Zeev's Turnips Patch-No Politics (ZEEV)

[marketmaven]

AIG Imploding- S&P Downgrades & New Fraud Uncovered

Starr Int Company under Scrutiny
by: us_dept_of_justice 03/24/05 03:43 pm
Msg: 24122 of 24130

""DEFIES COMMON SENSE." "One item that Sullivan should place high on his agenda: breaking down two little-known Byzantine private entities, Starr International and C.V. Starr & Co. These companies, which hold shares in AIG, seem to do little more than grossly enrich senior executives while making it tougher to figure out the firm's true cash flows.

Starr International, in which Greenberg still holds a directorship, is much like a private partnership used to compensate senior managers. Getting a stake equates with winning entrance to an elite club. C.V. Starr & Co. is essentially a broker that does business with AIG. Several of its board members are also senior AIG executives, including Greenberg and Sullivan. Both entities stay largely immune from public scrutiny but have drawn the ire of shareholders and regulators alike.

"This just defies common sense," says North Carolina State Treasurer Richard H. Moore, who recently urged the SEC to investigate AIG's relationship with C.V. Starr. The arrangement encourages self-dealing, according to investors who are currently suing AIG. Other critics argue that the opaque nature of its transactions with AIG could help the public company smooth out earnings. In any case, notes Moore, such entities "destroy, or taint, [AIG's] reputation, whether it's deserved or not."

The STARR INTERNATIONAL COMPANY INC. which 310,952,220 shares of stock with is broker through Morgan Stanley. It is the BONUS FUND of AIG officers. Their piggie bank. It's AIG's largest shareholder with a stake of over 10% of the shares. I wonder if things are PRISTINE there

AIG Inc.-Related Synthetic Ratings Placed On Watch Negative

Primary Credit Analyst(s):
Bradley Browne, New York (1) 212-438-7316;
[e-mail]
Secondary Credit Analyst(s):
Mary Ryan, New York (1) 212-438-2090;
[e-mail]
Publication date: 21-Mar-05, 15:41:52 EST
Reprinted from RatingsDirect











NEW YORK (Standard & Poor's) March 21, 2005--Standard & Poor's Ratings
Services today placed its ratings on the corporate bond-backed certificates
issued by Corporate Backed Trust Certificates AIG Debenture-Backed Series
2002-10 Trust, Corporate Backed Trust Certificates American General
Institutional Capital A Capital Securities Series 2002-17, CorTs Trust for
SunAmerica Debentures, Repackaged American General Floating Rate Trust
Certificates Series 2003-1, and Structured Asset Trust Repackaging (SATURNs)
Trust No. 2002-11 on CreditWatch with negative implications (see list).
The CreditWatch placements reflect the placement of the ratings on the
underlying securities, the $34,346,000 5.60% debentures issued by American
International Group Inc. (AIG) due July 31, 2097, the $73,991,000 7.57%
debentures issued by American General Institutional Capital A and guaranteed
by AIG due Dec. 1, 2045, the $95,682,000 5.60% Debentures issued by AIG due
July 31, 2097, the American General Corp. 7.5% notes due July 15, 2025, and
the $39,332,000 7.57% debentures issued by American General Institutional
Capital A and guaranteed by AIG due Dec. 1, 2045, on CreditWatch with negative
implications.
The $25,000,000 Corporate Backed Trust Certificates AIG Debenture-Backed
Series 2002-10 Trust issue is a swap-independent synthetic transaction that is
weak-linked to the underlying collateral, the $34,346,000 5.60% debentures
issued by AIG. The $148,000,000 Corporate Backed Trust Certificates American
General Institutional Capital A Capital Securities Series 2002-17 issue is a
swap-independent synthetic transaction that is weak-linked to the underlying
collateral, the $73,991,000 7.57% debentures issued by American General
Institutional Capital A and guaranteed by AIG. The $72,000,000 CorTs Trust for
SunAmerica Debentures is a swap-independent synthetic transaction that is
weak-linked to the underlying collateral, the $95,682,000 5.60% debentures
issued by AIG. The $15,000,000 Repackaged American General Floating Rate Trust
Certificates Series 2003-1 issue is a swap-independent synthetic security that
is weak-linked to the credit quality of the underlying collateral securities,
American General Corp.'s 7.5% notes. The $78,000,000 Structured Asset Trust
Repackaging (SATURNs) Trust No. 2002-11 issue is a swap-independent synthetic
security that is weak-linked to the credit quality of the underlying
collateral securities, the $39,332,000 7.57% debentures issued by American
General Institutional Capital A and guaranteed by AIG.
A copy of the AIG-related research update, dated March 15, 2005, can be
found on RatingsDirect, Standard & Poor's Web-based credit analysis system, at
www.ratingsdirect.com.

RATINGS PLACED ON WATCH NEGATIVE

Corporate Backed Trust Certificates AIG Debenture-Backed Series 2002-10 Trust
$25,000,000 million corporate backed trust certificates

Rating
Class To From
A-1 AAA/Watch Neg AAA
A-2 AAA/Watch Neg AAA

Corporate Backed Trust Certificates American General Institutional Capital A
Capital Securities Series 2002-17
$148,000,000 million corporate backed trust certificates

Rating
Class To From
A-1 AA/Watch Neg AA
A-2 AA/Watch Neg AA

CorTs Trust for SunAmerica Debentures
$72,000,000 million corporate backed trust certificates

Rating
Class To From
A AAA/Watch Neg AAA

Repackaged American General Floating Rate Trust Certificates Series 2003-1
$15,000,000 million floating rate trust certificates

Rating
Class To From
Certs. AAA/Watch Neg AAA

Structured Asset Trust Repackaging (SATURNs) Trust No. 2002-11
$78,000,000 million corporate backed trust certificates

Rating
Class To From
A AA/Watch Neg AA
B AA/Watch Neg AA