U.S. probes AIG executives-law enforcement source (for securities fraud)

[UpInArms]

Source: Reuters

NEW YORK, Sept 11 (Reuters) - U.S. investigators are probing the former head of American International Group Inc's (AIG.N) Financial Products unit, Joseph Cassano, and other executives for securities fraud, a law enforcement source familiar with the case said on Friday.

The source said that a grand jury may be impaneled this month in New York to consider potential charges that executives failed to disclose the value of toxic assets to the bailed-out insurance company's outside accountants and shareholders.

"The investigation is really who knew what and when about these assets," said the source, who asked not to be identified because the probe was ongoing. "They were holding toxic credit default swaps and may not have disclosed their real worth."

A spokesman for the office of the U.S. Attorney in Brooklyn, New York, where the grand jury would sit, declined to comment. The U.S. Department of Justice and the U.S. Securities and Exchange Commission in Washington also declined to comment.

Cassano, who left AIG under a cloud in 2008, could not be reached for comment. Cassano's lawyer, F. Joseph Warin of the Washington, D.C. law firm Gibson Dunn, and AIG declined to comment.

The losses from subprime mortgage investments left AIG on the verge of bankruptcy last September. The U.S. government stepped in at the eleventh hour to rescue the firm with a bailout package that has since swelled to as much as $180 billion, after officials deemed the company too big to fail.

Read more: http://www.reuters.com/article/bondsNews/idUSN1144867720090911

[Tansy_Gold]

1. Just an observation --

If AIG wasn't, in fact, "too big to fail" a year ago, that infusion of 180,000,000,000 of our dollars makes it so now.

I am staunchly anti-death-penalty and ohter forms of cruel and unusual punishment, but I don't think I'd protest if Cassano and his ilk were convicted and sentenced to hundreds and hundreds and hundreds of years of solitary confinement and hard labor. I might, but I don't think so.



Tansy Gold, who really is not a very bloodthirsty or vengeful person. . . . most of the time.