Settlements of bid-rigging and contingency fee abuse charges by top brokers might have resulted in a loss of credibility for corporate insurance buyers who had the wool pulled over their eyes, according to one risk manager who started the fight for greater transparency years ago.

“Let’s say I was entitled to $600,000 in a broker settlement,” explained Susan Meltzer, speaking in her capacity as president of the International Federation Of Risk & Insurance Management Associations. “In my view, that would be like telling the CFO that I’ve wasted that much money and that [New York Attorney General] Eliot Spitzer got it back for my company.”

Ms. Meltzer pushed hard for broker compensation disclosure when she was president of RIMS in 1999-2000. The result was a “don’t ask, don’t tell” policy, in which brokers were obliged to reveal their financial arrangements with carriers if risk managers bothered to ask–and many did not.

Ms. Meltzer, who is now assistant vice president of risk management at Aviva Canada Inc.–a property-casualty insurer in Toronto–said most risk managers took the view on broker settlements that “they had gotten a bonus,” which “seemed to be okay with their senior management.”

This, she said, is an indication senior managers “still don’t really get what the risk manager is actually doing, and they still don’t understand the structure of the brokerage fees.” Otherwise, she said, “there would have been more anger about receiving settlements.”

She said some risk managers are confused about how to establish a proper enterprise risk management function. “Management is wondering why their insurance risk manager isn’t doing that,” she said–adding, however, that many traditional, insurance-buyer risk managers “don’t have the strategic skills to do that.”

As a result, she said, risk managers could be missing an opportunity. “There has to be a little bit of shaky ground, given that they weren’t managing their most important relationship properly,” she said. “And given that they’re not seen as the thought leaders for ERM; those who would be are coming out of finance.”

In fact, she said, “finance may be taking over this territory because the risk manager hasn’t been able to stand up to do it.”