Four former insurance executives of General Re Corp., a reinsurance unit of Berkshire Hathaway Inc., as well as one former executive of AIG Inc., will go to trial on Jan 7. over a seven-year-old reinsurance transaction that federal prosecutors claim to be a fraud.


What's their defense?  Before the transaction they asked Warren Buffet, known as the "Omaha Oracle" for his business and investment savvy and strong integrity, if it was legitimate, and the transaction received his seal of approval.  It wouldn't be a sufficient defense for the alleged crimes, which include fraud and conspiracy, but it could raise the question of whether the defendants knew that what they were doing was wrong when they did it.

Warren Buffet told investigators that he did not know all of the details of the transaction when he was consulted.  The 77 year-old-investor will only be called by prosecutors to testify if he is needed to refute the defense's evidence regarding his approval of the deal.  Otherwise he will likely keep his distance from the trial.