Ex-AIG chief 'to pay up on lawsuit'

NEW YORK: Former AIG chief executive, Maurice "Hank" Greenberg, and five other defendants, have agreed to pay $115 million to settle a shareholder lawsuit, according to a person familiar with the matter.

The cost of the settlement is expected to be largely recouped through an insurance policy that covers company directors and officers against the cost of lawsuits, according to the person.

The development comes days after Greenberg and former AIG chief financial officer Howard Smith reached an agreement to settle accusations by the US Securities and Exchange Commission that they had altered AIG's financial records from 2000 to 2005 to inflate the insurer's earnings.