HARTFORD, CONN.--An executive with American International Group Inc. told a federal jury today that he never saw the data needed to evaluate a reinsurance transaction that prosecutors say inflated AIG loss reserves by $500 million.

Jay Morrow was chief actuary, based in New York, in 2000 when the deal between General Reinsurance Corp and AIG took place. He is now senior vice president of the foreign general operations unit, responsible for writing all property-casualty insurance outside North America.

Questioned by U.S. Assistant Attorney Raymond Patricco, Mr. Morrow said in a calm, matter-of-fact tone that when he met with defendant and former AIG reinsurance chief Christian Milton to go over specifics of the transaction, "I had a number of questions about the deal."

Mr. Milton, of Winnewood, Pa., formerly AIG's vice president of reinsurance, is on trial with four other executives. His codefendants are:

o Former Gen Re Chief Executive Officer Ronald E. Ferguson of Fairfield, Conn.

o Elizabeth Monrad, of New Canaan, Conn., former Gen Re chief financial officer.

o Robert Graham, of Westport, Conn., former Gen Re senior vice president and assistant general counsel.

o Christopher Garand, of Upper Saddle River, N.J., formerly a Gen Re senior vice president and chief underwriter for U.S. Gen Re's finite reinsurance operations as well as a director of Cologne Re Dublin, a Gen Re entity.

The group are accused in a 16-count indictment of violating federal securities law, securities fraud, mail fraud, and making false statements to the Securities and Exchange Commission.

According to the government, the phony finite reinsurance transaction was a maneuver to better AIG's financial picture and improve the stock's standing with analysts and investors. The full particulars were kept hush-hush with a secret side agreement between the companies, it is alleged.

In an e-mail to Mr. Morrow sent to Mr. Milton that is part of the government's evidence, the actuary bullet-pointed several of his concerns. Among them was that there was no data to properly evaluate the deal and that the request was marked as confidential.

Mr. Morrow testified he had "never seen a confidentiality request like this before."

He also said that when he told Mr. Milton that he needed underwriting data to review the proposed transaction, the reinsurance executive "indicated he did not have the data." Without that data, Mr. Morrow said he could not properly evaluate "the risk of the deal." But when he confronted Mr. Milton, the former AIG chief told Mr. Morrow he "was not able to keep the data."

Mr. Milton, said Mr. Morrow, "indicated we would get to see the data, but I never saw it."

"There was no data at all, and without data there is no way for me to analyze it," Mr. Morrow told jurors. He said he'd never seen a deal of that size without getting loss reserve information.

Mr. Morrow is the fourth prosecution witness to testify from a list that has 100 names on it. The trial is expected to take up to two months.

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