American International Group's former Chief Executive Hank Greenberg agreed to pay $15 million to settle regulators' allegations of improper accounting transactions, a Securities and Exchange Commission official said on Thursday.

Howard Smith, AIG's former chief financial officer, also agreed to pay $1.5 million to settle SEC charges relating to Smith and Greenberg's involvement in improper accounting transactions that inflated the insurer's financial results between 2000 and 2005, the SEC official said.

(Reporting by Rachelle Younglai, editing by Maureen Bavdek)