Delphi Suspends Two In Broker Probe

Delphi Suspends Two In Broker Probe

NU Online News Service, Jan. 3, 1:20 p.m. EST?Delphi Financial Group Inc., an employees benefit services company, said it suspended two of its employees after an internal investigation of contracts brokered through Marsh & McLennan uncovered improper conduct.[@@]

In a statement, the Wilmington, Del.-based company said its review identified "certain potential issues concerning past insurance solicitation practices" that involved a subsidiary, Safety National, based in St. Louis, and New York-based MMC.

The company said the instances are limited in number and involve a "modest amount of premium."

The two employees suspended were responsible for the company's relationship with MMC. Additional action may be taken after the review is complete.

"The company believes that the senior of these employees had been involved in the practices at issue with Marsh in his former employment prior to joining Safety National in the summer of 2002," the company said in a statement. "These practices were neither known to, nor approved by Safety National management."

Delphi said it has reported its findings to the office of New York State Attorney General Eliot Spitzer and the Missouri Department of Insurance.

The issue grows out of what has become a national investigation into abusive insurance placement practices alleged by Mr. Spitzer in a suit filed against MMC in October. Among the allegations, an MMC unit is accused of manipulating the contract bidding process in favor of those carriers paying high, volume-driven contingent commission fees.