A special inquiry reveals at least one bank offered to cancel insurance contracts with the firm for less than the government paid
A special inquiry in the US raised questions about the way officials handled the multibillion dollar bale out of troubled insurance giant American International Group (AIG), reported the Associated Press.
Special Inspector General Neil Barofsky said government officials may have overpaid banks to wind down AIG’s business relationships.
The federal Bank of New York paid AIG’s business partners full face value for securities so they would cancel insurance contracts in order to ease the firm’s liquidity crunch. But Barofsky said at least one of the banks offered to cancel the contracts for less, according to AP.