One of two AIG executives to plead guilty last week to criminal fraud charges in connection with New York Attorney General Eliot Spitzer?s probe of the insurance industry is understood to have previously worked in Bermuda for both Starr Excess and XL Capital. Hours before Mr. Spitzer stepped up his months-long probe of the insurance industry with the announcement of a lawsuit against leading broker, Marsh & McLennan ? a suit that also named AIG, ACE and other insurers as participating in bid rigging schemes ? 42-year old Karen Radke is understood to have pleaded guilty to one count of scheme to defraud along with a second AIG manager Jean-Baptist Tataeossian.

Meanwhile, a US-based ACE executive, Patricia Abrams, later pleaded guilty in connection with the matter, in her case to a criminal charge of attempted restraint of trade and competition. A letter sent out to all ACE employees late on Sunday night by president and CEO Evan Greenberg said that Abrams had been ?suspended and placed on paid leave?.

Meanwhile, on Friday AIG boss Maurice (Hank) Greenberg, said on a conference call with investment analysts that Radke and Tataeossian ?have been put on leave. They are the only ones (from the company) on leave at this moment.?

Radke was reportedly a senior vice-president in AIG?s excess casualty business, after joining the company from Star Excess.

She joined Starr Excess Liability Insurance International Ltd. in late 1998 as an assistant vice-president of underwriting.

She had previously worked as an underwriter of excess liability business at XL Insurance Co. for two years, having joined XL from General Reinsurance Co. where she was a casualty reinsurance underwriter.

Starr Excess ? which was set up in 1993 as a joint venture between General Re Corporation and AIG ? later saw AIG become the majority shareholder after a large buy-out in 1998.

Both Radke and Tataeossian are said to be cooperating with Mr. Spitzer?s investigation and are expected to testify at a later date, according to international news reports.

AIG could not yesterday confirm employment details for Radke or Tataeossian with a spokesman telling that the company policy was not to comment on employment matters, except to say that both were on leave.

Radke is understood to be the former wife of Bermuda-based PXRe president and CEO Jeffrey Radke.

Radke and Tataeossian?s sentencing is scheduled for December 10, according to Dow Jones.