Maurice Greenberg, the former chief executive of American International Group Inc and creator of the doomed unit whose investments triggered its downfall, came under fire from U.S. lawmakers on Thursday who questioned his claims of ignorance.
“Crumbling of AIG began on your watch,” Darrell Issa, the ranking Republican on the House oversight and government reform panel, said in opening remarks, noting that Greenberg’s credibility was compromised amid various ongoing government probes.
Several congressional committees are probing the causes of the rise and fall of AIG, which got nearly $180 billion in government funds to prevent a bailout and is the largest recipient of government money. Taxpayers now own 80 percent of AIG.
Greenberg, who was the insurer’s CEO for more than 35 years and created the financial products unit that traded in credit default swamps, rejected claims that he had a role in ramping up the risky credit fault swaps business.
The fragile-looking, 83-year-old Greenberg said he knew of no losses from the products that were initiated during his tenure.
“As far as I know there were no losses … on the credit default swaps,” said Greenberg, who is mired in lawsuits with his former employer and various government bodies. “When I left the company, it was healthy.”
Greenberg was forced out by AIG’s board in 2005 after he refused to cooperate with an internal investigation into off-balance sheet transactions that were being scrutinized by the U.S. Securities and Exchange Commission and various state attorneys general.
The probes did not have any connection to the financial troubles that nearly toppled AIG last September.
Asked by Rep. Elijah Cummings, a Maryland Democrat, if he took any responsibility for the subsequent collapse of the company, and noting that AIG lost its AAA bond rating days after he left, Greenberg said: “No, I do not.”