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Posts tagged with the keyword: ‘AIG’

The Real AIG Scandal: How the Game is Rigged at Wall Street’s Casino

The Real AIG Scandal: How the Game is Rigged at Wall Street’s Casino

AlterNet, March 26, 2009 –

Congress has deftly avoided the real story of AIG’s collapse, which will make a few million in bonuses seem like peanuts.

Most legislators at a House Finance subcommittee hearing last week deftly avoided the real story of AIG’s collapse. Instead, they homed in on the public relations disaster of hundreds of top AIG officials and staff getting $165 million (later revealed as over $218 million) in bonuses.

The key issue ignored by the congressmen and women was the potential catastrophe represented by as much as $2.7 trillion in AIG derivative contracts and how AIG and the U.S. government are dealing with them. To put that number in context, we’ve so far provided the company only about $170 billion.

AIG’s Past Could Return to Haunt

AIG’s Past Could Return to Haunt

Inter Press Service (IPS) Dec 19, 2008

American International Group (AIG) operated a captive insurance scam that involved fraudulent use of offshore tax havens. Currently, the U.S. government has invested over $40 billion in AIG, with the U.S. getting nearly 80 percent of its stock. AIG, photo AP/truthout

This puts the U.S. in a unique position to investigate the internal operations of a giant corporation with a reputation for using the offshore system for tax evasion.

U.S. authorities could begin their investigations with a look into a very curious practice that was revealed 15 years ago in a case that was never exposed by the mainstream press and which insurance insiders say is endemic.

AIG would keep a portion of a client’s inflated insurance premium and send the rest to the client’s offshore reinsurance company. AIG would earn a higher commission. The client would write off the entire amount as a business expense and enjoy the extra cash offshore, tax free.

This story tells how notorious fraudster Victor Posner made an AIG deal to stash reinsurance profits in Bermuda.

Take The Money And Run Offshore

Take The Money And Run Offshore

AlterNet, Dec 22, 2004

How insurance companies are aiding tax evasion by over-charging in America and shipping the money to offshore firms.

Terry Mills was working in Wilmington, DE, for J. Montgomery, one of the largest insurance agencies in the region, when in 1993 he was called in to get to the bottom of a messy insurance problem. Little did he know that he would uncover a story – as yet unreported – about tax evasion through offshore firms, but with a twist. The scheme Mills came across seemed to be taking place with the aid of AIG, a major U.S. insurance giant.

Cooking the Insurance Books: A Decade of Lax Regulation Lays Groundwork for Scandal

Cooking the Insurance Books: A Decade of Lax Regulation Lays Groundwork for Scandal

CorpWatch, Nov 17, 2004

In October, New York Attorney General Eliot Spitzer filed suit against the world’s largest insurance broker, Marsh, accusing it of rigging bids and receiving kickbacks in order to defraud clients such as other corporations, city governments, school districts and individuals of billions of dollars through inflated premiums.

“Greedy trial lawyers were the usual excuse for premium increases. Now we know that greedy corporations also have a starring role,” Spitzer said, accusing several insurance companies as co-conspirators in making phony or inflated bids and paying kickbacks to the brokerage to get business.

Cooking the Insurance Books

Cooking the Insurance Books

Nov 2004

Insurance giant AIG has used offshore structures in Barbados and Bermuda to circumvent or violate U. S. state laws regarding reinsurance and to help at least one crooked client evade taxes.

In the late 90s, four state insurance departments were aware that AIG was secretly hiding its debts offshore but, despite substantial evidence of wrongdoing, no sanctions were ordered.