Spitzer probe hands Clydes work

Clyde & Co has picked up 10 mandates in London relating to the investigation launched by US Attorney General Eliot Spitzer into broker Marsh & McLennan (M&M). These include an instruction from Munich Re to look at the terms and conditions of its broking relationships.

It is understood that Munich Re beauty-paraded four law firms for the role – Clyde & Co, DLA, SJ Berwin and US firm LeBoeuf Lamb Greene & MacRae – before plumping for Clydes.

Spitzer’s investigation into M&M, launched two months ago, has had major repercussions for the City insurance market. Spitzer accused M&M of price-fixing and giving kickbacks to insurers that gave it a good deal.

M&M quickly called in Freshfields Bruckhaus Deringer in the UK to conduct an independent inquiry.

While the magic circle firm cleared M&M of the behaviour Spitzer is investigating in New York, the firm did say that a commission system, which rewards brokers for selling particular insurance policies, was widespread. Freshfields found that the system led M&M to put pressure on its brokers to favour certain insurers.

Many other UK insurers are now reviewing their standard broking terms and conditions in response to the Spitzer investigation.

While Clydes is renowned for its insurance practice, it is less well known for its competition capacity – certainly less so than DLA or SJ Berwin – so the Munich Re mandate is something of a coup for the firm.

Clyde & Co declined to comment.