AIG Fuzzy Accounting Unchecked by SEC

March 29, 2009 AIG’s accounting methods similar to Enron went unchecked by the SEC and the only one who seemed to be on the ball was Elliot Spitzer the Attorney General of New York State.

Without audits and proper financial accounting and no governance, no one would be stopping AIG from having two sets of books.

After all Bernie Madoff did the same in his ponzi scheme- he doesn’t know where the money went unless its offshore in the Caymans.

Maurice Greenberg CEO of AIG
 
Photo: Maurice Greenberg, CEO of AIG
Enron’s Ken Lay, was also another example of a very lax financial regulatory system since Bush with the help of republicans in congress, sought to change the rules and regulations governing Wall Street casinos during his administration. 
If Bush would have regulated the big banks of Wall Street or even instituted regulations that covered insurance swaps-which were a new device the meltdown, would not have happened to the whole world’s economy.

 

ken-lay4

Photo: Ken Lay -the man who led the fall of Enron

The practice of “cooking the books” seemed to be the order of the day under Bush’s administration and laws were abandoned by these titans of the US financial world.

Wall Street CEO’s laughed at the small penalties and fine payments from the SEC were seen as a resolution to the decay that prompted a world recession.

George Bush had a major ties with Ken Lay who was a heavy contributor to Bush’s election campaign and the money between Wall Street and the republican party is notoriously funding the corruption. 

Cooking The Books

 AIG helped Pittsburgh PNC fake its earnings by removing 762 million in loans from its figures on the balance sheet.

The whole tainted corrupt scandal points the finger at the head of SEC who has been absolutely clueless in finding, prosecuting, eliminating corrupt CEO’s and putting an end to AIG earlier.

Not only was the Securities and Exchange Commission asleep at the switch but the blames goes all the way up to the Department of Justice where heads should roll.

Ultimately our main offensive in the entire debacle was a man who is culture in competence and went after the corruption allowed by George Bush and that was Eliot Spitzer.

Is the the Bush administration who must bear the responsibility for the financial failure we are now facing in this struggling economy. The republicans are responsible for reducing regulations on default mortgage swaps which basically consisted of trading worthless mortgages on worthless paper.

The severance package for the current CEO Martin J. Sullivan who walked away from this mess with 5 million dollars and last year received a hefty 13.9 million dollars in compensation.

Elliot Spitzer -the man who could have stopped AIG
Elliot Spitzer -the man who could have stopped AIG

The company chief operating officer Martin Sullivan, 50 years old was promoted back in March 2005 when Maurice finally stepped down. Sullivan who has 20 years of experience himself would have or ought to have known the credit swaps were a severe problem since they comprised 40 percent a good chunk of AIG’s value.

Greenberg’s two son’s Jeffery Greenberg and Evan Greenberg spent their careers as part of AIG and left when their father who rules with an iron fist would not relinquish power at the age of 80 years old. 

In the long run Bush protected his friends by making it virtually impossible to bring charges against the executives who took great risks with investors and involved foreign banks to buy the fault insurance swaps who later would be reimbursed by the US government.  Nice con.

Share

Leave a Reply