Stephen Foley: The end of a petty quest for revenge

US Outlook: The fact that Hank Greenberg is getting back a Persian rug and some photos of him meeting Chinese leaders, as part of his ceasefire with AIG, tells you all you need to know about the insurance industry's most pathetic feud.

Their legal settlement stipulates that AIG must no longer be "disparaging" of its former chief executive. So allow me.

The pettiness with which Mr Greenberg has pursued revenge on the insurer that ousted him in 2005 has irreparably tarnished his reputation. It was galling enough to watch AIG having to take him so seriously in the years before its collapse; since the insurer was nationalised in last year's financial panic, his continued haunting of the company has been beyond the pale. Infuriatingly, AIG is going to pick up Mr Greenberg's $150m legal bill, using money which by rights should be diverted to the US taxpayer, to which AIG is in hock to the tune of $180bn.

At 84, Mr Greenberg is super-humanly fit and as competitive as ever. He plays tennis, lifts weights and speaks in military metaphors, as befits someone whose own service included taking part in the D-Day landings. He ran AIG as a dictatorship. Such aggression can take you so far – very far, he proves – but it can also unhinge you.

There's no quibbling with Mr Greenberg's mammoth achievement in 45 years, turning AIG from an unknown Asia-focused insurer into the largest on the planet. I understand, too, why some people feel he was hard done by when, at the height of Eliot Spitzer's campaign against Wall Street, he was forced out amid a $2bn accounting scandal for which he was ultimately never charged with criminal wrongdoing. He did pay $15m this year to settle the remaining minor civil case with the Securities and Exchange Commission, though, and did so with his usual bad grace, arguing most of the accounting restatements had been unnecessary.

Mr Greenberg's campaign of revenge against the board that voted to oust him, his public rubbishing of his successor, Martin Sullivan (who he anointed), and his legal campaign for compensation were unbecoming of the insurance industry's elder statesman.

The two sides fought over the ownership of boardroom trinkets, such as the rug and artworks. He sued when the share price went down, claiming management misled him. There were tit-for-tat suits over the ownership of $4.3bn in AIG shares. To call him a "distraction" isn't the half of it.

While AIG's credit derivatives insurance business was spinning out of control, managers had to spend time and money dealing with Mr Greenberg's interventions. He repeatedly signalled to journalists that he would launch a shareholder vote to take back control of the company, but never did. Ludicrously, at the height of last year's panic, when AIG was already done for and negotiating its government bailout, he emailed the company to suggest he buy it.

Mr Greenberg has behaved since last year as if the collapse of AIG is vindication for him, proving he shouldn't have been let go. I can't count the times that I have heard investors, analysts and writers assert that the firm would be a picture of health today under his continued leadership and before Congress this spring, he claimed he would never have allowed the financial products group to swell to such a size.

There's no way to know, of course, but I am sceptical. In three years of whingeing about the management of AIG after his ouster, I can't find any sign of Mr Greenberg having raised that particular alarm. He never hedged any of those toxic credit default swap positions when he was at the helm, what's to make us think he would have started? When in the spring he was warning of a "crisis" at the company, he spent as much time talking about the management of the general insurance businesses he knows best.

No doubt this week's settlement has been possible because Bob Benmosche, AIG's latest chief executive and an aggressive character in the Greenberg mould, has been better at massaging the billionaire's enormous ego. It is undoubtedly the right thing to have done, but it leaves a horrible taste in the mouth all the same.

Start your day with The Independent, sign up for daily news emails
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Syria civil war: Meet the military commander who says his soldiers will not rest until every inch of their war torn country is free of Islamist 'terrorists'

‘We won’t stop until Syria is back to normal’

Near the front lines with Islamist-controlled towns where Assad’s troops were besieged just last month, Robert Fisk meets a commander confidently preparing his soldiers for battle
Fifa corruption: Strip Qatar of the World Cup? Not likely

Strip Qatar of the World Cup? Not likely

But if a real smoking gun is found, that might change things, says Tom Peck
Twenty two years later Jurassic Park series faces questions over accuracy of the fictional dinosaurs in it

Tyrannosaurus wrecked?

Twenty two years on, Jurassic Park faces questions over accuracy
The inside story of how Bill Clinton built a $2bn global foundation may undermine Hillary's chances

The inside story of how Bill Clinton built a $2bn global foundation...

... and how it may undermine Hillary's chances in 2016
Genes greatly influence when and how many babies a woman will have, study finds

Mother’s genes play key role in decision to start a family

Study's findings suggest that human fertility is still evolving
12 best olive oils

Extra-virgin, cold-press, early-harvest, ultra-premium: 12 best olive oils

Choosing an olive oil is a surprising minefield. Save yourself the hassle with our handy guide
Rafa Benitez Real Madrid unveiling: New manager full of emotion at Bernabeu homecoming

Benitez full of emotion at Bernabeu homecoming

There were tears in the former Liverpool manager’s eyes as he was unveiled as Real Madrid coach. But the Spaniard knows he must make tough decisions if he is to succeed
England can win the Ashes – and Elvis Presley will present the urn

England can win the Ashes – and Elvis will present the urn

In their last five Test, they have lost two and drawn two and defeated an India side last summer who thought that turning up was competing, says Stephen Brenkley
Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)