A Milwaukee bank has filed suit in federal court against Marsh& McLennan Companies claiming that its brokerage subsidiaryMarsh steered its insurance business in exchange for hiddenfees.

The suit, filed Dec. 16 in the U.S. District Court in Milwaukeeby Marshall & Ilsley Corp., charges that Marsh violated itsfiduciary responsibility by accepting commission fees in return forthe placement of insurance with certain companies. M&I said itwas unaware of the commission practice.

The company also asserts that Marsh benefited from the paymentof premiums to it directly, instead of the carrier, by placing themoney in a unit where it earned interest for the firm beforepayment was made to the insurer.

M&I claims the amount would exceed $75,000 and is seekingreturn of brokerage fees, monies paid to the firm in the form ofkickbacks or other hidden consideration or profits, prejudgmentinterests, costs and attorney's fees, and punitive damages. Thesuit does not set a dollar amount for the recovery M&I isseeking.

The action by Marshall & Ilsley Corporation followssettlement of a civil suit against MMC brought by New York AttorneyGeneral Eliot Spitzer alleging that Marsh executives engaged inkickback and placement schemes with insurers in exchange forlucrative contingent commission fees.

In October, MMC announced that half of its clients had opted totake part in an $850 million settlement providing restitution forimproper contingency fee charges. The company said that themajority of its largest clients opted-in to the plan.

M&I alleges that New York-based Marsh failed to look out forthe best interests of the bank by obtaining "the lowest possibleprice" for insurance after agreeing "that Marsh would act solely inthe best interest of M&I in procuring its policies."

It also said it paid Marsh brokerage fees to perform thisservice.

M&I is a diversified banking institution founded in 1847.The bank has $47 billion in assets with 195 offices throughout thestate and locations in Arizona, Minnesota, Nevada, Florida,Missouri and Illinois.

A representative from M&I did not return a call forcomment.

A spokesman for Marsh said the company does not comment onongoing litigation.