Marsh's Cherkasky, Mr. Monitor, Failed Up

Top Of The News Marsh's Cherkasky, Mr. Monitor, Failed Up Dan Ackman, 10.26.04, 11:15 AM ET Michael Cherkasky, the new chief executive of Marsh & McLennan, was, until recently, known for five things: He tried John Gotti; he "investigated mobsters," he "participated" in the trial of the 1993 World Trade Center bombers, he was a prosecutor in the BCCI scandal, and he ran for district attorney of Westchester County. Also: he was once Eliot Spitzer's boss.
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How did it all work out? -- A Manhattan jury acquitted Gotti on charges arising from the 1986 shooting of a union leader. He was later convicted, but by federal prosecutors. -- The investigation of mobsters was a mixed bag at best. In 1992, in the middle of a jury trial led by Spitzer, the Manhattan district attorney's office, where Cherkasky led the rackets bureau, accepted a plea from Thomas and Joseph Gambino, sons of the late Carlo Gambino, founder of the Gambino crime family. The deal required the sons to quit the trucking business and to pay a $12 million fine. But there was no criminal conviction and no jail time. Cherkasky, however, did well, as he was later, along with his new company, Kroll Associates, assigned as a court-appointed monitor of the trucking business on Long Island. -- The trial of the 1993 World Trade Center bombers led to several convictions. But it, too, was in federal court, and by the time the jury ruled, Cherkasky had left the district attorney's office, which played a relatively minor role in the investigation. -- In the most celebrated aspect of the BCCI case, Washington lawyer Robert Altman was acquitted in 1993--and in near-record time. This was after a five-month trial that included 45 prosecution witnesses, but zero defense witnesses. Cherkasky was not the lead prosecutor, but he was head of the division that investigated and tried the case. -- Also in 1993, Cherkasky, then just 43 years old, ran for the district attorney's job in Westchester. Logically, he might have run in Manhattan, but Robert Morgenthau (think Adam Schiff on Law & Order, but without the charisma) had long fossilized into the job, which he still holds. Cherkasky lost badly to Jeanine Pirro. After losing the race, Cherkasky, now 54, joined Kroll, the investigations firm, and was quickly elevated. By the time it was bought by Marsh & McLennan (nyse: MMC - news - people ) for $1.9 billion this summer, he was CEO. Yesterday, after Marsh wound up in a series of scandals, the first involving mutual funds, the second involving its core insurance business, he was named CEO of the parent company, the world's largest insurance brokerage firm. That the former prosecutor is friends with, a contributor to and the former boss of the New York attorney general, who is investigating the company, is lost on no one. Indeed, Spitzer seems directly responsible for his friend's elevation, having announced that he could not negotiate with Marsh's existing leadership. Enter Cherkasky, who immediately called to restart the talks with Spitzer. As Cherkasky is a career prosecutor and investigator with little financial services experience, many wonder if he is the right man for the job long term. For now, though, the main job is fixing the company's reputation and getting its legal house in order. In that area, Cherkasky is experienced. In addition to overseeing the trucking industry, Cherkasky has served as a court-appointed federal election monitor of the Teamsters union and as a federal monitor of the Los Angeles Police Department. As for being Spitzer's former boss, that situation has been reversed. Today, Spitzer's the boss.