The share price of the world's largest insurance broker, Marsh & McLennan, tumbled yesterday amid allegations of corruption from the New York attorney general Elliot Spitzer.
Spitzer filed the lawsuit claiming that Marsh was responsible for rigging business, stifling competition and cheating customers, the national press has reported today.
Insurers Ace, AIG, The Hartford and Munich American Risk Partners have also been named by Spitzer as participants in the lawsuit.
Shares in Marsh & McLennan, headed by Jeffrey Greenberg, dropped by 25%.
Shares in AIG, the company headed by Greenberg's father Maurice, fell 10%.
At a press conference given on Thursday Spitzer hinted that corruption was widespread and more allegations could be on the way.
The attorney general said two AIG executives had pleaded guilty. Karen Radke and Jean-Baptist Tateossian, said Spitzer, were cooperating with investigations.
In a statement Marsh & McLennan said it was committed to working with the district attorney's office.
It said: “We are committed to getting all the facts, determining any incidence of improper behaviour, and dealing appropriately with any wrongdoing.
AIG said it had cooperated fully with the investigation and had been in touch with regulators about the situation.
Ace said it would continue to cooperate on the matter.
