December 22, 2005
Former Goldman head says Spitzer made threats
By Joseph A. Giannone
NEW YORK (Reuters) - Former Goldman Sachs Chairman John
Whitehead on Thursday said New York Attorney General Eliot
Spitzer threatened him during an April phone call for writing
an opinion piece critical of Spitzer and his attacks against
prominent insurance executive Maurice "Hank" Greenberg.
disputed Whitehead's version of the exchange and said
Greenberg, who resigned as chief executive of American
International Group Inc., put Whitehead up to writing the op-ed
In a second Wall Street Journal op-ed piece on Thursday
Whitehead, currently chairman of the Lower Manhattan
Development Corp., claimed Spitzer threatened him.
"Mr. Whitehead, it's now a war between us and you've fired
the first shot," Whitehead quoted Spitzer as angrily stating.
"I will be coming after you. You will pay the price. This
is only the beginning and you will pay dearly for what you have
done. You will wish you had never written that letter,"
Whitehead claimed Spitzer said.
But Spitzer spokesman Darren Dopp said, "This account is
not accurate. It is embellished and false. (Whitehead) is
simply not telling the truth." Dopp also said Greenberg asked
Whitehead to write a letter attacking the attorney general.
Whitehead could not be reached for comment. Howard Opinsky,
a spokesman for Greenberg, said Whitehead wasn't pushed into
writing the op-ed by anyone.
Whitehead's charge comes at a critical time for Spitzer, a
Democrat who has announced plans to seek election as New York
governor next fall.
WAR OF WORDS
Spitzer, who won acclaim for investigations into tainted
Wall Street research and mutual fund trading that led to
reforms, launched a sweeping investigation in 2004 that first
targeted insurance brokerage Marsh & McLennan on charges of
AIG initially was named a party to some Marsh deals by
Spitzer but quickly took center stage as the investigation
focused on questionable reinsurance transactions and accounting
moves. By April, Greenberg and AIG became Spitzer's top
"The evidence is overwhelming that these were transactions
created for the purpose of deceiving the market," Spitzer said
in a nationally televised interview. "We call that fraud. It is
deceptive. It is wrong. It is illegal."
Spitzer's office filed a civil lawsuit against AIG on May
26. A trial has not yet been scheduled as settlement talks
continue. AIG is also under investigation by the U.S.
Securities and Exchange Commission and the U.S. Justice
Amid the various probes, AIG forced Greenberg out as CEO
after four decades building the global insurance giant. The
company has cooperated with Spitzer and restated financial
Greenberg has argued AIG did nothing wrong and that the
board simply caved in to Spitzer's demands.
CRITICISM OF SPITZER
Whitehead wrote the first Wall Street Journal op-ed piece
in April entitled, "Mr. Spitzer Has Gone Too Far," criticizing
Spitzer for accusing AIG and Greenberg of fraud and wrongdoing
during the TV interview.
"Something has gone seriously awry when a state attorney
general can go on television and charge one of America's best
CEOs and most generous philanthropists with fraud before any
charges have been brought," Whitehead wrote in April.
Dopp said Spitzer confirms making the call to Whitehead
after the first op-ed piece appeared, to question some of the
claims made. Whitehead, Dopp said, also acknowledged that
Greenberg asked him to write the first op-ed piece.
Greenberg has mounted a campaign to restore his reputation,
and is reaching out to rich and politically connected friends
to help his cause. Greenberg also has joined Kenneth Langone, a
billionaire investor who is also the target of a Spitzer
lawsuit, in an effort to thwart Spitzer's political goals by
funding opponents or airing critical ads.