Former American International Group Chairman and CEO Maurice "Hank" Greenberg has settled with the Securities and Exchange Commission.

The SEC charges Greenberg and former Vice Chairman and CFO Howard Smith were culpable for material misstatements that enabled AIG to create the false impression that the company consistently met or exceeded key earnings and growth between 2000 and 2005.

"Corporate leaders cannot avoid the truth and consequences of their companies' performance by using improper accounting gimmicks and signing off on distorted financial reports," Robert Khuzami, Director of the SEC's Division of Enforcement said in a statement. "Greenberg and Smith oversaw various improper transactions that presented a false financial picture and allowed AIG to claim success in meeting its performance goals."

A statement published on behalf of Greenberg in the Wall Street Journal, noted the SEC had concluded not to charge Greenberg with any fraud and disputed the contention that Greenberg was a “control person” charge under Section 20(a) of the Exchange Act.

Nonetheless, to settle the SEC's charges and pay disgorgement and penalties, Greenberg will pay $15 million and Smith will pay $1.5 million. In 2006, the SEC charged AIG with securities fraud and improper accounting, paving the way for Greenberg’s ouster from the company.

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