Eliot Spitzer, the New York attorney general, filed a lawsuit today accusing the Marsh & McLennan Companies, the world’s largest insurance broker, of cheating its corporate customers by rigging bids for the insurance coverage they bought.
At the same time, two executives of the American International Group, one of the world’s largest insurance companies, pleaded guilty to criminal charges of rigging bids that Marsh & McLennan presented to its customers, Mr. Spitzer said in a news conference at his office in lower Manhattan.
The lawsuit also names American International, the Hartford Financial Services Group, Ace Ltd. and an American unit of Munich Re as participants in “steering and bid rigging.”
As of early afternoon, the defendants could not be reached for comment or had not yet responded to requests for comments.
Mr. Spitzer’s investigation, which began earlier this year, has centered on contingency fees that insurance companies pay to insurance brokers who steer them business. Brokers have a fiduciary duty to find the best coverage at the best price for their clients. At issue is whether the fees encourage insurance brokers to put their own interests ahead of the interests of their clients.