New York, NY: Another day, another large company allegedly violating ERISA laws. This time, the company in question is AIG (American International Group Inc.). AIG faces multiple lawsuits regarding its handling of employee investments.
While one lawsuit is near settlement, the other is just getting under way.
AIG may have settled one class action lawsuit. On July 3, 2008, a judge granted preliminary approval of a Settlement Agreement between AIG and a group of plaintiffs who filed an ERISA lawsuit against the company. The lawsuit involves participants or beneficiaries of the AIG Incentive Savings Plan, the American General Employees' Thrift and Incentive Plan, the American General Agents' and Managers' Thrift Plan and the CommoLoCo Thrift Plan. Plaintiffs in that lawsuit alleged that AIG breached its fiduciary duty by failing to prudently and loyally manage the plans and the plans' assets, failing to provide participants with accurate information and knowingly participating in a breach of duty.
As part of the settlement, AIG will pay $24.2 million in cash. A Fairness Hearing will be held in October to determine whether or not to grant final approval of the settlement. The lawsuit included plan participants of various dates up to May 31, 2005.
AIG now faces a new lawsuit that alleges the company overstated its earnings and lied to investors about the stability of its plans. The company allegedly assured people that the plans were secure even though its portfolio was enduring huge losses. Such misstatements are a breach of fiduciary duty under ERISA laws. Rather than acting in the best interests of investors, AIG fiduciaries are accused of acting in their own best interests.
The class action lawsuit has numerous organizations vying to become lead plaintiff, including the State of Michigan Retirement Systems, The Jacksonville Police and Fire Pension Fund and the Ontario Teachers Pension Plan Board all want to become lead plaintiff in the case.
Meanwhile, former AIG executive Hank Greenberg is reportedly in settlement talks with New York Attorney General Andrew Cuomo regarding charges that Greenberg altered corporate books to show improved profits. Greenberg may also face formal charges fro the Securities and Exchange Commission in the matter.
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If you are a participant in or beneficiary of AIG's Savings Plan, you may be eligible to join a lawsuit against the company to recover lost investments. Contact a lawyer to discuss your legal options.
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