Spitzer Drops Some Charges Vs. AIG CEO

New York Attorney General Eliot Spitzer has dropped two of six civil charges against former American International Group Inc. CEO Maurice "Hank" Greenberg, a top Spitzer attorney confirmed Wednesday.

Greenberg's legal team said that "the most explosive and financially significant claims" had been dropped.

Spitzer said he will still pursue what he considers to be the most serious accusations against Greenberg involving deceptive accounting claims. He will drop charges that became moot after AIG settled a case brought by Spitzer against the company, paid some restitution and adopted accounting reforms.

"The heart of the case remains," said David Brown, chief of Spitzer's Investment Protection Bureau.

The two dropped charges involve a scheme that Spitzer said tried to make investment income look like underwriting income, strengthening AIG's financial picture. The other claim alleged that Greenberg and former AIG chief financial officer Howard Smith were part of a scheme to hide workers' compensation payments.

The remaining charges involve what Spitzer said was a plot to "mislead the investing public about the profitability of AIG and its skill at underwriting," Brown said.