AIG Beats the Rap

With all the fuss on BP and the Fed sting on small-fry mortgage loan sharks, the SEC quietly dropped its probe on AIG's Joseph Cassano.

Not so long ago, although it seems like a decade ago, AIG was bailed out by the US government. The cost? $128 billion. The principal reason for AIG's dramatic fall from financial grace was its profound involvement in highly leveraged, mortgage-backed financial instruments that weren't worth a damn. The architect of this fiscal catastrophe was Joseph Cassano.

At the time of AIG's collapse, Cassano was based in London and, consequently, difficult to bring to effective prosecution. I understand Cassano and his team were among those paid handsome "retention bonuses".

The looting of American household wealth has largely gone unprosecuted and unpunished. I think that's a crime.