Fifth Exec Sentenced for Scandal

John Houldsworth has been sentenced to two years probation for his role in an accounting scandal involving insurer American International Group Inc.

The former executive was sentenced Tuesday in connection with an accounting scandal that authorities say cost shareholders of American International Group Inc. more than $500 million.

Houldsworth, former chief executive officer of Berkshire Hathaway's General Re affiliate, Cologne Re Dublin, was also fined $5,000 and ordered to perform 400 hours of community service.

Holdsworth had pleaded guilty in June 2005 to conspiring to commit securities fraud and provided key testimony against other defendants.

Prosecutors say AIG paid Stamford-based Gen Re in a secret deal to take out reinsurance policies with AIG in 2000 and 2001. They say the scheme propped up AIG's stock prices and inflated reserves by $500 million.

Houldsworth pleaded guilty in 2005.

Federal prosecutors are asking for a reduced sentence for Houldsworth, saying his extraordinary cooperation helped convict five other executives in the case.

  • Elizabeth Monrad, 54, of New Canaan, will serve 18 months in prison.
  • Ronald Ferguson, Gen Re’s chief executive officer from approximately 1987 through September 2001, was sentenced to two years in prison and ordered to pay $200,000. 
  • Christian Milton, AIG’s vice president of reinsurance, was sentenced to four years in prison and fined $200,000. 
  • Christopher Garand, Gen Re’s senior vice president and the head and chief underwriter of Gen Re’s finite reinsurance operations in the U.S., was sentenced to 12 months and one day of imprisonment and fined $150,000. 
Copyright AP - Associated Press
Contact Us