Tuesday, May 13, 2003
Qwest's Anschutz could be fined $4M ALBANY, N.Y. — A former Qwest Communications executive could be fined $4 million fine for accepting lucrative initial public offering shares in exchange for giving firms' investment banking business, a source familiar with the investigation said.
The fine against Qwest founder and former chairman Philip Anschutz could be announced as part of a settlement with New York Attorney General Eliot Spitzer as early as this week, according to the source who spoke on the condition of anonymity.
Anschutz attorney, Steve Kauffman of Manhattan, didn't immediately respond to a request for comment left at his office Monday.
In September, Spitzer sued Anschutz and four other executives linked to what he called a multimillion dollar scheme involving IPO "spinning." Spitzer accused the corporate officers of steering underwriting business to a brokerage firm that offered them, personally, access to lucrative IPO shares. The IPO share prices soon soared in active trading and the CEOs then sold them at a profit of millions of dollars without an initial cost under what Spitzer called "illicit transactions."
Hartford Financial to cut 1,500 jobs HARTFORD, Conn. — The Hartford Financial Services Group Inc. announced a major restructuring Monday, saying it will cut 1,500 jobs and is getting out of the business of insuring other insurance companies.
The company made its decision after studying its potential exposure to asbestos claims, Ramani Ayer, chairman and chief executive officer, said in a news conference.
Because of concerns over asbestos liability, Ayer said, the company also announced it is boosting its reserves by $3.91 billion to $5.9 billion, and is taking a $1.7 billion charge in the first quarter.
The company has been a "small player" in the property-casualty reinsurance business and couldn't justify the capital investment required to continue, Ayer said.
The job cuts translate to 850 people being laid off and an additional 650 vacant positions being eliminated, he said. The company employs 29,000.
Most of the layoffs will be in the property-casualty reinsurance division, Ayer said. Others will come from consolidation of corporate services.
US Airways to buy up to 550 new jets ARLINGTON, Va. — US Airways signed deals with two jet-plane manufacturers to buy at least 170 and possibly as many as 550 regional jets from Canada-based Bombardier Aerospace and Brazil-based Embraer.
The deal includes $4.3 billion in firm orders for 85 Bombardier jets and 85 Embraer jets.
The regional jets are a linchpin of US Airways' restructuring plan, replacing unpopular turboprop planes on short routes and more expensive mainline jets on larger routes. The airline says the regional jets will allow it to generate more revenue and compete more effectively.
70% more CEOs fired in 2002 than 2001 NEW YORK — Chief executives were forced out of their jobs last year at record levels all over the world, according to a survey of leadership turnover released Monday.
Management and technology consulting firm Booz Allen Hamilton's survey of the world's 2,500 largest publicly traded companies found that 253 CEOs left their positions last year — a 10 percent rise over 2001. Of those, nearly 100 were forced out of their jobs because of poor performance — a 70 percent increase over the number fired in 2001.
Wall Street to face tougher IPO rules NEW YORK — Wall Street firms face tighter disclosure rules on how they distribute hot initial public offerings under recommendations set to be released soon by a special regulatory committee.
The 14-member joint panel of the New York Stock Exchange and National Association of Securities Dealers, chaired by retired Philip Morris chairman Geoffrey Bible, is expected to issue the proposals as early as this week, according to a person familiar with the committee.
The recommendations include limits on how an IPO price can vary from the last disclosed price, and restrictions preventing so-called "friends and family" of firms issuing the IPO from getting shares.
Banker charged with destruction of evidence NEW YORK — A former technology banker who became an industry star during the dot-com boom was indicted Monday on charges that he directed employees to destroy documents sought by investigators.
Frank Quattrone, 47, who was highly influential at Credit Suisse First Boston during the late 1990s, is accused of approving a December 2000 e-mail that urged CSFB workers to "catch up on file cleaning" for the holidays.
The indictment, handed up in Manhattan federal court, charges Quattrone with obstructing the grand jury and SEC investigations, plus witness tampering — charges that carry penalties of up to 25 years in prison.
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