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US: Former Chief of A.I.G. to Refuse to Answer Questions

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Forex Broker Maurice R. Greenberg, a former titan of the insurance industry who is at the center of a wide-ranging investigation into possible financial manipulation, will not answer regulators' questions today, his lawyer said yesterday.

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Online Brokerage "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," Mr. Greenberg said yesterday in a statement.

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Real Estate Broker His lawyers have said that they have not had adequate time to prepare their client and that regulators have denied requests to postpone his testimony.

Bolten officially took over for the former White House chief of staff Andrew H. Card, Jr. on Friday afternoon.

Agency Brokerage Spark Investigators' focus on Mr. Greenberg, the former chairman of the American International Group, the giant insurer, is intensifying. At the same time, their scrutiny of Warren E. Buffett, chairman of the holding company Berkshire Hathaway, appears to have diminished.

Brown was one of 15 former HealthSouth executives who pleaded guilty to a variety of fraud charges after it was discovered that the company had been reporting inflated earnings for years. Forensic accountants working for HealthSouth's new management put the extent of the fraud at nearly $4 billion. Former HealthSouth Chief Executive Richard Scrushy, who had been accused of directing the fraud, in June was found not guilty of all charges by a Birmingham jury even though five former finance chiefs testified that he was aware of and involved in the bogus accounting.

Business Broker In a separate interview with regulators yesterday, Mr. Buffett indicated that he had scant knowledge of a transaction between A.I.G. and a Berkshire subsidiary that is at the heart of the investigation, two people briefed on the interview said. That 2000 deal enabled A.I.G. to bolster its reserves artificially.

Brokerage Account Criminal defense lawyers said Mr. Greenberg's defense team faced few options other than to invoke his Fifth Amendment right against self-incrimination.

Stock Broker "This investigation is at such an early stage, there's no way he can get reassurances from the prosecutor that he will not be the target of criminal prosecution," said Robert Mintz, a former federal prosecutor and partner at McCarter & English.

Brokerage Online Stock Trading Indeed, legal specialists said they were surprised by comments on Sunday by Eliot Spitzer, the New York attorney general, that indicated that he had sufficient evidence to pursue a criminal case against Mr. Greenberg. The comments came even as it appeared that A.I.G., which is cooperating with the investigation, and regulators were on course toward a possible settlement on the investigation into whether it used a number of transactions to dress up its financial appearance.

Broker Justin Ticket Last week, Mr. Spitzer issued a statement that said, "we believe a civil resolution with the corporation will ultimately be achievable."

Real Estate Brokerage On Sunday, however, Mr. Spitzer challenged an assertion made by Mr. Greenberg's lawyer that he did not think he was breaking the law when he initiated the questionable deal with General Re, one of Mr. Buffett's businesses. "Obviously I disagree with that," Mr. Spitzer said on "This Week With George Stephanopoulos" on ABC. "The evidence is overwhelming that these were transactions created for the purpose of deceiving the market. We call that fraud. It is deceptive. It is wrong. It is illegal."

Commodity Broker John Coffee, a securities law expert at Columbia Law School, said: "When you make this kind of statement, it makes it seem you've made the decision to go down a criminal path. It is unusual to make any kind of statement about a witness about likely criminality before you interview him because you hope to get additional evidence."

Brokerage House Mr. Spitzer's comments "would suggest he may be in the cross hairs of criminal prosecution," Mr. Mintz said, referring to Mr. Greenberg.

Real Estate Broker Exam Mr. Spitzer has frequently said that his goal in pursuing corporate malfeasance is industry reform and punishing individual wrongdoers. The A.I.G. board's decision to remove Mr. Greenberg from running the company, and his subsequent decision to resign as chairman, allows Mr. Spitzer and federal regulators to pursue a civil settlement with the company and pursue Mr. Greenberg separately. (Mr. Spitzer can pursue Mr. Greenberg criminally under antifraud provisions of the state Martin Act; the S.E.C. has only civil authority.)

Brokerage Services Mr. Spitzer's decision to do so will be based on the evidence his investigators have. If they believe they have a criminal case, they will have to present it before a grand jury.

Broker Live Ticket Mr. Spitzer's office may choose to go after Mr. Greenberg because he is emblematic of an imperial chief executive who defied regulators and corporate governance critics. Punishing him would send the message that no chief executive, however powerful, is immune to the tougher regulatory environment. But in doing so, Mr. Spitzer faces the risk of being perceived as an overzealous prosecutor determined to punish individuals for some actions that have been common in the insurance industry.

Online Brokerage Firm Still, while it is uncertain that Mr. Spitzer will pursue a case against Mr. Greenberg, it is now obvious that the interests of the former executive and those of the company he built into a global giant are no longer closely aligned.

Security Broker Dealer For months, investigators have been examining transactions that the American International Group and other large insurance companies may have used improperly to burnish their financial results. The deal with General Re, which A.I.G. has since acknowledged was improper, has been the focus of the inquiry.

Coldwell Banker Residential Mr. Buffett's interview with regulators yesterday appeared to confirm that he was not a major player in the 2000 deal.

Freight Broker Investigators' curiosity about Mr. Buffett's role in General Re's dealings with A.I.G. was prompted by two pieces of correspondence that Ronald E. Ferguson, the former chief executive of General Re, wrote concerning the transactions. The first, an e-mail message dated Nov. 6, 2000, was apparently sent to Mr. Ferguson's team at General Re, but was not sent to Mr. Buffett.

Freight Brokerage In the e-mail message, Mr. Ferguson said he and Mr. Buffett shared an exchange in which he asked Mr. Buffett if the A.I.G. transaction "passed the N.Y.T. test," in a reference to The New York Times. Mr. Ferguson said that Mr. Buffett replied that the deal passed that test, "but not by a huge margin." Mr. Ferguson, using Mr. Buffett's initials, refers to him in the message as "the WEB master," according to three people who have read the message and described it over the telephone to a reporter.

Broker Lie Ticket Mr. Ferguson also mentioned the e-mail message in a memo he wrote detailing a conversation he had with Mr. Buffett in November 2000, in which the two men discussed General Re's third-quarter earnings. During the conversation, Mr. Ferguson said, he and Mr. Buffett discussed the A.I.G. transaction.

4th Boost Brokerage By Investigators presented that correspondence to Mr. Buffett during their interview with him yesterday to gauge how much prior knowledge he had of the A.I.G. transactions. Mr. Buffett told regulators that he never conversed with Mr. Ferguson about whether the A.I.G. transaction would draw adverse publicity in the media and that he never passed judgment on the deal's propriety, the two people briefed on the interview said. At the time that Mr. Buffett and Mr. Ferguson communicated about the transaction, it had yet to be completed and was mentioned only fleetingly in their telephone conversation.

Florida Mortgage Broker Two people who have read the e-mail message and are knowledgeable about Mr. Buffett's relationship with Mr. Ferguson said that Mr. Ferguson may have inaccurately described his interactions with Mr. Buffett to make it appear that Mr. Buffett had approved his dealings.

Insurance Brokerage Mr. Ferguson served as General Re's chairman and chief executive from 1987 until 2001. Berkshire bought General Re in late 1998. All of the questionable transactions at General Re that have drawn investigative scrutiny occurred during Mr. Ferguson's tenure as chief.

Online Broker Mr. Ferguson could not be reached for comment.

Brokerage Company After stepping aside as chief executive in 2001, Mr. Ferguson remained as General Re's chairman until retiring in 2002. He still provides consulting services to the company.

Broker Lonely Ticket General Re handled a substantial amount of A.I.G.'s reinsurance business and Mr. Greenberg dominated Mr. Ferguson, according to several people with direct knowledge of the two executives' interactions. That was hardly unusual for Mr. Greenberg, who was a friendly rival of Mr. Buffett over the years.

Commodity Brokerage Their relationship cooled for a while after Mr. Buffett took issue in 1985 with the way the American International Group used reinsurance. That prompted Mr. Greenberg to respond that Mr. Buffett had "a peanut-sized book" of insurance business.

New York Ticket Broker The two men later reconciled. In 1998, they joined forces and linked up with Goldman Sachs in an unsuccessful attempt to buy the portfolio of Long-Term Capital Management, the hedge fund that nearly collapsed that year. Still, the two men have distinctly different personalities.

Prime Brokerage Those who know Mr. Buffett, who is 74, describe him as easygoing and modest, while Mr. Greenberg, 79, has drawn barbs for his imperious style. While Mr. Buffett and Mr. Greenberg have crossed paths in the business world, and A.I.G. was a lucrative client for General Re, Mr. Buffett is said to have preferred maintaining some distance between himself and Mr. Greenberg.

Real Estate Agent Broker Mr. Greenberg's decision not to testify was made firm yesterday morning at the office of one of his lawyers, David Boies. Attending that meeting were Mr. Greenberg; Mr. Boies; Robert Morvillo, another criminal defense lawyer, who represented Martha Stewart; and Kenneth J. Bialkin, another top Wall Street lawyer who was added to Mr. Greenberg's legal team recently, at Mr. Greenberg's request, for a third legal opinion, people briefed on the matter said.

Yacht Brokerage Mr. Bialkin and Mr. Spitzer have known each other for a long time, a spokesman for Mr. Spitzer said last night. Mr. Bialkin was a senior partner at Skadden Arps when Mr. Spitzer was a young associate.

Trucking Broker Recently, when the two men were having breakfast at the Four Seasons, various targets - past and present - of Mr. Spitzer were seated near them in the room, including Sanford I. Weill, the former chief executive of Citigroup, which was among the Wall Street firms investigated over conflicts surrounding analyst research, and Kenneth Langone, a former head of the New York Stock Exchange's compensation committee that approved a $140 million payout to the former exchange chief, Richard A. Grasso. Mr. Greenberg was seated at another table.

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