Verret Testifies on Hill Re: Flaws in AIG Trust Agreement
Professor J.W. Verret appeared as a witness at a May 13 Capitol Hill hearing of the House Committee on Oversight and Government Reform to express concerns regarding the AIG Trust Agreement.
In his remarks, Verret voiced his belief that the trust document set up by the New York Federal Reserve Bank to manage the government's investment in IAG provides significant risk to the American taxpayers' $125 billion investment in AIG and sets dangerous precedent if used as a model for future trusts.
Chief among Verret's concerns are provisions requiring trustees to manage the trust in the best interest of the Treasury Department, rather than the taxpayers; protections against liability for trustees; and the ability of trustees to invest personally in investment opportunities that may otherwise belong to AIG.
The hearing has been aired on C-Span.