Former ARIMA President Bruce Ferguson, who is Group Risk Manager at Sydney Water, has stood down from the position as police and anti-corruption authorities investigate an alleged $6.6 million insurance fraud. Mr Ferguson went on leave from his position more than two months ago.

Media reports say an internal audit revealed irregularities in the repayment of broking commissions. For three years before March 2004, $6.6 million had allegedly been wrongfully withheld from Sydney Water.

The NSW Government has confirmed that all government contracts with insurance broker Heath Lambert Australia and its parent company Marsh are under review. Marsh only bought the Australia, New Zealand and Papua New Guinea operations of Heath Lambert in March.

Police and the Independent Commission Against Corruption are investigating. It is also understood that Martin Colebrook, the Heath Lambert account director responsible for the Sydney Water account, has also stood aside during the review.

Before being replaced last month by Jardine Lloyd Thompson, Heath Lambert was placing more than $2.5 billion of cover for the Federal Government.