#5: Greenberg Returns To Center Stage

If the insurance industry had the equivalent of baseball's "Comeback Player Of The Year" award, the winner in 2009 would no doubt be Maurice Greenberg.

While Mr. Greenberg may have left his post as CEO at American International Group following an accounting scandal in 2005, he remains the property and casualty industry's embodiment of the old E.F. Hutton ads--when he talks, everyone listens.

After taking an uncharacteristically low profile for a few years while running C.V. Starr & Company, dealing with government probes of his AIG activities and legal battles with his former company, Mr. Greenberg stepped back into the spotlight big time.

Prominent coverage of Mr. Greenberg's actions and musings began in January, when he publicly challenged AIG's sale of Hartford Steam Boiler to Munich Re. He pointed out that while he bought HSB when still in charge at AIG for $1.2 billion in 2000, his successors--under pressure to repay federal bailout loans as quickly as possible in a terrible economy--sold the carrier for what he characterized as a "distressed" price of $724 million.

The most recent headlines came in the late afternoon of Thanksgiving eve, with an announcement that AIG and Mr. Greenberg had set in motion a resolution process to settle any remaining differences between them and effectively bury the hatchet.

In between, Mr. Greenberg commanded the headlines throughout the year.

Back in April, Mr. Greenberg--still a major stockholder in AIG--appeared on Capitol Hill to tell a House committee that the federal government's bailout plan to rescue his former company was doomed to fail if predicated on dumping assets at fire sale prices during the economic downturn.

Taxpayers, he warned, would only get "pennies on the dollar for their investment in AIG." He also argued that had the government walled off AIG's Financial Product unit and simply offered guarantees to counterparties, everyone would have been better off.

He vigorously defended his running of AIG and suggested that risk management had become lax after his departure in the trading of credit default swaps.

Mr. Greenberg enjoyed a sweet victory over his former firm after what he called a "grueling" seven days on the witness stand in a court battle over whether Starr International Company--which he heads--had been obligated to hold some $4.3 billion worth of AIG stock shares in trust for retiring employees.

He also ended his long-running dispute with the Securities and Exchange Commission, paying $15 million to settle concerns about fraudulent accounting while he was at AIG. However, he then clashed with the SEC over the settlement's meaning and the seriousness of the charges, prompting a clarifying statement from Mr. Greenberg in which he acknowledged the "significance" of the situation.

Last month, Mr. Greenberg's representatives put out a statement denying an Oct. 27 New York Times article that reported his firm was "raiding people" from AIG, noting that "only 13" employees from his former company had joined C.V. Starr.

Mr. Greenberg made more headlines with a speech at the St. John's University School of Risk Management in October, in which he placed most of the blame on regulators for failing to detect the warning signs and head off the kinds of corporate behavior prompting the financial meltdown.

"We ought to appoint a blue ribbon panel of some wise people to look at what happened, whether regulators did their jobs and whether we really need more regulations or just better regulators," he said.

Finally, Mr. Greenberg and AIG announced the terms of their peace treaty in late November. Under the deal, an arbitrator will determine claims by Mr. Greenberg for legal fees and expenses, with a cap of $150 million--which perhaps showed that the only winner in their battle were the lawyers.

There were also some personal points resolved, including access to AIG documents for use in research in writing Mr. Greenberg's memoirs--which you can bet will have a different title than the one written in 2006 by a former employee, "Fallen Giant."

The settlement sparked speculation about a possible return of Mr. Greenberg to AIG in some formal capacity--even if only as an advisor. If he pulls that off in 2010, he might be the only person to ever win two straight "Comeback Player Of The Year" awards.