Become a fan of Slashdot on Facebook


Forgot your password?
Government The Almighty Buck The Courts Politics Your Rights Online

AIG Contemplates Joining Stockholder Suit Against US Gov't 354

inode_buddha writes "After completing its bailout rescue and paying back the money with interest, AIG is considering suing the US Government for doing so. The reasons why? Among other things, the 14% interest rate paid to the government. 'The lawsuit does not argue that government help was not needed. It contends that the onerous nature of the rescue — the taking of what became a 92 percent stake in the company, the deal's high interest rates and the funneling of billions to the insurer's Wall Street clients — deprived shareholders of tens of billions of dollars and violated the Fifth Amendment, which prohibits the taking of private property for "public use, without just compensation." The former CEO and current major shareholder said: "The government has been saying, 'We're your friend, we owned and controlled you and we let you go.' But A.I.G. doesn't owe loyalty to the government," a person close to Mr. Greenberg said. "It owes loyalty to its shareholders."' The lawyer representing him is none other than David Boies of SCO fame."
This discussion has been archived. No new comments can be posted.

AIG Contemplates Joining Stockholder Suit Against US Gov't

Comments Filter:
  • by PhrostyMcByte ( 589271 ) <> on Tuesday January 08, 2013 @12:48PM (#42520071) Homepage
    This is particularly hilarious to me because AIG just started airing TV commercials giving themselves a nice big PR pat on the back for explicitly "paying back with interest".
  • by ganjadude ( 952775 ) on Tuesday January 08, 2013 @12:53PM (#42520173) Homepage
    that is debatable. I know that some banks were actually forced to take money from the government

    The first 1-pager is Paulson's talking points for the bank. It basically confirms that he put a gun to all their heads. It says they must agree to take their cash, and that if they protested, then each bank's regulator would force them to take it anyway.

  • by Zordak ( 123132 ) on Tuesday January 08, 2013 @01:03PM (#42520301) Homepage Journal

    A companies first and foremost responsibility is to it's customers, 2nd to it's employees and finally 3rd to it's shareholders.

    Um, no. At least in Texas, the directors, officers, and employees owe fiduciary duties to the company (shareholders). The company owes nothing to the customers and employees outside of any contractual duties they assume and the general legal duties like ordinary care and non-discrimination. I assume it's the same in most other states.

    (More than usual, this is not legal advice.

  • by ArsonSmith ( 13997 ) on Tuesday January 08, 2013 @01:28PM (#42520683) Journal

    It wasn't taxed or inflated, it was borrowed at ~5% and then loaned out at 14%. it was pure profit for the government.

  • by interval1066 ( 668936 ) on Tuesday January 08, 2013 @01:31PM (#42520719) Homepage Journal
    I'd agree with you normally, but in this case the banks are completely wrong. They're criminal, in fact. Here's a little known fact: name almost any large "institutional" bank, chances are you'll be naming a bank that was and has been complicate in the on-going laundering of drug and terrorist money. Name ANY ONE. To the tune of BILLIONS of dollars. ILLEGAL in ANY jurisdiction and punishable by YEARS in federal PRISON. NOT ONE of these "institutional" bank's major presidents, CEOs, CFO's, board members, NONE OF THEM, have been made to answer for these crimes. Fines have been paid, a billion in the case of HSBC [], probably the worst offender, but NO ONE human being has been made to answer for these offenses, some of them used to fund the killing of thousands of people. "Too big to fail" was Obama said, didn't he? The government is complicate, but they at least are the one institution that is at least paying lip service to justice. Seems to me that the banks are the ones doing the screwing.
  • Re:For fucks sake (Score:4, Informative)

    by bjdevil66 ( 583941 ) on Tuesday January 08, 2013 @01:39PM (#42520861)

    We tried that in the west once - it was called the French Revolution (with the guillotine instead of guns). The last time I checked that whole didn't turn out so well for anyone.

    I'm all for telling AIG to kiss our collective asses because of this lawsuit, but +5 Insightful? Come on...

  • by Steve Hamlin ( 29353 ) on Tuesday January 08, 2013 @01:53PM (#42521055) Homepage

    Your arguments:


    Grocery inflation is running at under 2% a year. Overall inflation is about the same. Credible alternative measures of inflation support the BLS data. You are wrong.

    Source: []


    Money was lent, not spent. It has been repaid. The actions happened in a Liquidity Trap, where evidence for crowding out is non-existent. And evidence for even soft Ricardian Equivalence is weak, so your argument doesn't even make sense under your misconstruction. You are wrong for several reasons.

    But interesting! Don't fall too far down the Austrian School hole, though. The past 6 years have proven that modern Keynesian economic models are a very good description of how the global economy actually responded to the recent massive financial problems. Saltwater is simply (and rightfully) abusing Freshwater at this point - certain conservative economists and pundits should be embarrassed to continue to flog their dead talking points.

  • That's not true. (Score:5, Informative)

    by Anonymous Coward on Tuesday January 08, 2013 @01:57PM (#42521127)

    The first 1-pager is Paulson's talking points for the bank. It basically confirms that he put a gun to all their heads. It says they must agree to take their cash, and that if they protested, then each bank's regulator would force them to take it anyway.

    No. The banks jumped at the money but they and Paulson didn't want the public to panic if they found out how shaky the banks really were. So Paulson made up that BS story about forcing the banks to take the money.

    Source []

    As time goes on, we're hearing more and more about the shenanigans that were done at the expense of the US taxpayer.

  • Re:Shareholders (Score:4, Informative)

    by CrimsonAvenger ( 580665 ) on Tuesday January 08, 2013 @02:08PM (#42521355)

    They were perfectly free to reject the taxpayer bailout and look for money elsewhere.

    Umm, no.

    Even during the Bush Presidency, it was reported that the banks were given no choice about accepting the bailouts, since if any of the big banks refused, people might see some stigma if THEIR bank needed a bailout, pull funds, and go to a "safe" bank that hadn't needed a bailout (a banking panic was the last thing we needed then).

    So the first group of banks offered bailouts were told "I'm going to make you an offer you can't refuse"....

  • Re:Shareholders (Score:5, Informative)

    by DavidTC ( 10147 ) <<moc.xobreven> ... .vidavsxd54sals>> on Tuesday January 08, 2013 @07:39PM (#42525739) Homepage

    I'm seeing a lot of confusion in this article. Everyone needs to remember AIG IS NOT A BANK. AIG is an insurance company.

    AIG was not the people participating running the 'slice up mortgages and resell them' hot potato game that the banking industry had become. No, they were the people who cleverly looked at that with an outside eye and said 'Hey, would you people like to buy some insurance in case that entire insane stupid money orgy fall apart and everyone realizes it's all built on total shitpile mortages? You would! Alright!'.

    And then, astonishingly enough, it did fall apart, and AIG owned approximately a fifteen bajillion dollars to the banks that had purchased said insurance. Why, it's almost as if insuring trillions of dollars of completely idiotic business plans was a bad idea!

    They functionally did the equivalent of selling homeowner insurance to people who operated a drunken flaming torch juggling and firework-reselling business employing known arsonists. On top of their gasoline-soaked straw-roof lit entirely by candles. During a drought. Inside a forest fire. While the house was actually already on fire.

    And in a total surprise to everyone, those houses all burnt down and AIG had to pay for it all, and didn't have enough money. In a just universe, they'd be completely and utterly bankrupt.

    The problem is, they also insured, like, uh, everyone else. Car insurance, life insurance, retirement insurance, annuities, everything.

    And unlike the banking industry, which has things like FDIC insurance for deposits, there is no Federal bankstop if, for example, you die and your life insurance company can't cover the payout.

    So guess what we, the taxpayers, had to do?

Trap full -- please empty.