Billionaire Warren Buffett, on the prosecution witness list in the criminal trial of former General Reinsurance chief executive Ronald Ferguson, may not be called to testify, the US government has revealed in filings made to the court.
Mr Ferguson (65) is scheduled to go on trial for fraud next Monday in Hartford, Connecticut.
He wants jurors to see documents that he claims show Mr Buffett, chairman of General Re parent Berkshire Hathaway, approved reinsurance contracts that prosecutors say helped American International Group (AIG) inflate reserves by $500 million (€342.68 million) in 2000 and 2001, deceiving investors about its ability to absorb losses.
Cologne Re Dublin, an IFSC-based subsidiary of General Re, is known to have played a central role in the transactions in question. The US government argued that Mr Ferguson's lawyers should not be permitted to bring up claims of Mr Buffett's involvement in their opening remarks, because they amount to hearsay.
"The reason Mr Buffett appears on the government's witness list is to rebut any suggestion by the defendants that he was involved in or approved" the disputed deal, the government said.
"Absent this evidence, the government does not intend to call him as witness" and create a distraction, the court filing said.
Charged with conspiracy, securities and mail fraud, and making false statements are former General Re chief financial officer Elizabeth Monrad (53); Christopher Garand (60), a former senior vice-president; Robert Graham (59), former assistant general counsel; Christian Milton (60), the former head of reinsurance at AIG; and Ferguson. All have pleaded not guilty.
Mr Buffett (77) has denied knowledge of improper dealings. General Re sells coverage to insurance companies and is a wholly-owned unit of Nebraska-based Berkshire.
AIG, the world's largest insurer, last year agreed to pay $1.64 billion and reverse transactions, including the one at the centre of the upcoming trial, to settle inquiries into sales and accounting practices that led to the ousting of Maurice "Hank" Greenberg, the New York-based company's former chief executive.
Defence filings identify Mr Greenberg as an unindicted co-conspirator.
Mr Greenberg has denied any wrongdoing.
(Bloomberg)
