The Hartford Courant reports that the lawsuit accused the firm of concealing payments of contingent commissions to insurance brokers and participation in bid-rigging schemes. The Hartford was implicated in New York Attorney General Eliot Spitzer’s 2004 bid-rigging lawsuit against Marsh Inc., but was not named as a defendant (See Spitzer Takes On Contingent Commissions ).
In the civil suit, according to the Courant, The Hartford said its payment of contingent commissions had been disclosed in state and federal filings, four lawsuits and press reports, so shareholders should have been aware of it by July 2001, when the last of the four suits was filed.
According to the news report, the court agreed saying, “there was clearly enough information available to place the plaintiffs on notice of the large majority of the fraud they allege.” Plaintiffs included the Communications Workers of America Plan for Employees’ Pensions and Death Benefits and the Alaska Laborers Employers Retirement Fund.
The Hartford set aside a $66-million reserve i n April 2005 to have funds available to resolve federal and state government market timing and directed brokerage investigations involving its mutual funds and annuity businesses (See Hartford Sets up $66M Legal Reserve for Probes ).