The trial of three former General Re and one former AIG official–stemming from a finite reinsurance deal alleged to have been used to inflate AIG's earnings–has been moved to Connecticut from Virginia, meaning the trial most likely will be delayed from its current May 22 start date.
Federal District Court Judge Gerald Bruce Lee, of the Eastern District of Virginia in Alexandria, signed an order March 30 moving the trial to Connecticut–likely New Haven or Bridgeport.
The defendants–former Gen Re executives Ronald Ferguson, Elizabeth Monrad and Robert Graham, and former AIG executive Christian Milton–were indicted Feb. 16 in Norfolk, Va.
Judge Lee had ordered a prompt trial in the case as part of the venue's policy of speedy trials. Some lawyers for the defendants said they expected the trial to be delayed as a result.
However, Paul Schectman of Stillman and Friedman in New York, the lawyer for Ms. Monrad, said such speculation is premature. “We will have to wait until we get there to see what the new judge in the case will do,” he said.
Mr. Ferguson was formerly CEO of Gen Re, a subsidiary of Berkshire Hathaway. Ms. Monrad was Gen Re's former chief financial officer, while Mr. Graham was the reinsurer's assistant general counsel. Mr. Milton was AIG's former vice president of reinsurance.
The 13-count indictment includes charges of conspiracy, securities fraud, making false statements to the SEC, wire fraud and mail fraud.
The indictments were the result of alleged sham reinsurance transactions used to pump up AIG's reserves and stock price. The deals at issue, according to the indictment, began in 2000 after AIG stock prices dropped and the company encountered negative analyst reports.
According to a previous filing in a guilty plea last year by John Houldsworth–former CEO for Gen Re subsidiary Cologne Re Dublin–AIG's former chairman and CEO Maurice Greenberg called Mr. Ferguson requesting that Gen Re lend AIG up to $500 million in reserves on a short-term basis through a loss-portfolio transfer without transferring any risk of loss to AIG. Mr. Greenberg is not named in the indictment.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
