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Justice Investigates AIG Unit

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NU Online News Service, Sept. 30, 2004, 4:22 p.m. EDT

American International Group Inc., New York, says the U.S. Justice Department is investigating one of its financial risk management units.[@@]

The department has sent a notice to AIG reporting that the AIG Financial Products Corp. is the target of an investigation involving questions about compliance with federal securities laws, AIG says.

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“AIG believes that this notification relates to substantially the same matter described in its announcement last week that the Securities and Exchange Commission staff is considering recommending that the commission bring a civil action alleging violations of the federal securities laws,” AIG says in a statement. “AIG believes that any action by either the SEC or Justice Department would be unwarranted.”

Although AIG believes an investigation would be unwarranted, “AIG intends to cooperate with this investigation,” the company says.

Securities regulators have accused AIG Financial Products of selling arrangements that helped PNC Financial Corp., Pittsburgh, get volatile and underperforming investments off its financial statements.