Jeffrey W. Greenberg spent five years at the helm of Marsh & McLennan Cos. (MMC ) before New York State Attorney General Eliot Spitzer went after the $12 billion financial-services firm. In mid-October, Spitzer charged the company's insurance-brokerage unit with bid-rigging and accepting kickbacks, among other allegations. Greenberg stepped down on Oct. 25.
It was the last in a long line of blows for Greenberg, 53, a son of American International Group Inc.'s (AIG ) Maurice R. "Hank" Greenberg. Early on in his tenure, almost 300 Marsh Mac employees died in the September 11 attack on the World Trade Center. Two years later, enforcers charged Putnam Investments, a Marsh Mac unit, with securities fraud relating to late trading and market-timing of its funds. In March, 2004, the Securities & Exchange Commission started investigating Mercer, the firm's pension-consulting arm, for alleged "pay to play" practices -- that is, forcing investment managers to pay big fees to get Mercer to recommend them to pension funds. Marsh Mac denies that. Then, just two months later, Mercer admitted it had provided false information to the New York Stock Exchange board about then-Chairman Richard R. Grasso's $187 million pay package.
Some say Greenberg inherited a mess when he took over in 1999. Even so, Greenberg has been criticized for being a hands-off executive, setting steep financial goals for his lieutenants but not bothering to manage how they met them. Some Marsh Mac division heads say this led to a culture that encouraged some managers to take excessive risk and game the system. But of all the players in this spiraling mess, it was clearly Spitzer who administered the coup de grâce.