Eight ex-Marsh officials indicted over bid-rigging

Reuters
September 15, 2005


NEW YORK, Sept 15 (Reuters) - New York Attorney General Eliot Spitzer on Thursday indicted eight former Marsh & McLennan Cos. executives for their roles in a bid- rigging scheme, a step that may lead to the first trials in his sweeping investigation of insurance industry practices.

The executives were charged with 37 counts, including grand larceny and scheming to defraud. All worked for Marsh Inc., a unit of the world's largest insurance broker. They are expected to be arraigned Thursday before New York Supreme Court Justice James Yates. Marsh itself does not face criminal charges.

"No one can dispute that, in the insurance industry, there was massive fraud," Spitzer said at a press conference.

He also said more indictments were possible, adding: "We won't close the book on Marsh prosecutions."

The eight former executives include managing directors Kathleen Drake, William Gilman, Edward McNenney and Joseph Peiser, senior vice presidents Greg Doherty, Thomas Green and William McBurnie and assistant vice president Edward Keane.

Spitzer said that between November 1998 and September 2004, the defendants colluded with executives at ACE USA, American International Group Inc., Liberty International Insurance Co., Zurich American Insurance Co. and others to rig the market for excess casualty insurance.

If convicted on the top counts, Doherty, Gilman, Green, McNenney and Peiser face up to 25 years in prison, while the remaining defendants face up to 15 years, Spitzer said.

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