Buffett questioned in AIG probe
Tuesday, April 12, 2005
NEW YORK -- Billionaire investor Warren Buffett was questioned by regulators Monday in connection with federal and state probes into the insurance company American International Group Inc., saying afterward, "I told them everything I know."
But the attorney for Maurice "Hank" Greenberg, former chairman and chief executive of AIG, said his client would invoke his Fifth Amendment privilege and decline to answer questions from the Securities and Exchange Commission and the New York attorney general's office in an appearance slated for today.
Lawyer David Boies said the large number of transactions being examined and the fact that some occurred years ago "have precluded Mr. Greenberg from adequately preparing this testimony at this time."
Among the transactions under investigation is one between AIG and General Re Corp., a unit of Buffett's holding company, Berkshire Hathaway Inc.
A spokesman for the SEC had no comment on the possibility of Greenberg taking the Fifth.
"That's his right," said Marc Violette, a spokesman for New York Attorney General Eliot Spitzer, whose office also is investigating AIG's business practices and insurance transactions.
Greenberg was forced out in mid-March as allegations of improprieties mounted. When asked by reporters about Greenberg, Buffett replied, "I don't really know anything about that."
In a written statement Monday, Greenberg noted AIG is involved in millions of transactions each year, making it unfair to demand his testimony unless investigators narrow the scope of their questions.
The investigators are looking into a number of reinsurance transactions, which involve insurance purchased by insurance companies like AIG.
Reinsurance traditionally has been used to spread out risk among insurers but, in some cases, it has been used for the questionable purpose of polishing a company's financial statements.