Under the felony charges of grand larceny, those indicted could face a maximum of 15-to-25 years in prison.

"These former Marsh managers are accused of colluding with leading insurance companies to arrange non-compete bids and conveying these bids to Marsh clients under false pretenses," Mr. Spitzer declared during a press conference. Charged in the indictment were:

o William Gilman, executive marketing director and managing director (released on $100,000 bail).

o Joseph Peiser, head of global broking in excess casualty and managing director (released on $75,000 bail).

o Edward J. McNenney, global placement director and managing director (released on $75,000 bail).

o Greg J. Doherty, ACE local broking coordinator team leader and senior vice president (released on $50,000 bail).

o Thomas T. Green Jr., senior vice president (released on $35,000 bail).

o Kathleen M. Drake, local broking coordinator team leader and managing director (released on $35,000 bail).

o William L. McBurnie, coverage and carrier specialist and senior vice president (released on $35,000 bail).

o Edward J. Keane Jr., assistant vice president (released on his own recognizance).

A representative for Marsh's corporate parent–Marsh & McLennan Companies, in New York–said the eight executives had left the firm within the last 11 months.

The indictments are part of Mr. Spitzer's ongoing investigation of the insurance industry that began over a year ago, resulting in a suit against MMC that would eventually prompt the ouster of its chief executive, Jeff Greenberg; agreements to abolish contingency commissions (not only by MMC but by Aon, Willis and Arthur J. Gallagher); along with settlement payments of over $1 billion to clients.

The latest indictments allege that the eight, from November 1998 to September 2004, "colluded with executives at American International Group, Zurich American Insurance, ACE USA, Liberty International Insurance Company and others to rig the market for excess casualty insurance," Mr. Spitzer's office said.

According to the indictment, the alleged scheme involved working with the insurers to determine which would win a particular piece of business, setting a target premium for the predetermined winner, and obtaining losing bids to make the shopping process appear to be genuine. Marsh earned bonus contingency fees based on volume from the carriers involved.

"Not only was this wrong, but it was harmful to the economy," said Mr. Spitzer. "It skewed the system and added to the already high cost of insurance. It subverted the fundamental principal of our economy, which is full, free and fair competition. There is simply no responsible argument for a system that rigs bids, stifles competition and cheats customers."

Some of the corporate buyers that were allegedly defrauded were State Farm Mutual Automobile Insurance Company, Fortune Brands Inc., Vivendi Universal S.A, Intel Corp., Fidelity National Financial Inc., Cisco Systems Inc., E&J Gallo Winery, Merle Norman Cosmetics, Neiman Marcus Group Inc. and others.

Mr. Spitzer said that a total of 17 executives at five companies have so far pleaded guilty in his probe, adding that he expected more to come. He said there will be additional individual actions, as well as action against those carriers that were a part of the alleged scheme. "The work in this area is not complete," he said. "As part of our ongoing investigation, I am currently negotiating an end to such practices with several insurance entities."

Asked to respond to those who have suggested he has been overzealous in his prosecution of the financial services industry, Mr. Spitzer said there will always be apologists among the powerful, but no one can dispute that there was massive fraud in the insurance and securities industries that he has uncovered during his tenure as attorney general.

On his investigation into American International Group over the alleged misuse of finite reinsurance to artificially bolster the carrier's balance sheet, he said his office is seeking a resolution with the company. He noted the change in leadership at AIG, adding that internal changes the company is making should lead to a resolution.

In a statement, MMC President and Chief Executive Officer Michael G. Cherkasky emphasized that the latest charges do not involve the firm, noting that Mr. Spitzer's problems with Marsh were resolved with an agreement between MMC and the attorney general earlier this year.

"This indictment is about the past," said Mr. Cherkasky. "MMC today is focused on the future and is committed to excellence and the highest standards of professionalism and service."

However, MMC said earlier in the week that numerous state attorneys general and insurance regulators might seek additional fines stemming from its brokerage unit's alleged bid-rigging activity with insurers.

In an 8-K filing with the Securities and Exchange Commission, MMC said one state attorney general, whom it failed to identify, intends to file a civil claim if no settlement is reached. The filing came in connection with an offering of $1 billion of senior notes, which the company intends to use to repay a portion of its outstanding bank borrowings and accrued interest.

In addition, MMC last week named Brian Storms to head Marsh. He most recently served as president and CEO of Mercer Human Resources Consulting, another MMC subsidiary. Michael Caulfield will take over as president of Mercer, moving up from his current post as chief operating officer.

"With Marsh making progress in its recovery, it is time for me to dedicate my full attention to refining and implementing MMC's overall growth strategy," said Mr. Cherkasky, in a prepared statement.

(Additional reporting by Steven Tuckey.)

Quotebox, with Spitzer mug:

"The work in this area is not complete. As part of our ongoing investigation, I am currently negotiating an end to such practices with several insurance entities."

N.Y. Attorney General Eliot Spitzer