Goldman, AIG face off in Congress over swap values

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WASHINGTON—Goldman Sachs Group Inc. executives defended valuations for credit-default swaps that were presented to American International Group Inc. during the financial crisis, saying they reflected actual market prices.

That sparring between the two firms, which dated back to 2007, moved into the public eye Thursday as the Financial Crisis Inquiry Commission asked executives to describe a collateral dispute about AIG’s swaps that took place in the year before AIG collapsed in 2008.

The U.S. government ultimately bailed out the insurance firm.

More broadly, the panel is seeking answers about the role that derivative products played in the financial meltdown. In separate testimony, Gary Gensler, the chairman of the Commodity Futures Trading Commission, said in prepared remarks that “I don’t think anybody would disagree that AIG and its derivatives played a central role in the crisis.”

Full story: Goldman, AIG Face Off in Congress Over Swap Values –