UPDATE 1-Lawyers make final joust in AIG stock case

(Recasts throughout to add details from closing arguments, background)

By Lilla Zuill

NEW YORK, July 6 (Reuters) - Maurice "Hank" Greenberg, former chief executive of American International Group Inc (AIG.N), fabricated documents and lied under oath in a bid to rewrite history and cloud who is the rightful beneficiary of a valuable block of AIG stock, AIG lawyer Ted Wells told a federal jury on Monday.

Wells called Greenberg's assertions at trial that the beneficiary was always a charitable trust no more than an attempt to cover up a pledge made 35 years earlier.

AIG contends Starr International, a private company that was once closely affiliated with the insurer, formed a trust in the 1970s to hold AIG stock to fund a retirement plan for senior managers. The compensation plan was thrown out within days of Greenberg's ouster from the insurer in 2005.

"What do they do when Greenberg is fired? They go out and rescind ... their oath. That is part of the cover-up," said Wells.

David Boies, a lawyer for both Greenberg and Starr International, told the court that AIG was the one guilty of fabrication. "The truth is that AIG has made up (the trust) for the purposes of this litigation."

An eight-person federal jury has the task of deciding whether the trust that AIG claims was established was breached, and whether Starr International unlawfully sold shares to fund investments across the world.

Billions of dollars are at stake. If AIG wins, Starr International could have to cough up as much as $4.3 billion in proceeds from stock sales over the past three years, and relinquish 185 million shares of AIG stock. Starr says the proceeds of sales were closer to $2.9 billion.