Los Angeles Superior Court receives AIG shareholder lawsuit

2009-04-03 20:03:12 (GMT) (JusticeNewsFlash.com - Business Litigation, Justice News Flash)

Wiki Image:AIG sued by retired judge in L.A. for shareholder fraud

Southern California based AIG executives named in legal action by shareholders.

Los Angeles, CA (JusticeNewsFlash.com)–As reported by the Associated Press (AP), a lawsuit was filed on Wednesday in Los Angeles Superior Court against American International Group, Inc. (AIG) www.AIG.com. Lawyers, specializing in business litigation and fraud, filed the legal action on behalf of the major American insurance corporation’s shareholders. The fraud claim was filed by a retired California judge in seeking unspecified damages.

Los Angeles Superior Court documents reveal the suit names several Southern California based company executives. Securities fraud litigation attorneys allege the insurance giant overpaid workers by knowingly and fraudulently reporting inflated revenue. AIG is accused of falsely citing the billions of dollars in bonus payments were necessary to keep employees from leaving. Corporate documents have become public revealing $57 million was already set aside as retention pay to employees that AIG had already decided to fire.

AIG, has been under fire by American consumers and the Obama Administration for receiving $70 billion in direct federal bailout money and billions more in loans, and then paying out billions in corporate bonuses in a nationwide recession. The legal action which attorneys state is based on previously undisclosed information, public filings, government documents, and news reports asserts company executives created a bonus compensation program to guarantee payouts. Apparently, company leaders knew its businesses were faultering because of continued fraudulent activities. AIG is accused of knowingly participating in fraud activities for five years and accepted $175 billion in taxpayer direct funds and loans to maintain their business and securities fraud schemes.

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