Munich Re, Converium Receive U.S. Subpoenas

Munich Re, the world’s largest reinsurer, and Swiss reinsurer Converium have received subpoenas from the Securities Exchange Commission and New York State Attorney General Eliot Spitzer as part of the ongoing investigation into accounting practices at US bond insurer MBIA.

The investigations are also examining the use of finite reinsurance in relation to accounting statements. (See previous articles).

Although the two companies have confirmed receipt of the subpoenas, and although neither has as yet made any official comment concerning them, both have indicated that they will cooperate in the investigation.

Investigators have also issued subpoenas to France’s AXA in connection with the investigation. Spitzer and the SEC are looking into the relationship between the three companies as reinsurers of MBIA in 1998 when Allegheny Health, Education and Research Foundation, which MBIA insured, collapsed.