AIG accuses Coventry First of illegal markups on death bets
August 28, 2015 by ERIK LARSON AND PATRICIA HURTADO
(Bloomberg) — Coventry First LLC illegally marked up prices on hundreds of investments that bet on when people would die, an American International Group Inc. unit said at the start of a fraud trial in New York.
Lavastone Capital LLC, the AIG subsidiary, claims Coventry ripped it off of more than $150 million by systematically jacking up prices in a 2006 deal to help it acquire life insurance policies from people seeking to sell them for cash.
“It’s a classic pattern of racketeering over several years,” Lavastone’s lawyer, Randy Mastro, said in his opening statement Thursday in Manhattan federal court.