Tuesday, February 9, 2010

AIG is still in the business of Deny, Deny, Deny

Unless of course, they're paying out billions and billions and billions to Goldman Sachs. Then they just bend over because its the taxpayer's money!

Trudy Barnes, a 31-year-old mother of three, suffered from curvature of the spine and sought to have it corrected in February 2007 at a suburban Dallas hospital. During the surgery an anesthesiologist inserted a catheter too far into her chest, puncturing a vein and causing heavy bleeding. She went into cardiac arrest and died two days later.

Trudy had $149,000 worth of life insurance through an employee plan at defense contractor L-3 Communications, where her husband, Clint, worked. The insurer was American International Group. After Trudy died, Clint submitted a claim for accidental death benefits.

AIG denied the claim, saying Trudy had had an uncommonly bad reaction to a known complication of surgery. "This is an accident-only policy and does not cover sickness or disease," a letter from the company stated.

In his Feb. 4 ruling in favor of Barnes, Judge Chin stressed that Trudy's death was not caused by her back problems. "[The misplacement of the catheter] was not supposed to happen," Chin wrote. "Rather it was an unintentional, unexpected, unusual and unforeseen event--an accident. AIG's determination to the contrary must be set aside as arbitrary and capricious."

And now we see Goldman Sachs, is gaming the CDS game on Greece, just like they did to AIG.

If Greek banks, as the rumors goes, indeed sold Greek protection, and, as the rumor also goes, Goldman was the bulk buyer, either in prop or flow capacity, it is precisely Goldman, just like in the AIG case, that can now dictate what the collateral margin that Greek counterparties, and by extension the very nation of Greece, have to post on billions of dollars of Greek insurance.

1 comment:

Anonymous said...

How ominous that Palmoni is now quoting ZH to explain market conditions ...

This can't be good.