AIG's Assets: Is Hank Greenberg the Shining 'Starr'?

(MoneyWatch)  Today's New York Times story piled outrage on outrage. American International Group was already paying taxpayer-funded bonuses to the rogue executives who put the insurer into a trillion-dollar hole. Now AIG was suing the Internal Revenue Service for $306 million, which would be funneled through off-shore corporations to pay other executives.

A closer look at the suit, however, puts some interesting names in the mix, specifically "C.V. Starr & Co., a closely held concern controlled by Maurice R. (Hank) Greenberg, AIG's former longtime chairman, and the Starr International Company, a privately held enterprise incorporated in Panama."

As reported by BNET Financial, C.V. Starr and Starr International were set up by Greenberg back in the glory days of AIG to pay millions of dollars worth of private stock to company executives, according to lawsuits by AIG against Starr.

While Greenberg was forced out of AIG in 2005 under a cloud, he retains control of both companies as chairman and chief executive, according to published reports. He also remains AIG's largest individual shareholder.

Now, in a bizarre twist, it appears that AIG wants to get money back from the government so that it can reward Greenberg's Starr empire, the very companies it is currently suing.

But why shouldn't this situation work in reverse? C.V. Starr and Starr International are both deep-pockets companies. AIG charged in its 2005 lawsuit that Starr International was worth about $18 billion. And C.V. Starr says proudly on its website that it does $1.6 billion of insurance business annually.

Does New York Attorney General Andrew Cuomo have the guts to go after the companies that took so much out of AIG, and are apparently still trying to take it? Certainly his predecessor Eliot Spitzer did. Spitzer pursued Greenberg with a vengeance and his complaints got Greenberg fired as CEO. Spitzer also charged Greenberg in civil court with misleading investors about AIG's finances by using sham contracts to hide losses.

And Spitzer went after Greenberg's leadership of Starr International, claiming that Greenberg and others had milked Starr's charitable foundation, selling its assets to two companies owned by Greenberg, who then turned around and sold those same assets to AIG at far higher prices. The Starr Foundation denied the charges.

Perhaps it's time to see just how much money Starr has tucked away in Panama. After all, it is supposed to run a charitable foundation. Who needs more charity right now than the American taxpayer?