AIG Officials Sued Over Subprime Exposure
NEW YORK (Reuters) - An American International Group Inc (AIG.N) shareholder sued several of the company's officials on Tuesday over the insurer's exposure to the subprime mortgage crisis.
Doris Staehr, of California, alleged that AIG under the direction of its officials, including Chief Executive Martin Sullivan and Chief Financial Officer Steven Bensinger, improperly concealed the extent of its exposure to the subprime mortgage crisis, according to the complaint in U.S. District Court in Manhattan.
"Defendants claimed that AIG's portfolio was so sufficiently diversified that the mortgage market would have to reach 'Depression proportions' before negatively impacting the company," the complaint alleged. "AIG was not as invulnerable as defendants claimed, however."
AIG, the world's largest insurer by market value, reported a 13 percent fall in third-quarter profit earlier this month, caused in part by its exposure to the crippled mortgage market.
The complaint alleged that results were hurt by about $1.4 billion in losses in AIG's investment portfolios and mortgage insurance business.
Staehr filed the complaint against the officials on behalf of the company, alleging breaches of fiduciary duties, unjust enrichment and other charges for actions between May 2006 and now.
An AIG spokesman said he had no immediate comment as he had not yet seen the complaint.
(Reporting by Paritosh Bansal; Editing by Brian Moss)
