AIG giving Federal Reserve Two Life Units? A bad deal for taxpayers?

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NEW YORK—American International Group Inc.'s move to give the Federal Reserve Bank of New York preferred interests in two life insurance units in exchange for cutting AIG's debt by $25 billion is a logical strategy in light of market conditions, observers say.

Analysts say the step reflects the current difficulty that AIG faces in getting appropriate compensation for the two units—American International Assurance Co. Ltd and American Life Insurance Co.—either through an initial public offering of stock or a private transaction.

http://www.businessinsurance.com/article/20090628/ISSUE01/306289992

Anyone auditing these entities? What is the CURRENT condition is their business? Didn't many overseas cash in their life insurance policies and other investments when AIG had diffuculty last year? I seem to recall many new reports of foreign policy holders losing confidence in AIG. Some reported a RUN on AIG. Are these units big bags of DEBT being forced on taxpayers?

Who is looking out for the taxpayers best interests? Is this another 'pass-through' of taxpayer money? Filling the pockets of rich speculators?