NU Online News Service, April 28, 3:17 p.m. EDT

American International Group Inc. has sued two financial firms alleging that they engaged in fraud and unjust enrichment by issuing exotic securities they claimed were backed by prime mortgage-backed securities.

The suit says that AIG suffered losses because the securities were either insured through its financial products subsidiary or purchased directly by its securities lending unit.

The suits are the first of an expected wave of suits AIG will file to recoup money paid to reimburse banks for their investment in securities tied to mortgages that AIG Financial Products insured through credit default swaps, and tied to $40 billion in mortgage-backed securities purchased directly by a separate securities lending unit.

AIG is limited in whom it can sue through an agreement with, among others, the Federal Reserve Bank of New York.

The NY Fed said last year that a broad legal release was part of agreements in late 2008 that cancelled credit-derivative contracts between AIG and various banks.

But the agreement did not require that AIG hold harmless the managers who assembled the securities AIG insured, according to several people.

The suit was filed in New York State court against ICP Capital Management and Moore Capital.

In a statement, AIG says that AIG CEO Bob Benmosche disclosed at last year’s annual meeting that the company was reviewing its dealings with all of the counterparties with which we did business before and during the financial crisis to see if they harmed us by their conduct.

“This suit is the first result of that review,” says spokesman Mark Herr. “ICP’s fraud harmed AIG and the American taxpayer and we are fighting back,” Herr adds.

The first suit involves collateralized debt obligations (CDO) backed by residential mortgage-backed securities. The total value of the two CDOs insured by AIGFP was $7.7 billion. They were issued in September and December 2006.

The suit claims that ICP committed fraud and Moore Capital “unjustly enriched” itself by entering into deals “either directly or indirectly,” with the two CDOS “for the sale of residential mortgage-backed securities that were inflated above prevailing market prices.”

Margaret Keely, a lawyer in Washington for ICP at Williams & Connolly, did not return phone calls seeking comment.

Officials at Moore Capital, based in New York, did not respond to requests for comment.