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Joseph J. "Joe" Cassano (age 53 in 2008) is an Americanmarker insurance executive who was an officer at AIG Financial Products from the division's founding in 1987 until his resignation in February 2008. Cassano is considered a key figure in the Global financial crisis of 2008–2009. Political writer Matt Taibbi nicknamed him "Patient Zero" of the global economic meltdown."

Life and career

Cassano grew up in Brooklyn, New Yorkmarker, where his father was a policeman. He earned a political science degree from Brooklyn Collegemarker in 1977. He worked at investment bank Drexel Burnham Lambert during their junk bond phase.

In 1987, AIG hired Cassano as one of the first ten people in the Financial Products unit, as Chief Financial Officer. In 1994, Thomas R. Savage appointed Cassano as head of the Transaction Development Group. Cassano accepted the 1998 proposal by J.P. Morgan to package credit-default swaps on Broad Index Secured Trust Offering (nicknamed Bistros). Cassano considered these collateralized debt obligations a key event: "It was a watershed event in 1998 when J.P. Morgan came to us, who were somebody we worked with a great deal, and asked us to participate."

Before he was forced to retire in March 2008, Cassano received $315 million: $280 million in cash and an additional $34 million in bonuses. An initial $1 million-a-month consulting fee was later canceled. According to Matt Taibbi:
In fact, Cassano remained on the payroll and kept collecting his monthly million through the end of September 2008, even after taxpayers had been forced to hand AIG $85 billion to patch up his mistakes.
When asked in October why the company still retained Cassano at his $1 million-a-month rate despite his role in AIG's losses on credit default swaps, CEO Martin Sullivan told Congress with a straight face that AIG wanted to "retain the 20-year knowledge that Mr. Cassano had."
(Cassano, who is apparently hiding out in his lavish town house near Harrodsmarker in Londonmarker, could not be reached for comment.)
In the wake of the scandal, United States regulators and the United Kingdom Serious Fraud Office began investigating Cassano's dealings to determine whether they were just excessive and risky, or criminal.

Cassano was a political contributor to the campaigns of Chris Dodd, Barack Obama and the Republican Representative Nancy L. Johnson

In March 2009 Cassano was linked to e-mails he authored in 2006 which solicited contributions from AIG executives for Dodd's campaign due to Dodd's position as incoming chairman of the Senate Banking Committee.

References

  1. Morgenson, Gretchen (September 27, 2008) Behind Insurer’s Crisis, Blind Eye to a Web of Risk. New York Times
  2. Prynn, Jonathan (12 March 2009). Named: The man who broke the banks. Evening Standard
  3. Lewis, Michael (August 2009) The Man Who Crashed the World Vanity Fair
  4. Taibbi, Matt. The Big Takeover, Rolling Stone, Mar 19, 2009
  5. Voreacos, David and Elliot Blair Smith (November 26, 2008). Statements on AIG Probed by Prosecutors, People Say. Bloomberg
  6. Dennis, Brady and Robert O’Harrow Jr. (January 5, 2009). 1998–2005: AIG & the anatomy of the crash. The Washington Post
  7. Cassano retirement agreement via House Committee on Oversight and Government Reform
  8. Daly, Michael (March 17th 2009). Pin AIG woes on Brooklyn boy: Joseph Cassano walked away with $315 million while company staggered.
  9. http://www.midasletter.com/news/09032301_AIG-and-the-Long-Con.php
  10. Palmer, Elizabeth (March 19, 2009). AIG Credit Swapper Under Investigation. CBS News
  11. [1]
  12. [2]


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