NEW YORK, Nov. 24 (UPI) -- U.S. prosecutors are investigating whether the head of American International Group manipulated the company's share price to cut the cost of a big acquisition.
Manhattan's U.S. attorney is concerned that AIG chief executive Maurice Greenberg may have violated criminal securities statutes shortly before AIG finalized its acquisition of insurer American General in August 2001, the Wall Street Journal reported Wednesday.
Sources told the Journal said that Greenberg reportedly called the office of the then-head of the New York Stock Exchange to ask for help in shoring up the stock's sinking price. Under terms of the $23 billion American General deal, AIG would have had to pay more in stock if AIG's share price dipped below a certain level in a 10-day period shortly before the deal was completed.
Traders working for a unit of Goldman Sachs started buying AIG shares, effectively keeping its share price above that certain level, the Journal reported.
