State filed a complaint and a Consent Judgment against Boston-based insurance broker William Gallagher Associates Insurance Brokers, Inc. (“WGA”) for billing customers for unauthorized and undisclosed compensation and misleading customers about the brokerage firm’s contingent commission practices and involvement in reinsurance. Contingent commissions, also known as profit sharing commissions, are controversial incentive-based compensation programs offered to brokers by insurance companies. WGA agreed to return $3,017,003 to eleven clients, pay at least $925,000 in sanctions and attorneys fees to the State, and submit to a binding audit of its Energy and Environmental practice group. The Judgment also requires WGA to send statements to over seven hundred customers to correct prior allegedly false representations the company made regarding its employees’ knowledge of contingent commissions and WGA’s participation in reinsurance. Reinsurance is a form of insurance that insurance companies purchase to protect themselves against their policyholders’ claims. Going forward, WGA has agreed to provide enhanced compensation disclosures to customers by providing written notice of all fees and commissions.