ACE Reports Subpoena Blitz

By Daniel Hays

NU Online News Service, March, 16, 5 :16 p.m. EST?Bermuda-based ACE Ltd. reported that, in addition to an investigation of its business practices by the New York Attorney General's Office, it is being examined by prosecutors and regulators in 12 other states.[@@]

The company, in its annual form 10-K report on file with the Securities and Exchange Commission, said altogether it has received 43 subpoenas as well as letters of inquiry and other demands from investigating agencies.

ACE first surfaced as a target last October when Mr. Spitzer's office named it in a civil suit as one of several insurers involved with Marsh Inc. in a scheme that involved payments of contingency fees to the brokerage to have business steered the insurer's way. The arrangement, it was alleged, involved price-fixing and submission of phony bids.

ACE listed legal inquiries from attorneys general in Connecticut, Florida, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Texas and West Virginia and Washington, D.c.

Insurance commissioners and other regulators from California, Florida, Illinois, Maryland, Michigan, Minnesota, New York, North Carolina, Pennsylvania and Texas have also contacted ACE.

In addition, ACE noted that Mr. Spitzer and the SEC have issued subpoenas for information relating to "non-traditional or loss mitigating insurance products."

ACE said it is cooperating with the requests for material. Since it was named in the New York suit, one ACE employee has pleaded guilty to misdemeanor charges related to dealing with Marsh, two employees have been fired and three are on suspension. The company has an ongoing internal investigation underway led by former Manhattan U.S. Attorney Mary Jo White.

ACE listed Chief Executive Officer Evan Greenberg's salary as $1 million in 2004, with a $2.7 million bonus. The company reported he is due to get a raise of $25,000 this year.

In the wake of Mr. Spitzer's investigations Evan Greenberg's father, Maurice Greenberg, was replaced Monday as CEO of American International Group Inc. after 37 years.

His older brother, Jeffrey, was CEO of Marsh & McLennan, the Marsh parent company. He left after Mr. Spitzer said he could not deal with the MMC management at that time.

Special Reports /

ACE Reports Subpoena Blitz

Related Stories

Recommended For You