Elliot Lane explains the main points from the report into alleged bid-rigging at March UK

Freshfield's exoneration of Marsh UK was met with a sigh of relief at its headquarters in the shadow of Tower Bridge. The most severe charge levelled against the broker, namely bid-rigging, was dismissed by the independent inquiry.It said that at no time was a Marsh client "offered less favourable terms" under its market service agreements (MSA).Marsh UK chief executive Bruce Carnegie-Brown said he was "satisfied" with the review and felt that in the time allotted, Freshfields had offered the company a fresh start."The methodology was its [Freshfields] own and had been tried and tested on other clients. It had access to all communication channels, and looked at emails, looked at processes and spoke to people in the market. It could find no evidence of bid-rigging and I don't think anyone in the market has seen it," said Carnegie-Brown.But the report was not without its criticisms. Freshfields offered disclaimers throughout the executive summary that it had a "limited sample basis" and the inquiry was not "an audit". What it did find was pressure being applied to junior brokers from senior management.The report said: "We have seen a number of instances where senior employees have sought to impose pressure on brokers to show business or not to a particular underwriter, because of the position in relation to an MSA."We have found no general systems in place to detect and discourage any improper pressure applied internally."Carnegie-Brown admits that these issues, particularly over controls, must be addressed. "As of the 15 October, we now don't use MSAs. At all. That was our first reaction to any allegations of influence, and now that there are no MSAs in Marsh, senior employees will not be able to apply pressure. But I don't see any reason to make any more dismissals. We will take on the criticisms and re-model our new business plan accordingly."The report was immediately passed to the FSA and Carnegie-Brown will face the regulator this week. He is aware that the controls and corporate governance issues will be top of the agenda."I imagine it will want to see change, and there will be change."In January, Marsh UK will rise again, not so much from the ashes, but at least come off the back foot and be progressive. "I will announce in January that Marsh UK is more client focused and will listen to clients and their needs; we are totally committed transparency and fees will be agreed up front with clients; and we will be looking at revising the London market operation to see whether we can bring the administrative costs in house."Biba chief executive Eric Galbraith said of the report: "This was an independent review carried out properly and confirms that the industry does not need any more regulation." IT

What Freshfield's report into Marsh saidMarket service agreements (MSA) gave rise to a potential conflict of interest between the client and brokers, the Freshfields report said. The investigation found no evidence of bid-rigging, but said there was a risk that MSAs could influence how brokers placed business. The report said safeguards had been installed to protect clients from this influence, but the process had not been completed and the risk of influence was not eliminated. Despite this, the report said, clients were treated fairly by the company. The influence of MSAs would need to be examined by Marsh on an individual basis, it said, but there was evidence that "information was provided" to clients about the practice. The report also said MSAs were a "significant source of income" to Marsh, but brokers were not influenced by the practice.Freshfields reported that Marsh had acted in the "interest of clients and to place businesses with underwriters who were selected to serve the clients best interests having regard to the price, the scope of cover; financial security and service".During the course of the internal investigation, brokers denied the influence of MSAs and said business was also placed with underwriters who had no agreement with Marsh. The report said the client was the first priority.But, it said, although brokers were encouraged to place business with underwriters who had an MSA with Marsh. It "by no means follows that clients were prejudiced or disadvantaged as a result".

Fact file:Around 50 Freshfields lawyers were seconded to the inquiry. They put 50,000 man-hours into the report, interviewing employees, underwriters, trade associations and the market. Over 100,000 documents were read.