Greenberg Says Bernanke Testimony Key in AIG Bailout Suit

U.S. Federal Reserve Chairman Ben Bernanke should be required to testify in Maurice “Hank” Greenberg’s lawsuit over the bailout of American International Group Inc. (AIG), Greenberg’s lawyers said.

Bernanke made key decisions about the government takeover of the insurer during the financial crisis, according to a filing by Greenberg’s Starr International Co. today in the U.S. Court of Federal Claims in Washington.

Starr sued the U.S. for $25 billion in 2011. Greenberg called the assumption of 80 percent of AIG’s stock by the Federal Reserve Bank of New York in September 2008 a taking of property in violation of shareholders’ constitutional rights to due process and equal protection of the law. Starr today urged Judge Thomas Wheeler to deny a government request to quash a deposition subpoena of Bernanke.

“No other witness can serve as a substitute for Mr. Bernanke’s testimony,” according the filing. By Bernanke’s own admission, “the decision to take over AIG was his.”

The case is Starr International Co. v. U.S., 11-cv-00779, U.S. Court of Federal Claims (Washington).

To contact the reporter on this story: Andrew Zajac in Washington at azajac@bloomberg.net

To contact the editor responsible for this story: Andrew Dunn at adunn8@bloomberg.net

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