ALBANY, N.Y. -- New York Attorney General Eliot Spitzer yesterday said he will audit American International Group Inc. over reports that it improperly booked workers' compensation premiums, providing an ''unlawful benefit" to the company worth tens of millions of dollars.
Spitzer and the state Insurance Department are appointing a consultant to audit the company for conduct that Spitzer said appears to have happened over a decade and is now discontinued.
Spitzer said a 1992 AIG memorandum to top management reported the practice was illegal
Spitzer and acting state Insurance Superintendent Howard Mills are looking at whether AIG booked premiums for workers' compensation coverage as premiums for general liability coverage. The result could be that AIG avoided paying its share into several workers' compensation funds.
AIG has been cooperating, the attorney general's office said. To date, AIG has provided no evidence that it disclosed the practice to regulators or made restitution.
An AIG spokesman did not immediately respond to a request for comment.