6th Post- Associated Controversies

When a large business like Marsh & McLennan has been open for over 100 years, it’s hard to keep a perfect track record. Within the last few decades, Marsh & McLennan has only had one large controversy, which happened in 2004 with Attorney General Anthony Spitzer. Attorney General Spitzer had been targeting the mutual fund industry for unlawful practices, but once he started focusing on fraud in the insurance industry, h e announced that he had “found widespread wrongdoing”, and Marsh & McLennan was named as one of these “wrongdoing” companies.

Marsh & McLennan was accused of “civil fraud allegations that it steered business to insurance companies in exchange for lucrative payoffs”. They were also accused of “fraud, securities fraud, and antitrust violations, and common law claims for fraud and unjust enrichment”. Marsh & McLennan agreed with Attorney General Spitzer to pay a settlement of $850 million over from 2005 to 2009 to “clients nationwide who were allegedly harmed or misled by Marsh's actions”.  By spreading these payments out, Marsh & McLennan did not have to borrow any money nor did they suffer any financial setbacks in their business doings.

Though Marsh & McLennan did not admit guilt for misleading their customers, they apologized that members of their company “unlawfully deceived their customers”. According to the Chicago Tribune, “The apology was included in the New York attorney general's news release but not in Marsh's. Because the apology is limited to a few people at the company, it does not constitute a formal admission of corporate guilt, Marsh officials said. That distinction will limit future litigation, analysts said”. This was a smart move of Marsh & McLennan, as it ensures that their entire company will not be blamed for the wrongdoing of a supposed few.

Sebok, Anthony J. "Spitzer's Controversial Insurance Lawsuit." CNN. CNN, 1 Nov. 2004. Web. 
"Marsh & McLennan to Pay $850 Million in Settlement." Tribunedigital-chicagotribune. Chicago Tribune, 01 Feb. 2005. Web. 19 Apr. 2016.