Friday, October 15, 2004

Insurance criminals

...

Arrests, Lawsuit In Insurance Probe Investigation Implicates The
Hartford, Others In Bid-Rigging Scheme


October 15, 2004 By
DIANE LEVICK, Courant Staff Writer

Sending shudders across the insurance
industry, New York authorities Thursday said they have sued the world's largest
insurance broker, arrested two executives at another company, and implicated
several insurers - including The Hartford - in a widening corruption probe.

New York Attorney General Eliot Spitzer said his state's investigation
challenges a longstanding system of "lucrative payoff agreements" between
insurers and brokers involving billions of dollars.

The practice
inflates the premiums paid by businesses and other organizations nationwide, he
said.

As part of the system, insurance brokers and companies have rigged
bids and steered customers, deceiving them into thinking there was real
competition for their business, Spitzer said.

New York's action sent
stock prices of many property casualty insurers and brokers plunging. More
from the Hartford Courant


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