What can you get for $14.5 million?
If you are an businessman from Abu Dhabi you can get at license plate.
Maybe a case of wine with a few bucks left over for cheese.
But if you are the Commonwealth of Kentucky you can pay insurance premiums to some guys with a questionable track record.
From fiscal year 2007 to the present the Commonwealth of Kentucky has paid $14,542,573.58 in insurance premiums to MARSH USA INC.
Marsh is a subsidiary of Marsh & McLennan Companies, Inc. (MMC), a global professional services firm with annual revenues exceeding $9 billion. In addition to Marsh, MMC is the parent company of Putnam Investments, one of the largest investment management companies in the United States; Mercer Consulting Group, a major global provider of consulting services; and MMC Capital, a global private-equity firm.
Marsh USA Inc. has also been found guilty bid rigging in a number of states.
“Connecticut Attorney General Richard Blumenthal amended a previously filed complaint on Sept. 21 against Marsh & McLennan Companies, Inc., Marsh & McLennan, Inc. and Marsh USA Risk Services, Inc. d/b/a Marsh USA, Inc. (collectively "Marsh") alleging violations of the Connecticut antitrust laws, the Connecticut Unfair Trade Practices Act and breach of contract stemming from Marsh’s use and alleged abuse of Placement Service Agreements.”
Marsh shall pay Eight Hundred Fifty Million Dollars ($850,000,000) into a fund (the “Fund”) over the next four years in four annual payments to be paid to Marsh’s policyholder clients who retained Marsh to place, renew, consult on or service insurance where such placement resulted in contingent commissions or overrides.
California:
California:
The Accusation alleges that Marsh, through the actions of certain former employees, while acting as an insurance agent or broker: (1) Steered business to certain insurance companies to maximize its revenue; (2) Failed to fully disclose commissions to clients; (3) Deceived clients into believing the clients were obtaining the least expensive insurance Marsh could obtain; (4) Perpetrated the alleged deception by conspiring with certain insurance companies to have those insurers submit fictitious, artificially high bids, which Marsh then presented to its clients; (5) Failed in some instances to obtain the best terms possible for its clients in accordance with the client’s express needs or desires regarding coverage, price, or service, and failed to exercise reasonable care, skill, diligence and judgment in seeking insurance for its clients; and (6) Failed to disclose information that it knew or reasonably should have known regarding deficiencies (with respect to coverage, price, or service) in the coverage it obtained relative to the insured’s
express needs and desires;
And about 30 other states:
express needs and desires;
And about 30 other states:
In addition to investigations and reviews by a number of insurance commissioners, Marsh also has been targeted by several state attorneys general. Earlier this month, the company confirmed in a filing with the U.S. Securities and Exchange Commission that it received a letter from a state attorney general threatening to file a civil suit against the company unless a resolution was reached Sept. 13. The company didn't name the state attorney general who sent the letter (BestWire, Sept. 12, 2005).
I guess I’m old school, when you know someone lies, cheats and steals you don’t do business with them. I guess that’s why I’m not the Governor, or Secretary of Finance, or Commissioner of Insurance and the $14.5 million is just tax dollars.
