AIG CEO says “Trust us to self-regulate”

Posted on June 24, 2011


This week, when asked for his opinion on financial reform, AIG CEO Robert Benmosche said banks and investment firms shouldn’t be subject to forced government regulation, and that the country’s financial institutions should be trusted to “row their boats in a manner they see fit.”

“Right now, the most important thing is that we’ve got to get companies to regulate themselves and to do the right thing,” Benmosche said. “The only way that can happen is if we let the financial experts run their own operations, without the intervention of a federal government that clearly doesn’t know how to control its finances.”

In 2008, AIG required a $180 billion bailout package in order to stay afloat after the company teetered close to collapse as a result of its own greed, avarice and schlock in-house accounting practices. Prior to the collapse, the company had insured $441 billion worth of mortgage-backed securities for Wall Street banks in the form of credit default swaps. When the system imploded, AIG became the big insurer that couldn’t keep up. When AIG received the $219 Billion, what’s the very first thing they did with the bailout money?  They paid their senior executives more than $170 Million in bonuses.

Still, Benmosche defends investment banks, saying the practices employed that led to the nation’s fiscal meltdown were not criminal, but simply the result of bad management.

“It could be just sloppy underwriting, it could be sloppy business,” Benmosche said. “And that’s just not illegal, unless you portray something one way and you knew it wasn’t.”

Right … it COULD have been sloppy business. But it wasn’t. It was a collective of Armani-suited sheisters and thieves stuffing their pockets with customer and taxpayer cash for as long as the gravy train lasted. And now, here’s one of those thieves who benefitted most from the haul, saying that we – the American people – should forget what they did THEN and trust them to do the right thing NOW.

In a letter written by Representative Joe Courtney (D-CT) and co-signed by 78 other members of the House of Representatives, the Congressman was especially critical of AIG.

“This company, more than any other single entity, is responsible for the crash of world credit markets,” Courtney wrote. “AIG has shamelessly lined up for a $219 billion handout only to be used to cover up its own incompetence and irresponsible business practices.”

Benmosche, since taking over the firm in 2009, has had a bit of a rocky public profile. He reportedly told AIG employees that if Congress requested he testify before them, he would reply that they should “stick it where the sun don’t shine.” He also reportedly threatened to resign over government pay restrictions.

Right … how DARE the American taxpayers be so arrogant as to think they should have a say in how $180 Billion of their dollars should be spent.

The wheels on the armored car go round and round.

Posted in: Errata