This article provides a brief overview of AIG's operations and explains why AIG suddenly collapsed. It then details the terms of the initial US government bailout and later restructurings. Finally, the article describes the regulatory gap exploited by AIG and ensuing regulatory reform.

Die Unternehmergesellschaft ist als neue Erscheinungsform der GmbH entwickelt worden, die den Bedürfnissen der Praxis entgegenkommen und vom Ansehen der GmbH profitieren soll. Der Regelungsaufwand wurde in § 5a GmbHG auf ein Minimum reduziert, ohne die bei der Gründung gestellten...

The right to health insurance is a constitutional right. The right to health insurance is included into the group of economic and social rights. The implementation of these rights is conditioned to a special law which has to establish the rules and their application procedure. Starting from...

Many believe that deliberative democracy, where individuals discuss alternatives before voting on them, should result in collectively superior outcomes because voters become better informed and decisions are justified using reason. These deliberations typically involve a moderator, however,...

The paper analyses the legal transfer of formal rules regulating stock markets in Spain between 1800 and 1936. We argue that the transfer of French legislation in the 1830s provoked a “transplant effect”, which generated serious distortions in Spanish financial markets. As a result, Spain...

During a recent study of how 1991 federal sentencing guidelines have affected the penalities that federal courts impose on public coporations, we performed an independent evaluation of the quality of the data on corporate sanctions released by the U.S. Sentencing Commission to the public (as...

In the last few years law and finance scholars have 'discovered' the usefulness of comparative law. Their studies look at the quantifiable effect that legal rules and their enforcement have on financial development in different countries. Moreover, they link their results with the long- standing...

We shed new light on the corporate governance role of institutional investors in markets where concentrated ownership and business groups are prevalent. When companies have controlling shareholders, institutional investors, as minority shareholders, can play only a limited role in corporate...

Who are mutual fund investors? The answer is critical to regulatory policy. The mutual fund industry portrays fund investors as diligent, fairly sophisticated, and guided by professional financial advisors. The SEC paints a more cautious portrait of fund investors, though touts improved...

The use of equity derivatives to conceal economic ownership of shares (“hidden ownership”) is increasingly drawing attention from the financial community, as is the exercise of voting power without corresponding economic interest (“empty voting”). Market participants and commentators...