EXHIBIT 19 

Case 2:08-cv-15147-LPZ-MKM Document 61-5 Filed 06/07/10 Page 1 of 4
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BOARD Of'" QOVERNORS

Dr tHl

,.ED£RAL RESERVE SYSTEM

..,.,ttnUJTON. G. t. £0••'

Novembor9,2OO8

2008-SE-006137

.«.N .. al:"MAHIlC

CH.t.........

lbe HOIlIJI1lblo Homy M. PauIsoa, Jr.

oftho T.-ury

~lIIItof1heT_

lSoo l'enIIsyl"";a A_, N.W.

WlllIIIlnpoa. D.C. 20220

Dcot Mr. s.a-y,

I am 'M'ilIDa ID COIIIIOClion with theEmetaacr!lcol>Dmlc StobIlfzaliOll Act or

2008 (BESA), wlllcb.lIlborIZostho SecmaIyofthe Troasuty to -"lUlltile Troubled

Asset RdleCPrllpm (TAJtl'). h expIoiDed below, I bolieYe that utiIizb>a TARP l\mds

to pun:Iloso proor....ocI equity ofAmcriooD I. '" ·''''00 GIoop, Inc. (AlO) IJ ........".to

p_fiIIoooW 1lobIIity.

,.. you ate weIlawue, ftuDclaJ matblII Inthe t1Dhed 8lIlOlI ....-. 1ipIfl 1Ilo pat ,..,Illd a quart<r. DuriIl& that lime, iIlveslor

mnfl",,",", III U.s. 6DaDoioi baa beoD IbaIr.oD severely by tbe IIIatpIIld broodbuocI blllomCpdceo; the oootiD"na rlao inIDlJl1B1llpi doIiDqueaciesllld

cIeCoulta; the resu1tiJw sub.tlaDIioJ drop ill val....or1l101f&1lpS IIlCIm~

securities; the col'-or_.... 1bocIlJla 1IIIIkets; tbe ,.,.... CI1I5ocI by the f1lll1w of

oevctal aipU~ 1iIlIIldal1iJsliJuli0lll; m11atp 1_at finonolal iDslltudo""

III otbetporlll oflba world, aJnOlli oIbet 1IIilIjp.

0Ilc ""-'that was puticulorly IffoctocI by these conditlOll!l is AlG. AIO is a

large, dlveniflad IinulciaI JCni... COIDJAdl)'!hoI reponed co,rid""" to1aI.-s or

dtghtly mote dlID St llilIiOl> ..ofJ_ 30. 2008. In 2001. A10',1nsutaDee mbridlatles

were tbe Jmaest provIden ofwe IIDd bnaltIllDswaDce ill tho Uoltad Statea aDd tho ....Dd

Iarpst prc>Yldetsofpropeny Illd c:aouaIty iDsunoDce in the lJnjlEd S1aIa in terms ofIlet

pmniumo Wli"... Besides ltadldoOOIife, bnaltIl aDd property IlIId caaualty insuroDce.

AlO's subaidiati.. also provide lJ1W1lllleod in_co_aDd procIuols that protect

participants in 401(11:) rctiremellt plans. AlO .lso Is. major participant In. wide nDP of

clerivallvesmarkelS 1hrou8hIta AIO F"Dl8IlcloJ Products _ UDlt, IIlCI is .l!Inffieaut

couote<pany to • oumber ofmojO!""Donal and iDtematioOOliJllmcial instiUlIions. As.

"""It ofAlO', I...... on various inveaImcnts IIlCI other transactions. the firm OJ<perl_

increaaocl cIifliculty raising funds in the lIllUkets.1lld clellwIt by the llrm on Ita obligallons

DEPOSITION

EXHIBIT

.II Z trrwk€/

:1# r/.(J c,'o 9 DEF00000325B

Case 2:08-cv-15147-LPZ-MKM Document 61-5 Filed 06/07/10 Page 2 of 4
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-"" Hledy. Should it have failed to.-.such oblipliDns, AlO',

roletiOIlIbIpo with JlIlm1 mo,jor<Iamcstic IIIlIiJdlonloIiODal finax:Ia1 irDtltutions had the .

poIonlial to IeIdto 1IIIDlfIoaIII ...... by thole !IIIlI1IIdoDI. ID tboso.m.,_......... disordaIy filluseofA10 coald haw odded to lIlIeody IipIIfIC8III_offiJuoDdll

morbtfloIl1Itl' IIDd led to IIIkIsDliaIIyhipbom>wiIls 00SlI, reduced hou5ebolcl wooI1lI.l1Dd mDrilIIJy__1IlIC JlOIfut_

IDUahtoftbooc lIDdolherilols, lbo Ilo&rdon 8epIembor 16, 2008. wI1h the

$upporl oftbeT.-y, auibor\Yd tbe Fedonol R.....illmkofNew York (RIlaerve

illmk) to exteDd "p to S8S bOl!DIllll c=IIt to AIO to preveat tbe disocderl.y lld1ule oflbe

collIpOll)'. 1'bla credit fIcIlIty _ cIoolanod 10 be RfIIll4 from JllOcoedo from lbe 0ld<rIy

-wiacII.o8 aDd ....of..-,. oflbe !iaa', wets, iDoludlag Ibe sole ofmoat ofiU

ouIlsIdiIry iuIuroDoecompoaleo. SU!ltequeully.1O help ....0IlI0iIIa IIquldIly __011 AlO. theBoad""October 6. 2008.1IIIIbmilred thc -.e_ to boaow

up to 97.8 bi1llou ill""_......~_from AIO ill returIl for _ coIIoler.t.

S"1IlOO die limedie Ilo&rd IIIIIlari20d the llMrveBtIIk to ex!eII4md11 Oft

SopIOIIIber 16, Co!lgIeoo boo audIoli:oed the oreolioD oftheTARP, which aI10wI the

'lieeuIytollDqUlro'iroubled .-."lDoIud"'ll\Y"fiIloDcIIl _ die

8e<n11rY, ofter eououIIaIIon wIda Ibe Chalmuou o(tho !loIn1of0.._ofdle Fedonol

a........ 8)'111Om, ddamineI thepuldwoof...t>lcb Is _ Yto plOIlIIlte l!IloDoial

morbll18b!l1ty."' .

Myolllalow, 1110T_~huahady ~iIbocl.alIIIrlbo

00IIIIIItIII0aa provWocI for iIlBBSA,. CIpIto1PmubuoPn1snm lIIIderwbleh lbe TARP,

..".efto spectliodwudlliMlio will pan:huo ,..,*01 pocfIIIed Itool<0IId-at __1..-11>7quaII.l'yIaaU.s. boukIlIIlI ...... IIIlIlheirbokIiDg

CODIJIIIliea. thatP"'snm. inCCli\imoctioo. with the FDIC',__pro...... lIIlIlhe

proyisIoa ofS\llo*!aPia! ....-o(lIquIdItyby Ibe FocIen1 ae-sppoan 10 hove

Incrased lbe ttobiUty oflbeU.s. bIlIlkIIlB fYII=.

H","",,"r, Ibe 'llUlllioo ofAlO has DOtJUlly lIlabi1i%ed, 811l1Dlbor of~or

flnaDti'l iDltitudOlllsJaballY CIOJlIiIllIo 10 hove su1>slIII1laI "'!JlOIUI'OI to thc timl,lIIlI

eDIl8IqIIeIlI1y AlOClCDlIiDues to pose r1sb. T1Ie Federal RmuvclntoDd:s to tab

<:eJl8!lI stopIlO improve the fum',liJlalImJ eonditiOllIlDd protccI_ciaI IlIbllily IIDd

the Fedcml R.eoetve """IlIxpsy.... Nonetbeles!, dlacuaaions with ofAlO

md information provldecl by tbo mdit nding qonoles DOW Inditate. ill the current Ilogil.

IJIIIloet COIldltiona, tballID injectiollofapproximately $40 billion ill "ewly iSIIled

prefoned atocIc ofAIO would provide the best proopects fut an orderly ....,lutiOll ofthe

firm wllh 1110 IeaJt 4isrupIJon to tbe fIDm.1laI lIlIrlceu """ tbe avero1l eoonamy,lIDd

would provide the J"IClCIlllll!lll1lll<Ctballbe FedmI IIDd !be lDltpayer will be

rqioid IIIll! Jl'OIected. T1Ie Federal Re.ori. i. outhoriz;ed \lllclor lhe Fedoml Resorve Act

to oxt""" CIodit in various fomJs. but is not authorized to pun:hue equity securiti..of

finADcial institution:" However, in my viow. !be pwclwc ofporpetual preferred stoek of

I §B....ionJ(9)(II)ofBESA.

DEF000003259

Case 2:08-cv-15147-LPZ-MKM Document 61-5 Filed 06/07/10 Page 3 of 4
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AlOWOllld qualify...fillaDeiai iDalnurIentfOr pusposes ofthe EESAand would be.

pctmlIalble and OPPiOjllI8le invoslmeaI fOr1hc TARP. ThO'iDvestmeIII would ausmcnt

the copilaI ofAlO. bellm ....bIe die c:empooy and;1O rogulatecIlUbsldlari<sto weather

the current_en> dillieuJtloo InfiD8DciaI mor!<bls descrlbecI &boY., and risb to

the fiDaDc:lallystem. I uudenlaod thoI AlO 10 JBlll"lRdto ialIIlo 1hc tARP pRfemd

_k1hot lncI1rdos _ desipIolloplOlc<l \be I-..sts oftaxpoyen and help 0IlBIIle

dIlIt AIO is able to t\dIy repey!be U.s~ govcmmont fOrallliquidity and copillll assistance

provlded. AIG must a1Io ebkIe by tho .........ds govemiDg ox_compemo1ion

eotablilhedby !be SecnIuyUDd«1hc I!IlSA.

As. Ie8Ult, I baY. ClOIldudacllhot 1hc purcbose ofpmomcllllod< lim AlG by the

tARP uudor1hc COJIdiliaDl ostabtisJlall by tlleT-.ry is n., FF I) 10 promote Iinllncial

...-oIIlIoItity. Treasury'. invOltmenl, aIons wi1b the olhtrIlopo proposed to be lakm

by \be FadaralRamva, ..,;",td lFImJ&lben \be OO1Ilpmy ond our tInancial_ and

bolIo:r ClIlIIbIc both tho IlOIlIpIIl1Idd \be fiIIInclall)lltomto wiIholaad the.-marbI

\1IlIllOlI tIldJiIOvib credit and otherl!nIIIldal ..........-!Ildby-.small

~ondathm.

DEF000003260

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