Queried by Assistant U.S. Attorney Raymond Patricco, Napier explained a series of discussions among the defendants ranging from accounting issues to what prosecutors contend were efforts to create a false paper trail for the deal and to disguise AIG’s payments to Gen Re.
The former executives charged with conspiracy and fraud are Ronald E. Ferguson, Gen Re’s former chief executive officer; Christopher P. Garand, former senior vp in charge of U.S. finite underwriting for Gen Re; Robert Graham, former senior vp and legal counsel; Elizabeth Monrad, former chief financial officer for the reinsurer; and Christian M. Milton, AIG’s former vp for reinsurance.
Prosecutors allege that the transaction at the heart of the case -- a two-part, $500 million loss portfolio transfer from Gen Re’s Cologne Re Dublin unit to AIG -- actually transferred no risk and was intended only to allow AIG, the world’s largest insurance company, to inflate reserve levels in 2000 and 2001 to quiet concerns among AIG stock analysts.