Three former executives at Berkshire Hathaway's General Re insurance unit and a former American International Group executive have been indicted by a federal grand jury on charges of fraud and conspiracy, the Justice Department announced Thursday.
The indictment was returned Wednesday by a grand jury in Norfolk, Va., charging the former executives with conspiring to make AIG's finances appear better than they were.
Those charged are: Ronald Ferguson, who was General Re's chief executive; Elizabeth Monrad, the former chief financial officer; Robert Graham, the company's former assistant general counsel; and Christian Milton, who ran AIG's reinsurance division.
The defendants put together a sham reinsurance transaction that allowed AIG to fraudulently report about $500 million in loss reserves "to mislead AIG's shareholders, stock market analysts and the investing public," the indictment said. The conspiracy was designed to make it appear AIG's loss reserves were growing in order to pump up the price of AIG stock, according to the indictment.
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