Jul 20, 2010

MUST READ: Akron Beacon Journal Lauds Cordray-Led Settlement Against AIG

AKRON – The Akron Beacon Journal editorial board praised the Attorney General Rich Cordray's office for taking on AIG’s greedy practices that hurt Ohio pension funds. This settlement is the latest in a series of victories for Ohio investors, consumers and small businesses thanks to Rich Cordray’s leadership in taking on Wall Street greed. Excerpts of article follow:

“In Ohio and around the country, millions of workers and retirees have watched in dismay, their retirement goals upended, as pension funds lost billions of dollars in investments with companies such as American International Group, AIG. With some luck, three pension funds in Ohio will recoup some of their losses after reaching a $725 million settlement with AIG last week in a class-action lawsuit.

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“Represented by the Ohio Attorney General's Office, the lead plaintiffs in the case, Ohio Public Employees Retirement System, the State Teachers Retirement System and the Ohio Police and Fire Pension Fund, charged that AIG manipulated stock prices, rigged bids, played fast and loose with accounting and engaged in other fraudulent practices that cost the three funds and other investors huge amounts of money from 1999 to 2005.

“The agreement requires the insurance giant to pay $175 million within 10 days of the court approving the deal. The company plans to pay the remaining $550 million by offering common stock early next year. The plaintiffs can resume the lawsuit if AIG fails to pay up. Together with previous deals, Ohio has won more than $1 billion in settlements from AIG. According to Richard Cordray, the state attorney general, this represents the 10th largest securities settlement in U.S. history.

“The settlement is sweet victory, to be sure. The long litigation by Ohio serves strong notice to other financial institutions that state funds are prepared to pursue aggressively their options for redress.

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Read full article here.

Read more about the settlement here.

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