The Federal Reserve Bank of New York’s legal advisers sought to devise ways to avoid accountability to shareholders in the 2008 bailout of American International Group Inc. (AIG), according to evidence introduced at the end of trial testimony over terms of the rescue, Bloomberg News reported today. “We succeeded in finding a structure that allows the trust to gain control of the company without shareholder votes,” John Brandow, an outside lawyer for the Federal Reserve Bank of New York, wrote in one of the documents summarized in the trial of Starr International Co. and ex-AIG chairman Maurice Greenberg’s lawsuit against the U.S. government. In another document, an unidentified federal official expressed concern that the New York Fed’s outside counsel, Davis Polk & Wardwell LLP, is “revising history and giving self-interested advice” regarding a shareholder suit against the bailout filed in Delaware in late 2008. The documents were among more than 30,000 previously off-limits records linked to communications between the New York Fed and outside lawyers that U.S. Court of Federal Claims Judge Thomas Wheeler ordered the government to turn over to Starr.
