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Amid public rage, AIG opts out of US government lawsuit

Published on Jan 10, 2013 6:28 AM
 
The AIG headquarters offices are seen in New York's financial district, on Jan 9, 2013. The board AIG decided on Wednesday not to join a lawsuit against the United States (US) government over the terms of the company's bailout, following two days of fevered backlash from Congress and the public over the prospect. -- PHOTO: REUTERS

(REUTERS) - The board of American International Group (AIG) Inc decided on Wednesday not to join a lawsuit against the United States (US) government over the terms of the company's bailout, following two days of fevered backlash from Congress and the public over the prospect.

AIG had been weighing whether to join a lawsuit filed by its former chief executive, Mr Hank Greenberg, and his company Starr International, which owned 12 per cent of the insurer before its 2008 rescue.

Mr Greenberg alleges the rescue was unfair to shareholders, and that the Federal Reserve Bank of New York charged an excessive interest rate on its initial loan. He has sought billions of dollars in damages.

AIG said the board carried out its legal and fiduciary duty to consider the possibility of joining Mr Greenberg's suits before making its decision.

 
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