AIG Sues US Over Tax Payments

(NEWSER) - The IRS is challenging a series of tax-skirting deals engineered by the much-maligned AIG Financial Products unit, the Wall Street Journal reports. The deals exploited differences in international tax codes to reduce tax payments for foreign banks—many of the same banks the US government would later pay to settle contracts with the insurer. At its height, the business was even larger than AIG’s credit-default-swap trade. More»

They say takeover violated investors' fifth amendment rights

(NEWSER) - Former AIG CEO Hank Greenberg is suing the US government for $25 million for having the effrontery to bail out the dying insurer. Greenberg was ousted in 2005 after allegedly cooking AIG’s books to inflate its value, but still had a keen interest in the company during the bailout, because his firm, Starr International Co., was its largest shareholder. Now Greenberg’s saying that the bailout of the firm violated shareholders’ constitutional rights, the Wall Street Journal reports. More»

But it's not clear if they legally had to

(NEWSER) - Bank of America knew that AIG was about to try to sue its pants off as far back as January, but it never told investors on any of its conference calls or in any of its regulatory filings, sources tell Reuters . Public companies are supposed to disclose legal threats to their stock prices, and when the $10 billion AIG suit was announced earlier this month, it sent the bank’s stock plummeting 20%. More»

Says it was misled about quality of mortgage-backed securities

(NEWSER) - With the Justice Department filing few criminal charges related to the financial crisis, AIG is taking action of its own: The mostly taxpayer-owned firm is preparing to sue Bank of America for allegedly misleading it about the quality of Bank of America's mortgage-backed securities—an accusation that gets to the root of the financial crisis. AIG wants to recoup more than $10 billion in losses in what might be the biggest mortgage securities lawsuit by "a single investor" in history, the New York Times reports. More»

Given current market, they'll make $9 billion in small sale

(NEWSER) - The Treasury has decided to go through with a plan to sell 300 million AIG shares, despite recent blows to the nationalized insurer’s market price, sources tell the Wall Street Journal . Given the sagging demand, the government expects to make around $9 billion in the small offering, which is on the low end of the $7 billion to $25 billion it had hoped for. More»