THAT WACKY AIG

AIG is a pretty wacky company.

AIG has just been “saved” by the U.S. taxpayers, who now hold an 80% stake in the company while AIG attempts to reorganize and sell off some of its component businesses (AIG may or may not sell off some of its insurance subsidiaries who write California comp coverage).

AIG has been a major player in California workers comp, and a major contributor to Governor Schwarzenegger. So I’m giving them a bit of focus during the economic meltdown . Recently I covered news about their swanky conference held right after the bailout.

But the strange news about AIG just keeps coming.

The company is under pressure to recover millions in payouts to executives.

In the last few days we learned that on September 16, 2008-the DAY AFTER the rescue of AIG-AIG lobbyist Brett J. Ashton was meeting with state regulators in Indiana in an effort to relax recently enacted oversight rules governing mortgage originators, known as the SAFE Act (the Secure and Fair Enforcement for Mortgage Licensing Act of 2008. Lax oversight over mortgage originators was one of the big factors in how the current U.S. housing and economic debacle began, of course.

Again….the DAY AFTER the AIG bailout, they are at it, seeking to ease regulatory oversight.

Yes, AIG is not alone. Other financial firms already appear to be engaged in an effort to undermine oversight rules. But stats show that AIG is the biggest spender on lobbying activities

All of this was revealed in an October 16 Wall Street Journal investigatory piece by Elizabeth Williamson.

Several weeks later, Brett J. Ashton was briefing colleagues in the mortgage finance industry at the Beverly Hilton conference of the American Financial Services Association.

The Wall Street Journal noted that Ashton referred questions about his activities to an AIG spokesman, who defended AIG’s right to maintain lobbying activities (“government affairs”). They do have that right. They exercised it to the tune of $3 million on federal government lobbying in the 2nd quarter of 2008 alone.

But since AIG is now essentially a ward of the U.S. taxpayer, fighting oversight of mortgage originators is a PR debacle. If the Journal’s story is correct, it’s time for a pink slip for Brett J. Ashton.

But just when you think it can’t get worse, it does.

London’s tabloid paper, News of the World, recently went undercover to
an AIG sponsored partridge hunt at an English country manor, spending thousands of dollars on lodging, rare wines and private jets. Get a load of this:
http://www.newsoftheworld.co.uk/news/article43510.ece

That’s AIG. You, the taxpayer, now own it. And they continue to be a big player in California workers’ comp.

Julius Young
www.boxerlaw.com
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Category: Political developments