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Cuomo Subpoenaes AIG and Other Insurers in Fraud Investigation Re Death Benefit Retention by Life Insurers


Posted on 20 Aug 2010

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American International Group, Inc. (AIG) and four other major insurers are the latest to be subpoenaed by New York Attorney General Andrew Cuomo in a growing investigation about whether their practices of establishing retained asset accounts instead of making lump-sum death benefit payouts to members of fallen troops constitutes fraud.

According to Cuomo spokesman Richard Bamberger, AIG, Aetna Inc., CNO Financial Group, Lincoln National Corp and Principal Financial Group Inc. find themselves among 13 insurers thus far that Cuomo has subpoenaed in effort to determine whether the insurers have been making millions by putting the lump sum death benefits into potentially risky retained asset accounts that they control, while paying the deceased troopsā€™ beneficiaries a single-digit interest rate.

Other organizations are also taking a closer look at retained asset accounts, including the U.S. Department of Veterans Affairs, the Federal Deposit Insurance Corp and the National Association of Insurance Commissioners.

The other insurance companies subpoenaed by Cuomo are: Genworth Financial Inc, Guardian Life of America, MetLife Inc, AXA SA's MONY Life Insurance Co, New York Life Insurance Co, Northwestern Mutual Life Insurance Co, Prudential Financial Inc and Unum Group.


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