For 12 years now, Maurice (“Hank”) Greenberg, the former CEO of American International Group, denied he misrepresented loss reserves when selling reinsurance to mortgage bond investors.

The credit enhancement AIG sold, called credit default swaps, helped those bonds earn triple-A ratings, and helped lower costs for issuers.

Unlike material hedges against loan-level defaults, such as credit enhancement, AIG relied on its own high ratings to lead investors, such as pension funds, that the company could handle high levels of credit defaults.

As it turns out, credit default swaps issued by AIG would be more aptly titled, “I can’t believe it’s not insurance.”

For when the short term credit markets, collateralized by long term debt, began to fail, it became painfully clear AIG couldn’t come close to covering losses.

AIG executives, in all their insurance knowledge, basically failed to insure the company itself. 

Now, after years of denying knowledge of all this, Greenberg will pay $9 million to the State of New York.

Attorney General Eric Schneiderman said, “After over a decade of delays, deflections, and denials by Mr. Greenberg, we are pleased that Mr. Greenberg has finally admitted to his role in these fraudulent transactions…”

In 2006, AIG reached a prompt settlement with the Attorney General’s Office, and paid $1.6 billion to settle the matter. Mr. Greenberg and Mr. Smith, however, refused to settle or to acknowledge any personal responsibility for the transactions.

However, the AG persisted. Now Greenberg and accomplice Howard Smith, AIG’s former chief financial officer, will return performance bonuses earned from 2000 to 2004.

That’s where the $9 million comes in. Typical.

“Today's agreement settles the indisputable fact that Mr. Greenberg has denied for twelve years: that Mr. Greenberg orchestrated two transactions that fundamentally misrepresented AIG's finances,” Schneiderman said.

Those two sham deals, known as the GenRe and Capco transactions, represent only a fraction of AIG’s business during that time.

"From 2005 until 2016, Mr. Greenberg and Mr. Smith delayed a trial of the State’s claims against them by engaging in extensive motion practice and eight pre-trial appeals. They maintained for over a decade that the Attorney General’s office lacked the legal authority to pursue the claims against them, and that there was insufficient evidence of their involvement in the reinsurance transactions to even warrant a trial."

At the height of its empire, AIG stretched from New York, to London, to Hong Kong, employing tens of thousands. When the US government bailed it out, it took $180 billion to do so, the largest bailout in this nation’s history.

Even then, after a decade of all this and repeated misrepresentations, the former AIG CEO finally admits to two terrible things he did, but only after tying up even more taxpayer money with the courts chasing redress for 10+ years.

Something tells me — actually $180 billion tells me — these two transactions only scratch the surface.

And that $9 million? That’s only chump change to Greenberg.

But at least it’s something.