The Auditors Are Speaking Up

Day by day the AIG situation gets more disturbing. Today's story from the Wall Street Journal is that AIG auditors - both internal and external - warned top management of potential problems with the CDS the company held. Top management either didn't believe the auditors or preferred to ignore the issue, as at an investor conference in December the CEO said, "Now at the end of the day, what is the bottom line? And, what should you take away from today's discussions? First of all, that AIG has accurately identified all areas of exposure to the U.S. residential-housing market; second, we are confident in our marks and the reasonableness of our valuation methods."