"The board and current management of the company are now cooperating with this investigation," Mr. Spitzer's office noted. "Based upon these efforts, and based upon our knowledge to date, we believe that a civil resolution with the corporation will ultimately be achievable."

Mr. Spitzer's remarks came just one day after AIG released a letter sent by the company to shareholders announcing that the company board of directors and new management are undertaking "numerous actions" relating to the regulatory inquiries and an internal investigation.

"We have been working closely with regulators and other authorities to ensure that everyone throughout the organization complies with AIG's policy of full cooperation with all investigative efforts, both internal and external," said the letter, which was signed by AIG's chief executive officer, Martin Sullivan.

"Among other things, AIG has been briefing the authorities on the progress of its internal review, providing documents and information, and assisting in making company personnel available as necessary."

The letter also discussed efforts by AIG to preserve and disclose documents relevant to the investigations being undertaken by Mr. Spitzer's office and the Securities and Exchange Commission, including the disclosure to authorities of efforts to remove documents from the company's Bermuda location.

Additionally, the company acknowledged that an employee in the Bermuda office had been terminated for refusing to cooperate with an AIG investigation and that several others had resigned. Other employees who do not cooperate fully with the investigations, the letter said, could also be terminated.

"We are committed to improving transparency and corporate governance, and we want to have an open and constructive dialogue with our regulators," the letter said. "At the same time, it is unfortunate that current circumstances have obscured the reality that AIG's unique global franchise is sound, our financial position is solid, and cash flow remains strong. Most important, our managers and employees around the world have stayed focused on the business, demonstrating remarkable resilience, integrity, and commitment under challenging circumstances, thus meriting the continued confidence of our customers, agents, and producers."

Prior to these events, AIG's stock had tumbled 8 percent on Friday.

Mr. Spitzer issued his statement around noon Monday, but the stock opened higher on the basis of analysts' projections that AIG itself would not be indicted, even though certain employees or officers might. Among the analysts was Ronald Frank of Smith Barney.

Mr. Frank said that, "We continue to view criminal prosecution of AIG (as opposed to that of individuals), fear of which apparently accelerated the stock's decline to a two-year low on Friday, as an extremely remote possibility."

In his note to investors about AIG, Mr. Frank said, "We cannot establish a precise worst-case scenario for AIG under the current circumstances, hence our ?high risk' rating on AIG. However, we do not view AIG's strong business model, based on global diversification and market leadership, as being broken."

Probes by Mr. Spitzer and other regulators into AIG's business practices have proven to be costly for the world's largest insurance company. Investigations forced AIG's long-time chief Maurice Greenberg to relinquish his titles, first as chief executive and then as the non-executive chairman.

AIG has lost about $51 billion of market value since Feb. 14, when it was announced that AIG was subpoenaed by Mr. Spitzer's office and the Securities and Exchange Commission.

Additional Reporting by Matt Brady and Arthur D. Postal