I put a false bid in the system, then hand typed a lower bid.

Using the names of Salomon customers who had not authorized any purchases, he submitted false bids in a number of Treasury auctions.

But just a few months later, the firm faced disaster when regulators charged Salomon with submitting false bids for auctions of Treasury bonds.

Instead, they said, the conspiracy involved vendors agreeing to submit false bids to stifle competition for the food contracts.

The false bid was below the reserve price.

Mr. Stearns, also a managing director, named three other Marsh executives that he said were also working to obtain false bids.

It accused him of having arranged the submission of eight false bids totaling $13.5 billion in seven Treasury bond auctions from 1989 to 1991.

The Federal penalty for false bids was raised to that level several years ago.

Salomon has admitted submitting false bids under customer names without authorization from them.

He had to step in to act as chairman of Salomon after it was rocked by a 1991 scandal involving false bids at Treasury auctions.