An insurance broker at a subsidiary of insurance brokerage giant Marsh & McLennan pleaded guilty yesterday to criminal charges related to fraud and bid-rigging and is expected to cooperate in the broad investigation of industry practices.

Robert Stearns, 40, a senior vice president and Marsh employee for more than 20 years, entered the plea in Manhattan’s State Supreme Court to first-degree scheme to defraud, which is punishable by up to four years in prison.

Stearns admitted that from September 2002 into 2004 he instructed insurance companies to submit noncompetitive bids to obtain business contracts, and he conveyed these bids to Marsh clients under false pretenses.

A felony complaint against Stearns, filed yesterday by state Attorney General Eliot Spitzer, says the noncompetitive bids allowed Marsh to control the market, to protect incumbent carriers when their contracts were up for renewal, and to maximize Marsh’s profits.

This scheme “resulted in a rigged bidding process that defrauded insurance clients,” the complaint stated.

Mr. Spitzer filed a lawsuit against Marsh & McLennan, the nation’s largest insurance brokerage, in October. Mr. Spitzer has accused the New York-based firm of bid-rigging, price-fixing, and demanding incentive fees from insurance companies in exchange for sending more property and casualty insurance business their way.

Stearns is the first Marsh employee to be charged; Marsh is the company’s flagship subsidiary, which operates its risk and insurance services businesses.

As part of his plea deal, Stearns will have to forfeit his state insurance brokerage license, said a Spitzer spokesman, Brad Maione.

Justice James Yates allowed Stearns to remain free without bail and set his next court appearance for April 17.

Stearns’ lawyer, Ann McDonald, said she had no comment.

Marsh & McLennan issued a statement regarding Stearns’ plea, saying, “We are saddened by this development. We have been and will continue to cooperate fully with the office of the attorney general in its investigation.”

“We are committed to resolving the company’s legal issues and to serving our clients with the highest standards of transparency and ethics,” said the New York-based company, which has more than 60,000 employees and had $11.6 billion in 2003 revenues.

A statement issued by Mr. Spitzer’s office said Stearns “is expected to testify in future cases, as are five other insurance company executives who previously entered criminal pleas” to similar charges.

The other five insurance industry executives referred to by Mr. Spitzer include two at American International Group, two from Zurich American Insurance, and one from ACE.

In such cases, the severity of the sentence the defendant eventually gets usually depends on the extent of his cooperation.

Marsh & McLennan ousted its chief executive in October and replaced him with Michael Cherkasky. Mr. Cherkasky, who had already worked for the firm, spent 16 years working in the criminal justice system, some of them as Mr. Spitzer’s supervisor in the Manhattan district attorney’s office.

Shares of Marsh & McLennan fell $1.02, or more than 3 percent, to close at $31.68 Thursday on the New York Stock Exchange.