a deferred-compensation package in January 2008.

The lawsuit doesn’t specify damages, but demands the $70 million in taxes he paid on the $200 million in stock. AIG shares closed unchanged yesterday at 42 cents.

Meanwhile, Greenberg is said to be outraged at Liddy, who yesterday said AIG’s woes began under Greenberg and culminated yesterday with AIG reporting the largest quarterly loss in US corporate history – $61.7 billion.

Greenberg shot back that Liddy is hiding behind finger-pointing, and that the toxic crisis happened only after Greenberg left the company in the hands of other managers four years ago.

“Mr. Liddy’s personal attacks on Mr. Greenberg are apparently designed to deflect attention from AIG’s disastrous performance since Mr. Greenberg retired four years ago, and to distract attention from its wasteful use of shareholder and taxpayer funds since that time,” Greenberg’s office said.