Former AIG CEO Robert Benmosche dies of cancer at 70
NEW YORK (AP) — Former AIG President and CEO Robert Benmosche, who led the insurer's turnaround after its $182 billion government bailout, has died of lung cancer at age 70, the company announced Friday.
The company says Benmosche died Friday morning at NYU Langone Medical Center.
Benmosche became AIG's CEO in August 2009, recruited for the job by the Obama administration. He had previously led the insurer MetLife.
American Insurance Group Inc. was bailed out at the height of the 2008 financial crisis after its near collapse when the subprime mortgage bubble burst.
Regulators were concerned that AIG's demise would send shock waves through the financial system, which was already staggering after the failure of financial services firm Lehman Brothers.
The company paid back its bailout by 2012 and the government received a profit of $22.7 billion. AIG also restructured and sold off some businesses, cutting its size in half.
A statement from Benmosche's family said he "engineered one of the most extraordinary corporate turnarounds in American financial history."
Benmosche was born May 29, 1944, in the borough of Brooklyn. According to a statement released by his family, his parents, Lillian and Daniel, later moved upstate, running a restaurant and renting out cabins. When his father died in 1954, his mother was saddled with $250,000 in debt. Benmosche later worked in his family's motel business, drove delivery trucks for Coca-Cola, and served in the U.S. Army in South Korea.
Benmosche later became CEO of MetLife and led the company when it went public in 2000. He retired in 2006 and established a vineyard near his villa in Dubrovnik, Croatia, before being asked to take over at AIG.
AIG became a symbol of excessive risk-taking on Wall Street and it was a focal point for public anger. AIG spent $440,000 on spa treatment for its executives days after it was bailed out, and it paid millions of dollars in bonuses to executives.
In early 2013, while AIG was running an ad campaign thanking public for its rescue, former CEO Maurice "Hank" Greenberg sued the government, saying the terms of the bailout were too onerous. AIG was legally obliged to consider joining the action, but decided not to.
Later the same year, Benmosche defended the bonuses and told the Wall Street Journal that public and governmental anger over AIG's bonuses was wrong and similar to a lynching.
The Benmosche family said he "spoke publicly - and in his trademark style, bluntly - about the injustice he felt was being done to his employees." It said his defense encouraged AIG staff and helped lay the groundwork for its recovery.