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 FINANCIAL CRISIS INQUIRY COMMISSION REPORT

Geithner told the Commission that he and others in leadership positions could
have done more to prevent the crisis, testifying, “I do not believe we were powerless.” 

AIG: “I’M NOT GETTING PAID ENOUGH
TO STAND ON THESE TRACKS”
Unlike their peers at Citigroup, some senior executives at AIG’s Financial Products
subsidiary had figured out that the company was taking on too much risk. Nonethe-
less, they did not do enough about it. Doubts about all the credit default swaps that
they were originating emerged in  among AIG Financial Products executives,
including Andrew Forster and Gene Park. Park told the FCIC that he witnessed
Financial Products CEO Joseph Cassano berating a salesman over the large volume
of credit default swaps being written by AIG Financial Products, suggesting there was
already some high-level uneasiness with these deals. Told by a consultant, Gary Gor-
ton, that the “multisector” CDOs on which AIG was selling credit default swaps con-
sisted mainly of mortgage-backed securities with less than  subprime and Alt-A
mortgages, Park asked Adam Budnick, another AIG employee, for verification. Bud-
nick double checked and returned to say, according to Park, “‘I can’t believe it. You
know, it’s like  or .’” Reviewing the portfolio—and thinking about a friend who
had received  financing for his new home after losing his job—Park said, “This
is horrendous business. We should get out of it.” 
In July , Park’s colleague Andrew Forster sent an email both to Alan Frost,
the AIG salesman primarily responsible for the company’s booming credit default
swap business, and to Gorton, who had engineered the formula to determine how
much risk AIG was taking on each CDS it wrote. “We are taking on a huge amount of
sub prime mortgage exposure here,” Forster wrote. “Everyone we have talked to says
they are worried about deals with huge amounts [of high-risk mortgage] exposure
yet I regularly see deals with  [high-risk mortgage] concentrations currently. Are
these really the same risk as other deals?” 
Park and others studied the issue for weeks, talked to bank analysts and other ex-
perts, and considered whether it made sense for AIG to continue to write protection
on the subprime and Alt-A mortgage markets. The general view of others was that
some of the underlying mortgages “were structured to fail, [but] that all the borrow-
ers would basically be bailed out as long as real estate prices went up.” 
The AIG consultant Gorton recalled a meeting that he and others from AIG had
with one Bear Stearns analyst. The analyst was so optimistic about the housing mar-
ket that they thought he was “out of his mind” and “must be on drugs or some-

thing.” Speaking of a potential decline in the housing market, Park related to the
FCIC the risks as he and some of his colleagues saw them, saying, “We weren’t getting
paid enough money to take that risk. . . . I’m not going to opine on whether there’s a
train on its way. I just know that I’m not getting paid enough to stand on these
tracks.” 
By February , Park and others persuaded Cassano and Frost to stop writing