If You Could Ask AIG CEO Edward Libby a Question, What Would it Be?

If you could ask AIG CEO Edward Libby a question, what would it be? Sound too good to be true? Think again.

Tomorrow, March 18th, 10 am, EST, the House Financial Services Subcommittee, Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, is holding a hearing, American International Group’s Impact on the Global Economy: Before, During, and After Federal Intervention.

Congressman Paul E. Kanjorski (D-PA), Chairman of the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, today announced that the Subcommittee will hold a hearing to fully examine the American International Group (AIG), how it got into its current situation, why it has received so much federal assistance, and how to move forward.

“The federal government has provided AIG with access to well over $150 billion in federal aid to protect the global economy,” said Chairman Kanjorski. “Unfortunately, taxpayers do not understand how AIG ended up in such a terrible situation, nor do they understand why the federal government continues to give it money. We must assess AIG’s progress, as well as how we move forward to ensure that any taxpayer money AIG receives is spent efficiently and effectively.”

Look who is testifying!

  • Mr. Edward M. Liddy, Chairman and Chief Executive Officer, American International Group
  • Mr. Rodney Clark, Managing Director, Insurance Ratings, Standard & Poor’s

So, please post in the comments what you would ask either of these people.

Here is what I would ask:

  1. Are you winding down CDS, CDO, CLO issuances, new sales?
  2. Have you fired anyone in the London financial instruments division?
  3. Recently AIG released a memo claiming systemic risk. Yet, the recent payout disclosures imply CDS payouts to other parties is the real use of TARP funds and the traditional regulated insurance business of AIG is secure, stable and profitable.
    • Isn't it true one can avoid systemic risk by breaking up AIG into the profitable, stable businesses and isolate the derivatives products division?
    • Where is the proof that allowing these derivatives, CDSes, CDO, CLOs to not be paid out would cause massive systemic risk to the point of global economic collapse? Isn't this document just a little too close to a scare tactic?
  4. Have you done an internal audit and review of your London financial instruments division? Will you make these results public?
  5. What are you doing to remove collateral triggers?
  6. Many of your payout counter parties are TARP recipients. Has their been any negotiation to a percentage of the original payout obligation in order to reduce the cost to taxpayers?
  7. Who approved some of these structured financial investment vehicles, like CDSes, CDOs, CLOs in the first place? What have you done to clean up AIG from these fraudulent vehicles and bad practices?

Ask your questions in the comments. Seriously, you just don't know who will read your post and if you do not ask, you will not be heard.

Update: One can watch the hearing on CSPAN. One piece of information is Libby claims the entire risk of the fictional derivatives out of the London Financial Branch has been reduced from $2.7 trillion dollars to $1.6 trillion dollars.
That is a key element in this mess, beyond the fact payouts look like a circle jerk on these various financial instruments, but to wind down those beyond belief stupid, fictional derivative based structured finance vehicles.

More later.

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What are the hurdles they are experiencing

with selling off divisions/assets? Is there a lack of agreement on price - difference in evaluations?

What is his position on AFSME's shareholder proposal with tying executive compensation to long-term profits?

get a link to AFSME proposal document?

exec. compensation reform there are numerous proposals...

I'm pushing Gomory's complete corporate law overhaul agenda personally but exec. compensation incentives is obviously a notorious problem to incentivize everything from layoffs to bad mergers to bad management.

but give a link to any relevant document, esp. any details.

Here is the summary from press release


I will look for details. Interestingly, the three trustees appointed by Fed to serve on AIGs board have refused to say whether they would support the shareholder proposal.


there are reports of these financial people who are demanding executive bonuses threatening to leave AIG, hedge against it. Is this not criminal, use of insider trading as well as violation of their NDA and confidentiality agreements? Will AIG promise to sue these employees as well as alert the DOJ and Interpol to any criminal activity or wrong doing in this case?

To Ed Libby, CEO, AIG Insurance

I think you are a "Patriot" to take this heat from our "do as I say not as I do" Congressmen at this recent hearing on the Hill for only $1 a year as salary. I admire your backbone and willingness to serve our country in this tragic state of the economy. I commend those who received and are willingly returning their bonuses and I respect you for looking out for your people who are not as eager to part with the dough by not revealing their names for obvious safety. Unfortunately, there are just too many ignorant Americans who hear only part of the story before going on rampage and wanting to lash and kill someone. If only they would take the time to become fully informed. In addition, I think a great many of our Congressmen are "Pinheads" and are in need of a comeuppance. Their votes on all the raises in salary and exhorbitant benefits is no different, in my mind, than what they're accusing those receiving these bonuses of. Look how terribly they've failed us, their greed, lies, deceit, personal conduct unbecoming of a Congressmen; their behavior is certainly not what I would consider to be worthy of a role model. They are using AIG as scapegoats for their own incompetence!!! Their behavior was despicable!!! I'm embarrased that they are supposedly our nation's leaders!!!