After 11 years of legal maneuvers, Hank Greenberg, the former head of insurance giant AIG, finally takes the witness stand on Tuesday. New York's Attorney General accused Greenberg of duping investors of half a billion dollars.
Greenberg built AIG from a small insurance underwriter to one of the largest companies in the world. Towards the end of his tenure, AIG participated in two transactions that hid financial shortfalls from investors and falsely boosted stock prices. But so far the government has yet to produce any documents proving Greenberg knew about it.
"We live in a document intensive world. The fact that you don't have anything to document it adequately is pretty harmful to your case."
John Despriet, a securities defense lawyer at Womble Carlyle, says Greenberg was known for holding tight reins at AIG. The government is expected to ask Greenberg directly how he could possibly run the company without knowing about these transactions.
