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The Securities and Exchange Commission and the Justice Department are investigating the way AIG valued credit-default swaps that wiped out profit for two quarters, the insurer said. The company had downplayed the potential for losses in December, then said Feb. 11 that its auditor found a "material weakness" in its accounting for the financial instruments.
The investigation comes two years after the company agreed to pay $1.64 billion to settle state and federal probes of reinsurance accounting and sales practices. AIG joins a growing list of firms facing government scrutiny over losses tied to subprime mortgages.
RETAIL
Wal-Mart Finds Silver Lining
Wal-Mart Stores is benefiting as rising gasoline, food and medical costs limit the amount U.S. consumers have to spend on everyday needs, chief executive H. Lee Scott Jr. said.
Those expenses are "eating up more and more from our customers' pockets," Scott told shareholders at Wal-Mart's annual meeting in Fayetteville, Ark. "Wal-Mart is uniquely positioned to succeed, not just in this economy, but in these times."
Wal-Mart said Thursday that May sales at stores open at least a year rose 3.9 percent, faster than it predicted, as lower prices on groceries, medicines and laptop computers attracted shoppers. Tax rebates also spurred sales as shoppers grappled with job losses and the worst U.S. housing market in a quarter-century.
Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.
