The government’s rescue last month of American International Group Inc., parent of Hartford Steam Boiler Inspection and Insurance Co., is getting a critical eye from lawmakers examining the chain of events that forced a $700 billion bailout of the financial industry.
Three former AIG chief executive officers were scheduled to testify today before the House Oversight and Government Reform Committee, but one of them — Maurice “Hank” Greenberg, the company’s largest individual shareholder — canceled his appearance. Committee spokesman Karen Lightfoot said she did not know the reason for the cancellation, but CNBC reported that Greenberg had bowed out because of illness.
The hearing is the second in two days into financial excesses and regulatory mistakes that have spooked stock and credit markets and heightened fears about a global recession.
The Federal Reserve rescued AIG with the $85 billion loan Sept. 16, one day after investment bank Lehman Brothers declared bankruptcy when the government wouldn’t come to its aid. Lehman Brothers’ chief executive officer testified Monday before the congressional oversight panel but didn’t shed much light on how the mid-September events cascaded into a collapse of credit markets requiring a broad bailout.
