If XL had any more knowledge than the general public that SCA would turn out as bad as it did, $500M of shares would not have been repurchased at prices between $58 and $73 in the fourth quarter. Moreover, it is not clear whether a review of non-public information would have revealed any more than public information would have as of June 2007. The real evidence at this point, as far as I can tell, would have been revealed by MBS deal statistics (which clearly show awful credit characteristics) and early increases in default rates.
It seems perfectly valid to blame XL and SCA for not seeing things, but the idea that there was some devious dumping of SCA shares seems like a stretch. But who knows? I could be wrong. If anyone else can share any solid evidence to the contrary, it would be interesting to hear.