BC-AIG/OHIO-SETTLEMENT (UPDATE 1)

UPDATE 1-AIG to pay $9 mln in Ohio antitrust case

+ Ohio alleged antitrust violations

+ Insurers alleged to provide fake prices to customers

NEW YORK (Reuters) - American International Group Inc will pay $9 million to settle an antitrust lawsuit accusing it of conspiring with other insurance companies to fix commercial casualty insurance prices, Ohio Attorney General Richard Cordray said Wednesday.

The attorney general has alleged that insurers conspired with insurance broker Marsh & McLennan Cos to provide fake price quotations to mislead customers into believing that competitive bidding had resulted in the best prices. He said the alleged illegal activity took place from 2001 to 2004.

"The scam in play here is yet another example of the all-consuming corporate greed that has been so prevalent on Wall Street," Cordray said in a statement.

AIG did not immediately return a call seeking comment. Cordray said the New York-based insurer denied wrongdoing in agreeing to settle the case, which is pending in the Cuyahoga County, Ohio Common Pleas Court.

Last November, Cordray announced a $400 million settlement of a separate class-action lawsuit against Marsh. (Reporting by Clare Baldwin, Paritosh Bansal and Jonathan Stempel, editing by Dave Zimmerman)

REUTERS