AIG hires ex-Lehman lawyer as compliance head

NEW YORK (Reuters) - Bailed-out insurer American International Group Inc AIG.N has hired a former Lehman Brothers Holdings Inc LEHMQ.PK lawyer as deputy general counsel, overseeing global compliance and regulatory strategies.

David DeMuro, will join AIG as vice president, head of compliance and regulatory affairs and deputy general counsel, said Thomas Russo, AIG’s general counsel and another former Lehman staffer, in a memo to employees on Tuesday.

DeMuro, who was most recently senior counsel at law firm O’Melveny & Myers LLP, will direct the activities of AIG’s compliance and regulatory staff, provide a strategic view of regulators across operations, and oversee how that affects the company’s regulatory priorities, Russo said.

DeMuro spent more than two decades at Lehman Brothers, the last 10 as head of global compliance and regulation. He began his career at the U.S. Securities Exchange Commission, working in various capacities on enforcement issues.

Russo joined AIG in February, as Chief Executive Robert Benmosche tries to deepen the management bench at the insurer, which is nearly 80 percent owned by the U.S. government after receiving a $182.3 billion taxpayer-funded rescue package.

Lehman went bankrupt in September 2008, and was followed the same week by AIG’s near-collapse and bailout.

Russo also said Karen Nelson was named chief compliance officer after acting in that role since January. She will report to DeMuro.

Reporting by Paritosh Bansal; Editing by Dhara Ranasinghe