The requests for material arrived following the company's earnings call last Wednesday, AIG said.

In a two-paragraph announcement the company said the subpoenas related "to investigations of nontraditional insurance products and certain assumed reinsurance transactions and AIG's accounting for such transactions. AIG will cooperate in responding to the subpoenas."

AIG's previous problem concerning nontraditional insurance sales was concluded Dec. 2, 2004, when the company reached a settlement with the Justice Department and the SEC. At that time the company said it would undergo an examination of its transactions by an internal committee and an outside monitor to ensure compliance with accounting rules.

The cost of the settlement with penalties and fees was $126 million to settle charges AIG allegedly helped two companies distort their financial statements through the use of nontraditional insurance and transactions arranged by its AIG Financial Products units.

AIG said then that while it did not admit or deny wrongdoing, it had reached a settlement to resolve allegations that resulted from transactions that AIGFP structured with PNC Bank in Pittsburgh.

Another portion of the settlement ended Justice Department criminal investigations concerning both the PNC transactions and Brightpoint, a Plainfield Inc. phone distributor.

The Brightpoint deal was written by AIG's Loss Mitigation Unit and involved insurance designed to spread a large loss over a number of years. The SEC said the transaction amounted to a disguised loan.

The PNC dealings involved transactions known as C-GAITS (Contributed Guaranteed Alternative Investment Trust Security). C-GAITS were essentially designed to take $762 million in bad loans and lagging venture capital assets from the bank's balance sheet, transferring them to a special-purpose entity.
Stephen M. Cutler, SEC enforcement division director, said last December that "AIG was reckless" in not knowing that the C-GAITS product it developed did not satisfy accounting standards. The SEC action, he said, is "a message to insurance companies and others that sell structured finance or other products to public companies that are designed for no purpose other than to improve those companies' accounting results."

"In appropriate circumstances, marketers of such products will be held liable for the resulting misstatements in their customers' financial disclosures," he warned.