Former American International Group Chairman Maurice Greenberg has asked the current chairman Edward Liddy where a new, multisector, credit default swap financial venture got $35 billion in cash collateral.

Mr. Greenberg, who left AIG, in 2005 when the company was investigated for accounting fraud, is now the chairman of C.V. Starr & Company Inc., New York, included that question in a letter sent to Mr. Liddy yesterday.

Mr. Greenberg and associates filed a copy of the letter with the U.S. Securities and Exchange Commission.

AIG announced the creation of a $70 billion multisector CDS purchase financial entity Nov. 10, at the same time that it announced other efforts to work with the Federal Reserve Bank of New York and the U.S. Treasury to restructure the emergency financing the government is supplying to help support AIG.

"Dear Ed," Mr. Greenberg and associates write in the letter. "We have reviewed the restructured government funding for AIG... Set forth below are some questions related to this announcement. Please respond to these questions as soon as possible. Investors in AIG securities need to know the answers to these questions and U.S. taxpayers should know how their tax dollars have been used."

In addition to asking where the parties got the $35 billion in cash collateral mentioned in a description of the CDS purchase entity deal, Greenberg and associates ask:

o What else was paid to those CDS counterparties?

o Who are those counterparties?

o How much of the $38 billion New York Fed lending facility has been drawn?

o How much of the drawn amount has been paid over to securities lending counterparties?

o Has that amount been paid to counterparties or has the cash been posted as collateral for the benefit of those counterparties?

o How much remaining exposure does AIG have in the securities lending business above the amount drawn on the New York Fed lending facility?

"Thank you in advance for providing answers to these critical yet simple questions," Greenberg and associates conclude in their letter.

AIG spokesman Joe Norton, when asked about Mr. Greenberg's letter responded, "We're very pleased with the new agreements that we announced in November with the Fed and the Treasury."

He said, "The new agreements give us new equity capital, substantially reduced debt, extended terms and lower interest rates and fees. We're open to all proposals that are in the best interests of AIG's shareholders."

This article updated, Dec.4, 9:23 a.m.

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Greenberg Asks Liddy: Where Did That Money Come From?

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