SACRAMENTO (CBS SF) - Insurance Commissioner Dave Jones has announced that American International Group, Inc. (AIG) will pay California $15.6 million in penalties to settle allegations that its insurance companies under-reported workers' compensation premiums over several decades - part of a nationwide settlement for under-reporting the taxable income.
The settlement covers a 25-year period of AIG reportedly "low balling" its income - complaints about this practice came from all 50 states.
KCBS' Barbara Taylor Reports:
AIG did not acknowledge guilt as part of the settlement, but Jones maintained the company did engage in intentional wrongdoing.
"We believe that this wasn't accidental behavior and I think the proof is in the pudding," he said.
California received the largest share of the nationwide settlement that totaled more than $146 million.
"And that money will go to the state's general fund at a time when the state continues to face very difficult challenges in terms of its deficit," said Jones.
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