Regulators questioned Warren Buffett yesterday in connection with federal and state investigations into the insurance company American International...
NEW YORK — Regulators questioned Warren Buffett yesterday in connection with federal and state investigations into the insurance company American International Group (AIG), with the billionaire investor saying afterward, “I told them everything I know.”
But the lawyer for Maurice Greenberg, AIG’s former chairman and chief executive, said his client would invoke his Fifth Amendment privilege and not 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 under scrutiny and the fact that some occurred years ago “have precluded Mr. Greenberg from adequately preparing this testimony at this time.”
Among the transactions is one between AIG and General Re, a unit of Buffett’s holding company, Berkshire Hathaway.
Most Read Stories
- Scientists say recent quake swarm at Rainier is not unusual
- FBI investigating off-duty work by Seattle police at construction sites, parking garages
- 'Polite Robber' suspect told similar sob story when arrested 8 years ago
- Swastika-wearing man punched on Seattle street, removes swastika, police say
- Is this Seattle bus stop the worst in America?
Buffett spoke to reporters as he left the Woolworth Building in Manhattan, where the SEC has an office. Asked whether General Re turned over documents in exchange for leniency, Buffett said, “No. We complied with the subpoena.”
Buffett, accompanied by one man believed to be a Berkshire Hathaway attorney, entered a side door at the building yesterday morning, avoiding more than two dozen reporters and camera-crew members at the front entrance.
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 yesterday, 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.
“I am willing to accept responsibility and to account for the performance of my duties, but I believe that good order and fairness require that I have an adequate opportunity to be advised of the issues to be investigated and to my alleged involvement therein,” Greenberg said.
Investigators are examining reinsurance transactions, which involve insurance purchased by insurance companies like AIG. Reinsurance traditionally is used to spread out risk among insurers but, in some cases, it has been used to polish a company’s financial statements.
In the case under review, AIG purchased reinsurance from General Re in the fourth quarter of 2000 and first quarter of 2001. Investigators have said AIG used the deals to pump up its reserves when markets were uneasy about the company’s outstanding liabilities.
AIG has said its accounting for the transactions with General Re “was improper and, in light of the lack of evidence of risk transfer, these transactions should not have been recorded as insurance.”