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Ex-CEO Greenberg: Don't blame me for AIG failure

Published on NewsOK Modified: February 28, 2013 at 10:56 am •  Published: February 28, 2013

NEW YORK (AP) — Four and a half years after insurance giant AIG collapsed, leading to the biggest bailout of the financial crisis, former CEO Hank Greenberg has one message: Don't blame me.

Greenberg is the man who spent nearly four decades building AIG into a global insurance power. AIG is the company that nearly collapsed under the weight of toxic mortgage securities and insurance contracts and had to be rescued by the government.

In a new book, "The AIG Story," Greenberg faults others for those failures. In his version of the company's history, he's a hero and a victim.

Greenberg was gone by the time AIG nearly failed in 2008, having been pushed out three years earlier during government investigations into accounting irregularities. He blames his successors for the company's implosion and scoffs at any suggestion that he might have created the conditions for it.

In his book, which he co-wrote with George Washington University professor Lawrence Cunningham, he paints himself as a sort of superman of business, politics and relationships. He bans the three-martini lunch popular among executives. He delves into new business endeavors, like insurance against kidnapping. At a resort, he skis down a mountain to warn other executives that the gondolas have come loose. He meets Mikhail Gorbachev and argues so winningly for capitalism that Gorbachev "turns and walks away."

Greenberg lost his job in 2005, when AIG's board forced him out after New York's attorney general, Eliot Spitzer, accused the company of accounting irregularities. Greenberg denies he did anything wrong. He says he was removed by paranoid directors who cared more about themselves than the company.

In an interview with the Associated Press at his Park Avenue office in Manhattan, Greenberg, 87, criticized new banking regulations and explained why he's suing the government for $25 billion. Questions and answers have been edited for clarity and length.

Q. What do you think of the current era of financial regulation?

Look, I think Dodd-Frank was a mistake when they enacted it. Virtually none of the committees who are investigating what happened have reported their findings, so it's like shooting, then aiming afterward. And it's going to hurt our economy. It's going to hurt growth. That doesn't mean you don't need regulation. You need enlightened regulation.

After (the collapse of) Enron, the pendulum swung in one direction. Boards of directors gained more power over companies, over management. Boards can't run companies. You minimize the importance of the CEO and the senior management and you've essentially disabled the company.

Q. Isn't the board supposed to stand up for shareholders?

The board's also supposed to stand up for management.

Q. Are you saying that everything bad at the company happened in the three and a half years after you left? Nothing happened while you were in charge that set it up for its near failure?

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