NU Online News Service, June 28, 2:47 p.m.EDT

Two ex-Marsh executives are accusing their former employer ofmaking them “scapegoats” to avoid criminal prosecution by colludingwith the New York attorney general to have the two indicted overallegations they engaged in an improper kickback scheme.

Former Marsh executives William Gilman and Edward J. McNenneyJr. filed an amended complaint with the U.S. District CourtSouthern District of New York. The two men filed their originalsuit in 2010.

The suit says that the insurance brokerage firm Marsh, asubsidiary of Marsh & McLennan Cos., colluded with the attorneygeneral to avoid criminal indictment and instead be subject tocivil penalty.

The company ultimately paid a penalty of $850 million in 2005after allegations were made by then-New York Attorney General EliotSpitzer that executives engaged in steering certain accounts inMarsh's global broking practice to insurers that paid lucrativecontingent commission fees. The broker was also banned from accepting contingent commissions until 2010.

The suit charges that Spitzer negotiated to have his good friendMichael Cherkasky named chief executive officer after theresignation of then-CEO Jeff Greenberg in late 2004.

The suit says Spitzer engaged in the collusion in an effort to“bolster his crime-fighting credentials,” as he sought theDemocratic nomination for governor of New York in 2006.

Gilman and McNenney contend that the engagement in contingentcommissions was perfectly legal and that they cooperated in allinternal investigations without hesitation. Both were fired fromtheir jobs without cause, the suit contends, and Gilman was“unfairly denied” his eligible retirement.

Both men were also denied severance pay they were entitled to,the suit contends, noting that others who were released for theirinvolvement in the alleged scheme did receive severance.

In 2005, eight executives from Marsh were indicted on fraud and larceny charges, including Gilman andMcNenney.

A spokesman for Marsh & McLennan Cos. declined to comment onthe particulars of the case, but issued a statement saying, “Thedecision to prosecute William Gilman and Edward McNenney was madeby the former New York attorney general and a grand jury; not byMarsh.”

The charges against the two men were eventually dropped aftertheir conviction in 2008. The convictions were subsequentlyvacated in 2010 on the withholding of evidence that the judgesaid could have impacted the verdict.

The attorney general's office formerly withdrew the charges in 2011.