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What was the government allegations on AIG and Marsh & McLennan in late 2004? What made...

What was the government allegations on AIG and Marsh & McLennan in late 2004?

What made the relationship between AIG and Marsh special at that time?

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Answer #1

The government allegations on AIG and Marsh & McLennan in late 2004 were that Marsh & McLennan duped its clients by steering them to insurers with whom the company had lucrative contingency agreements. This led to solicitation of rigged bids with regards to insurance contracts from major insurers. Two executives of AIG were criminally involved in connection with the scheme. Thus the government allegations on AIG and Marsh & McLennan in late 2004 were based on the premise of fraud and anti-competitiveness practices that they perpetrated in the insurance industry.

The relationship between AIG and Marsh at that time was special as both the companies had contingency agreements that were lucrative and attractive for both the companies. Marsh & McLennan took large sum of payoffs from AIG in order to send them clients.

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