First few paragraphs from the WSJ, original article. I say we create a new form of punishment for executives at bailout targets who failed to act to avoid the crises: they have to work at Wal-Mart or Target for 3 years at minimum wage, stocking shelves and have to live on the wages they make. Perhaps that would teach them to think about the average person who puts trust in them.
"Top officials at American International Group Inc. knew of potential problems in valuing derivative contracts long before these risky transactions caused the insurer’s shareholders severe pain, according to documents released by congressional investigators.
The disclosures come as prospects dimmed this past week for AIG’s efforts to quickly sell assets to repay its bulging debt to the government. The derivative-contract problems would have driven AIG into bankruptcy; in the past month, the government has made available to AIG nearly $123 billion in a rescue plan.
A federal criminal probe under way since earlier this year is also looking at how candid company executives were with investors at a December 2007 investor conference and whether executives at AIG’s financial-products unit, which sold derivatives contracts, misled AIG’s outside auditor last fall."