Insurance Fraud Lawyers
Marsh & McLennan Fraud
The bid-rigging worked as follows: Marsh & McLennan or AON steered business toward certain insurance companies at designated prices, and then would solicit additional artificial high fake bids from other companies to give the appearance of real bidding. Marsh & McLennan did this even as it claimed in public statements that its "guiding principles" was to consider its clients' best interests "first and foremost." By this activity, Marsh clearly did not consider its client's best interest "first and foremost."
The kick-backs scheme was that insurance brokers such as Marsh & McLennan & AON received from insurance companies commissions over and above their ordinary commissions. These commissions were paid for steering volume business to a particular company's way. Insurance companies called these fees "contingent commissions" or "market service agreements." Many critics have called these commissions for what they are: "undisclosed kickbacks."
These improper fee arrangements apparently date back several decades. Many insurance industry executives say it was known to certain insiders that such insurance company pacts were in place to boost revenue the insurance brokers. However, these payments were never disclosed to the insured which the insurance brokers owe a fiduciary duty to. Critics and Attorney General Eliot Spitzer maintain that these practices are poorly disclosed and are a conflict of interest for brokers ostensibly acting on policy holder's behalf.
Attorney General Spitzer has obtained documentation wherein employees of AIG supplied fake quotes to provide the illusion of competitive bidding for Marsh & McLennan clients knowing that another insurance company would nonetheless win the bid. Attorney General Spitzer's investigation includes AIG Insurance Company, Bermuda based Ace Insurance Company, Hartford Insurance Company, and others.
Marsh & McLennan received $800 million in revenue from contingent commissions in 2003 - the equivalent of more than half of its $1.5 billion income.
Marsh & McLennan cheated its own corporate clients by rigging bids and collecting huge fees from insurance companys for throwing business their way, not disclosing it to their clients thereby not acting in the policy holder's best interest. If this occurred to you and/or your company, please immediately contact our law firm as we are vigorously pursuing class actions against Marsh & McLennan.
The effect of contingent commissions are that they reward brokers for hitting profit or volume targets which provide brokers a financial incentive to choose one company over another, even though the other company offered a better price or better terms.
If you or your business purchased insurance through Marsh & McLennan, please call us immediately or please complete the insurance fraud evaluation form. The Law Offices of Nadrich & Cohen, LLP works on a contingent fee basis only.
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