Did AIG Cheat New York Workers Compensation Board?Friday, April 29, 2005
On April 26, 2005, New York Attorney General Eliot Spitzer announced an investigation of alleged improper booking of workers compensation premiums at insurance giant American International Group (AIG). This continues the problems at AIG, where last month CEO Maurice “Hank” Greenberg was forced to resign in the midst of various financial probes.
The New York State Workers Compensation Board and the Workers Compensation Security Fund are financed by an assessment on insurance companies based upon their written premiums. The theory is that the largest insurance carriers, based upon workers compensation premiums charged to employers, should pay a larger proportion of operation and fund expenses. It is alleged that AIG shifted legitimate employer “workers compensation premiums” to “general liability premiums” to avoid having to pay their fair share of Workers Compensation Board expenses.
How do these financial workers compensation shenanigans affect you? If the Workers Compensation Board or the Workers Compensation Security Fund goes broke, the taxpayer will be forced to pay the financial bail out. In the post-Enron world, we now know that the little guy gets stuck with the bill. The CEOs escape real punishment and leave town with billions. Want to know AIG ex-CEO GreenbergÄôs net worth?