These financial guys are Major Users. They play off each other---sophisticated mind games to get a specific reaction. They then turnaround and use other person for The End Game........ to enrich themselves. Very much in evidence when Lehman's Fuld testified before Congress yeaterday.
Does your lefty friend trust Bernanke, too (snicker)?
" Golly Ben, bailing out hedges and other greedsters who bought Fannie frauds is hard work."
"Keep bailing, Paulson."
(2005) Court Papers Detail Bonuses at A.I.G.
(company registered in Panama-—offshore mney-launder haven)
By LYNNLEY BROWNING, NY TIMES, May 19, 2005
Fresh details have emerged in court papers about the inner workings of a private offshore company that had been paying big bonuses to top executives of the insurance giant American International Group (AIG). The company, Starr International, awarded tens of millions of dollars in payouts over a two-year period at a time when it was ineligible to do so under its own operating laws, according to the court papers, which cite internal A.I.G. documents. The new details are contained in an amended lawsuit that was filed late Tuesday in Delaware Chancery Court by a Louisiana pension fund that is suing A.I.G. and its directors over what it calls questionable dealings. Those dealings are said to include undisclosed related-party transactions conducted by A.I.G. with StarrInternational and with another A.I.G.-affiliated private company, C. V. Starr & Company.
Starr International, which is registered in Panama, is A.I.G.’s largest shareholder, with nearly 12 percent of A.I.G. stock, now worth around $16 billion. The company is run by A.I.G.’s recently ousted chairman and chief executive, Maurice R. Greenberg, and by a handful of other senior former A.I.G. executives, all hand-picked by him. Mr. Greenberg is president and chief executive of Starr International, and owns about 8.3 percent of the private company.
Federal and New York investigators have been looking at the Starr affiliates as part of their investigations into questionable transactions by A.I.G. Starr International, according to A.I.G.’s 2000 annual report, is not supposed to set aside A.I.G. shares for executives during any two-year period in its compensation plan when A.I.G. does not report growth in its earnings per share. Nevertheless, when A.I.G. had no such growth around 2000 and 2001 because of claims stemming from the Sept. 11 terrorist attacks, Starr International set aside Shares totaling $41.7 million, the court papers say. A spokesman for A.I.G. declined to comment.
Even though Starr International had been a long-term incentive compensation pool for A.I.G.’s top 700 executives and managers, all of its payouts were decided upon within the private company, without the participation or approval of A.I.G.’s own executive compensation committee, according to the court papers.
The pension fund, the Teachers’ Retirement System of Louisiana, filed its original complaint in December 2002, but amended its lawsuit to include charges of breach of fiduciary duty stemming from questions raised since then by investigators, as well as from various settlements and announcements by A.I.G. In March, A.I.G. made an extraordinary disclosure that “internal mismanagement” and “improper accounting” had bolstered its results, and said earlier this month that correcting those errors would shave $2.7 billion of net worth from the company. A.I.G. also said that it would begin expensing Starr International’s compensation as required by standard accounting practices, something it had not done previously.
The amended complaint now includes the second private company, C. V. Starr, as a defendant. Stuart Grant, an attorney at Grant & Eisenhofer, the Delaware law firm representing the pension fund, declined yesterday to say why Starr International was not also a defendant. In an unusual move, the amended complaint asks the Delaware judge overseeing the case to place the assets of C. V. Starr in a court-appointed trust, for the benefit of A.I.G. shareholders.
C. V. Starr is a lucrative private holding company owned and run by top A.I.G. executives and incorporated in Delaware. It is known internally within A.I.G. as “the billionaires club,” according to the complaint. C. V. Starr sells specialized insurance policies with A.I.G.’s name on them and, according to previous court papers, had a net profit of $102 million from 1999 through 2002. C. V. Starr pays its approximately 80 partners, all A.I.G. executives, undisclosed dividends and benefits from its undisclosed profits.
The pension fund argues that all of the money paid by A.I.G. to C. V. Starr, in the form of various commissions, should go to A.I.G. shareholders, since A.I.G. can do the work that C. V. Starr does. The amended complaint discloses that A.I.G. paid direct commissions to C. V. Starr of $495.2 million from 1999 to 2003. The figure is $24.5 million more than A.I.G. disclosed to shareholders in its own S.E.C. filings, according to the complaint. Direct commissions are payments for the production of business.
When a guy like Buffet, or Pickens or Soros takes any kind of public position, there is something in it for them financially. Gore too.