Former AIG Chief Maurice Greenberg Is Building Rival Insurance Company

Maurice Greenberg, the man who built the American International Group into a giant so powerful that its troubles played a key role in the 2008 financial crisis, is creating a new insurance company that is attracting some of his former firm's talent, the New York Times reported Monday. After the Treasury Department placed heavy restrictions last week on executive pay at bailed-out firms such as AIG, a number of the company's personnel may look to their former boss and his new C.V. Starr & Co. for the kind of compensation they're used to.

Greenberg has been quietly replicating the method he used at AIG, building up smaller companies that could one day challenge the now-humbled insurance giant. He was ousted in a 2005 accounting scandal and, as his fortune was in company stock, lost most of it in the market crash last year. Over the summer, he won a court case against AIG, earning the rights to $4.3 billion in stock. C.V. Starr will be privately held, meaning it has no stock and discloses no financial information, but it appears to be adhering closely to AIG's structure -- a "Rubik's cube" of specialized insurance companies.

AIG is still struggling to untangle itself and pay back taxpayers the vast sums it received from the government, something it will have even more trouble doing if its business and executives jump ship to join Greenberg's new venture. White House pay czar Kenneth Feinberg said he was aware of the trouble punitive regulation could have on AIG's ability to repay taxpayers, and worked closely with the company to set rules that they accepted as appropriate.