Tuesday, December 30, 2008
This is the second of a three-part series on how AIG, one of the world's premier companies, became a fulcrum in the global economic crisis. AIG's impending collapse in September triggered the most expensive rescue of a private company in U.S. history.
The series is a narrative account of the 21-year history of AIG Financial Products, which became a powerful current in the much larger flow of events that led to the financial crisis. Part one, which appeared yesterday, dealt with events from 1987 to 1998. Today's story covers 1998 to 2005. On Wednesday, part three will report on 2005 through the present troubles.
The stories are based on internal records, public documents such as Securities and Exchange Commission filings, transcriptions of investor calls and conferences, and on-the-record interviews with current and former employees of AIG and its Financial Products unit, as well as government officials.
Descriptions of specific events come from the recollections of participants or transcripts. In some instances, Financial Products and AIG employees provided information or guidance, but did not want to be quoted by name.
Those speaking on the record in today's report include, among others, former Financial Products president Tom Savage, former AIG chairman and chief executive Maurice "Hank" Greenberg, former AIG vice chairman Edward Matthews, former AIG chief financial officer Howard Smith, former New York Attorney General Eliot L. Spitzer and the current superintendent of New York State's insurance division, Eric Dinallo.
Joseph Cassano, who served as Financial Products president from 2002 until earlier this year, declined to comment. F. Joseph Warin, Cassano's lawyer, spoke on his behalf.