AIG agrees to pay $725M in settlement

Associated Press

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American International Group Inc. and some of its directors and officers have agreed to a $725 million settlement to resolve allegations of wide-ranging fraud laid out in a class-action suit led by three Ohio pension funds.

Ohio Attorney General Richard Cordray said Friday the latest figure will combine with previous AIG settlements reached with secondary defendants to pay about $1 billion to shareholders, including pensions representing firefighters, police, teachers, librarians and others. He characterized it as the 10th-largest securities-litigation settlement in U.S. history.

The lawsuit alleged anti-competitive market division, accounting violations, and stock-price manipulation by AIG between October 1999 and April 2005.

The federal government bailed out New York-based AIG in September 2008 as the financial crisis spiraled out of control. The insurer has received aid packages with a total value of $182.5 billion from the government.

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