The government took company equity without offering proper compensation.
Objections to AIG shareholders having their day in court to contest the terms of the government's takeover of their company are based on ignorance of the law and the facts.
OUR VIEW: So much for gratitude
The government loaned AIG money during the 2008 financial crisis — as it did many, many companies. As the government recognized in 2008, and recently admitted again, the loan to AIG was fully secured. The government also charged AIG 14.5% interest, much higher than the rate charged other assisted companies with better political connections
In addition, the government took (without a shareholder vote or consent) 80% of the company's equity without any compensation. The government then further harmed AIG's shareholders by using AIG's assets to conduct "backdoor bailouts" of other companies that the government wanted to stabilize, bailouts concealed from the public until congressional investigations revealed them.
All of the loans to AIG have now, of course, been repaid with interest. Unlike assistance to many other companies, the "rescue" of AIG did not cost taxpayers a penny — and because the loan was fully secured from the beginning, taxpayers were never at risk. In fact, the government has admitted that it made $22 billion in profits as a result of its takeover of AIG.
The Court of Federal Claims in Washington has already ruled as a matter of law that the government had no right to exact AIG's equity as a condition of loaning the company money — or to take AIG assets to conduct "backdoor bailouts" of other favored companies.
Moreover, the facts on which AIG's shareholders rely for their claims are largely undisputed, revealed in the government's own documents, and set forth in reports of numerous congressional committees and inspector generals.
The government has also recently admitted that it took AIG's equity not as compensation or collateral for the loan, but to "punish" AIG's shareholders for letting their company become a victim of the 2008 liquidity crisis. This admission further supports AIG's shareholder claims.
Trying to use ad hominem attacks to short-circuit a serious judicial proceeding is not a worthy goal.
David Boies is the lead attorney representing Starr International in a shareholder lawsuit against the government. Starr's chairman is Maurice "Hank" Greenberg, AIG's former chief executive.
Source: http://www.news.theusalinks.com/2013/01/09/opposing-view-give-aig-shareholders-their-day-in-court/
No comments:
Post a Comment