NEW YORK (Bloomberg) — Former American International Group Inc. chairman Maurice (Hank) Greenberg, identified by US prosecutors as an unindicted co-conspirator in an accounting fraud case that led to five convictions, said the defendants turned to fraud after they were unable to complete the legitimate transaction he requested.

Greenberg, who led New York-based AIG for 38 years before being replaced in 2005 amid probes of the accounting and sales practices, made the comments in response to a judge's ruling denying defendants' motions for a new trial. Evidence presented by the government was "sufficient" to lead a jury to conclude that the conspiracy began with a phone call by Greenberg, US District Judge Christopher Droney said in his ruling.

The defendants, four of whom used to work at Berkshire Hathaway Inc.'s General Re Corp. and one at AIG, turned to fraud "to get the deal done", Greenberg's spokesman, Glen Rochkind, said in a statement yesterday. The five, including former General Re CEO Ronald Ferguson, were found guilty in February of helping AIG, the world's largest insurer by assets, fraudulently boost loss reserves.

"Mr. Greenberg has always acted ethically, responsibly and legally in all of his business and personal actions," Rochkind said. "Mr. Greenberg was not a defendant, had no opportunity to defend himself or present evidence in his defence, and had no standing before the court."

Greenberg, 83, hasn't been charged. Assistant US Attorney Eric Glover called him an unindicted co-conspirator during the trial in February.

"Starting with Greenberg's October 31, 2000, phone call to Ferguson, there was an agreement to carry out a transaction to artificially inflate AIG's loss reserves and deceive AIG's investors about the amount of the company's loss reserves and the quality of its earnings," US District Judge Christopher Droney wrote in the May 15 ruling from federal court in Hartford, Connecticut, revealed yesterday.

The deal between AIG and General Re arose after AIG reported on October 26, 2000, that premiums increased in the third quarter of that year as reserves for claims fell.