Two More Plead Out In Spitzer Probe

NU Online News Service, Nov. 16, 4:56 p.m. EDT?New York Attorney General Eliot Spitzer announced today that two underwriters from Zurich American Insurance Company have pled guilty to misdemeanor charges in connection with bid rigging.[@@]

The pair were identified as Edward Coughlin and John Keenan.

In pleading guilty in Manhattan Criminal Court, they admitted to following and executing the directions from a supposedly neutral broker to submit bids designed to lose, thus awarding the business to the designated "winner."

According to the attorney general, both worked in a section of the Specialties Excess Casualty Unit at Zurich and dealt with Marsh Global Broking, which has been sued by Mr. Spitzer for bid-rigging and taking payoffs to steer business to cooperating insurers.

Both face up to a year in prison. They, along with three other insurance company employees who previously entered guilty pleas, are expected to testify in future cases, Mr. Spitzer's office announced.

Elsewhere on the broker insurer investigation front, Princeton, N.J.-based Munich American RiskPartners, a division of American Re Insurance Company the U.S. subsidiary of Munich Re in Munich, said it had received subpoenas in two states.

In North Carolina, the company outlets American Re-Insurance Company and American Alternative Insurance Corporation, have received subpoenas, as have other licensed insurers in that state.

In Texas, Munich's American Re Corp. unitwas subpoenaed.

Both inquiries focus on conduct with respect to business in their respective states, according to American Re Insurance Company Associate General Counsel M. Patricia Casey.

Also, RLI Corp. in Peoria, Ill. said it had been subpoenaed by the Illinois Department of Insurance in connection with an industry-wide investigation into broker compensation. RLI said it believed it is not a target of the investigation.

Separately, Markel Corporation reported yesterday that several of its subsidiaries have received document requests or administrative subpoenas from state insurance departments related to producer compensation arrangements. The Richmond, Va.-based insurer said that management believes these requests are part of broad surveys of industry practices and are not targeted at any particular actions of the Company's subsidiaries.

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Two More Plead Out In Spitzer Probe

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