Greenberg Declines to Answer Questions in Deposition

The former AIG chairman exercises his Fifth Amendment rights.
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Maurice "Hank" Greenberg declined to answer questions Tuesday from investigators poring over the finances of his former company,

American International Group

(AIG) - Get Report

.

A spokesman for the former AIG chairman and CEO said Greenberg asserted his constitutional right against self-incrimination during a highly publicized deposition in New York.

"He invoked his privilege to refuse testimony," said Howard Opinsky, a Greenberg spokesman, in an email response.

Greenberg, according to a person familiar with the deposition, asserted his constitutional right against self-incrimination "dozens of times." By the end of the deposition, prosecutors simply allowed Greenberg to say "same answer" to invoke the privilege.

Greenberg's decision not to testify under oath was no surprise. For the past several days, his lawyers have said the 79-year-old insurance industry titan would not answer questions from regulators because they needed more time to review documents.

In the days leading up the deposition, taken at the Lower Manhattan office of New York Attorney General Eliot Spitzer, Greenberg's lawyers asked for the proceeding to be postponed. But Spitzer's office refused.

A spokesman for the New York prosecutor declined to comment.

In a column in Tuesday's edition of

The Wall Street Journal

, David Boies, one of Greenberg's attorneys, offered a rationale for the former chairman's refusal to testify. Boies said it was unfair to expect Greenberg to testify without more preparation, since the "accounting decisions at issue were made between five and 20 years ago."

"He also looked forward to the opportunity to defend himself against the leaked charges that have appeared in the press," Boies, wrote in the column. "On the other hand, the risk of being set up by open-ended questioning before he had had an opportunity to review documents concerning events manyyears ago was great."

Prosecutors and regulators from the

Securities and Exchange Commission

and the New York Department of Insurance had been expected to ask Greenberg about his involvement in questionable reinsurance transaction with General Re, a division of Warren Buffett's

Berkshire Hathaway

(BRKA)

conglomerate.

On Monday, Buffett met with regulators and prosecutors from Spitzer's office to discuss his knowledge of the Gen Re transaction, which added $500 million in reserves to AIG's balance sheet. Buffet was not under oath, and Spitzer has labeled the so-called Oracle of Omaha as a witness in the AIG investigation rather than a target.

Investigators believe the Gen Re deal did not involve any real transfer of risk to AIG and was done solely to spruce up the big insurer's books. Even AIG has admitted that its accounting for the Gen Re transaction was faulty.

The meeting with Buffett was described by some as cordial.