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Former Exec Says AIG Defrauded U.S. in Bailout; Government Declines to Join Suit

American International Group Inc. defrauded the U.S. by failing to disclose it was selling insurance without a license during negotiations with the government over a bailout in the financial crisis, a former executive claimed in a lawsuit.

By Bob Van Voris, Bloomberg | Updated on May 14, 2014

(Bloomberg) — American International Group Inc. defrauded the U.S. by failing to disclose it was selling insurance without a license during negotiations with the government over a bailout in the financial crisis, a former executive claimed in a lawsuit.

Alex Grabcheski, a former human resources executive at an AIG unit, filed the suit in Manhattan federal court in 2010. Grabcheski’s claims under the federal False Claims Act became public today after the U.S. government declined to join his suit, according to court records.

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