This is a partial transcript from "Your World with Neil Cavuto," October 26, 2004, that was edited for clarity.

NEIL CAVUTO, HOST: The new CEO of Marsh & McLennan (search) is one of the few in his industry New York Attorney General Eliot Spitzer (search) seems to like. And for good reason. There was a time when he was Spitzer's boss.

Joining us now is the man trying to clean things up at Marsh, Michael Cherkasky.

Mr. Cherkasky, good to have you. Congratulations.


CAVUTO: Now explain that to me. What were you in regards to Spitzer?

CHERKASKY: I recruited him in the Manhattan D.A.'s office in the later 1980s. And he worked with me for five years.

CAVUTO: Did you think he would be as big as he is?

CHERKASKY: I don't think anyone could estimate where Eliot was going to go but we knew he extremely smart, talented, hardworking. So he had all the criteria to be successful.

CAVUTO: Now, the fact that you were brought up as the new head of Marsh, immediately people said that was meant to calm Eliot Spitzer, to impress him. And that that prevented any criminal charges being pressed against your firm. Is that true?

CHERKASKY: I think that, and doing all the things right that Eliot wanted. I think it didn't make any difference who it was, as long as you had the right plan, the right policies.

CAVUTO: I heard it made a big difference that it was you.

CHERKASKY: Well, you know, Eliot was trained by the same person I was trained by, which is Bob Morgenthau. And Bob Morgenthau would never have allowed us to allow personalities to get that involved in it. Certainly, having a relationship and being someone who I understood what the regulators wanted.

And we came in with an appropriate package, so I think that that's what worked, and not the relationship between me and Eliot.

CAVUTO: Here's what Mr. Spitzer claims is not working in the insurance industry, that a lot of these sweetheart, cushy deals where business is passed along to inside, cushy friends and everyone get a stake and plays in that game and investors don't even know it. How do you stop that?

CHERKASKY: You stop that by complete visibility. And you stop it by...

CAVUTO: You're going to lose money as a result?

CHERKASKY: No, we're not.


CHERKASKY: No. Brokerage businesses for 130 years has been a great business. And we -- we've looked at this business. As long as we do the things that we know how to do and retain our clients and provide the advice and counsel that we know how to do, we're the best in the world at this.  We're going to get fair fee from this value-add. Not only are we not going to lose money, but we're going to be fairly compensated.

CAVUTO: Are you going to fire anybody?

CHERKASKY: We've already fired someone, and we're going to do an investigation that's fair and make sure that people who are culpable and responsible are not going to be in our company.

CAVUTO: All right. Now they could file criminal charges against your former CEO, Greenberg, right? If they were so inclined? Just not against the firm?

CHERKASKY: The agreement now is that they're not going to move forward against the firm.

CAVUTO: But it's possible against him?

CHERKASKY: It's possible against any one of the people who were culpable. There's no immunity.

CAVUTO: But he had no contract at the firm. So it's distinctly possible he doesn't walk away with some sweetheart parachute deal.

CHERKASKY: He had no contract. Now we're negotiating. The board is negotiating with him. What the board finds and the putative deal, we're going to run by Mr. Spitzer.

CAVUTO: All right. Now all the insurance stocks are running up today, AIG included, the Dow component, on the belief that maybe the worst is behind them. A little premature?

CHERKASKY: Well, we have a lot of work to do, but we're looking forward, and we think that it was a good day yesterday. And we're going to have good days in the future. I think we had a really, really rough week, but we've got a lot of work to do.

CAVUTO: All right. Michael Cherkasky, again, congratulations. We wish you well. You have a big undertaking ahead of you.

CHERKASKY: Thank you.

CAVUTO: I think you can probably swing it, though, right? We'll see.

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