Monday, March 28, 2005

Lawyers Everywhere at AIG

The SEC has launched another set of subpoenas to twelve American International Group Inc. executives, on top of the scheduled deposition of former CEO Maurice Greenberg set for April 12, as part of an ever-expanding probe of the multinational insurance company.  In addition, another senior executive with close ties to Greenberg, Michael Murphy, apparently has been forced out of the company, and will likely be among those the various agencies investigating the company will seek to depose, assuming he does not assert the Fifth Amendment as two other executives have indicated they will (earlier post here). 

With the subpoenas flying around and the impending March 31 deadline to file its delayed annual report, AIG has retained law firms to conduct the internal investigation (Paul Weiss) and to advise the independent directors (Simpson Thacher).  The individual officers (both current and former) will most likely have their own separate counsel for any SEC depositions or interviews with state and federal investigators (civil and criminal), and some may assert the Fifth Amendment or work out plea/settlement agreements. Greenberg is being advised by Robert Morvillo, and Murphy's attorney is Sean O'Shea, both well-known in the white collar criminal defense area.  I suspect that at some point the halls of AIG will have more lawyers than you care to think about, and just imagine the hourly costs; the quote from Richard II should start popping up very soon. The Wall Street Journal has a story (here) about the continuing investigation. (ph)

                                                                                  

UPDATE (3/28): Former CEO Maurice Greenberg announced that he will be resigning in the next few days as non-executive chairman of AIG, according to a Wall Street Journal report (here).

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