Continue reading Toyota Accused of Withholding Test Data

Toyota Accused of Withholding Test Data originally appeared on BloggingStocks on Fri, 26 Feb 2010 18:30:00 EST. Please see our terms for use of feeds.

On Wednesday, Galleon Group founder Raj Rajaratnam told employees via letter that the company is going to wind down all of its hedge funds. In a Wall Street Journal article (subscription required), a person familiar with Galleon said that one of the alternatives the company is exploring is selling out to another firm.

These alternatives were approached by Rajaratnam in his letter, as he told employees that it is "in the best interest of our investors and employees to conduct an orderly wind down of Galleon's funds while we explore various alternatives for our business."

Continue reading Galleon to shutter its hedge funds, is anyone surprised?

Galleon to shutter its hedge funds, is anyone surprised? originally appeared on BloggingStocks on Wed, 21 Oct 2009 13:10:00 EST. Please see our terms for use of feeds.

So, here's one for you -- according to Joseph Cotchett (a lawyer for some of Bernie Madoff's victims), Bernie Madoff is surprised that his Ponzi scheme lasted as long as it did. The revelation came during a 4.5 hour interview, wherein Madoff revealed how the scheme worked and how securities regulators didn't catch him. Madoff did apologize, repeatedly, for the harm he caused victims.

The most interesting part of the interview is when Madoff described meetings with the Securities and Exchange Commission (SEC) while he was committing the fraud and how the SEC was unable to catch him, which didn't surprise him. These comments lead Cotchett to theorize that "many people" were negligent, including the government watchdog agencies. Let's not forget that the SEC has seen no evidence of wrongdoing by its staff as far as the Madoff situation is concerned. Nevertheless, the SEC has undergone many changes in order to continue to protect investors and the market.

Continue reading Bernie Madoff expresses surprise at how long his scheme lasted

Bernie Madoff expresses surprise at how long his scheme lasted originally appeared on BloggingStocks on Wed, 29 Jul 2009 11:30:00 EST. Please see our terms for use of feeds.

David Friehling is only the second person to face criminal charges in the Bernard Madoff debacle. He served as Madoff's auditor from 1991 to 2008, though it's hard to say if they'll resume their relationship as cellies. For now, Friehling has only been charged (innocent until proven guilty, and such) with securities fraud, abetting investment adviser fraud and filing false reports with the SEC. On five of the six charges filed, he faces a 20-year maximum.

It's alleged that Friehling didn't conduct "meaningful" audits while in Madoff's employ, despite issuing reports saying that he'd done his job -- which paid close to $15,000 a month (no work for big pay . . . where do I sign up?). In particular, he's said to have not bothered to verify Madoff's business assets, revenue sources or bank accounts. This is no-brainer stuff for an auditor.

Continue reading Madoff bean-counter pleads not guilty

Madoff bean-counter pleads not guilty originally appeared on BloggingStocks on Sun, 19 Jul 2009 16:00:00 EST. Please see our terms for use of feeds.

Continue reading Did the New York Fed Chairman engage in inappropriate behavior with Goldman Sachs?

Did the New York Fed Chairman engage in inappropriate behavior with Goldman Sachs? originally appeared on BloggingStocks on Mon, 04 May 2009 07:00:00 EST. Please see our terms for use of feeds.

It doesn't take much imagination to see that banking could be a bit of a scam on the public. But to keep that scam going it takes big buildings, plush offices, corporate jets, complex product names . . . and a veil of secrecy. Secrecy is important because without it, the mystique is lost. And by mystique, we're sometimes talking about illegal money-making schemes.

That's what Switzerland's premier bank, UBS AG (NYSE: UBS) got caught running. And after forking over $780 million to U.S. authorities, it will have made only a small down payment on paying its penalties to society. How so? UBS is going to turn over the names of its clients to the U.S., which marks the end of a centuries-old franchise for Switzerland -- the inviolate secrecy of the Swiss bank account.

Continue reading Is Swiss banking a criminal enterprise?

Is Swiss banking a criminal enterprise? originally appeared on BloggingStocks on Thu, 19 Feb 2009 09:00:00 EST. Please see our terms for use of feeds.

Continue reading Would Michael Phelps's compromising picture mean less sponsorships?

Would Michael Phelps's compromising picture mean less sponsorships? originally appeared on BloggingStocks on Tue, 03 Feb 2009 19:15:00 EST. Please see our terms for use of feeds.

Continue reading Kroger (KR) issues a beef recall following reports of E. coli

Kroger (KR) issues a beef recall following reports of E. coli originally appeared on BloggingStocks on Thu, 26 Jun 2008 15:50:00 EST. Please see our terms for use of feeds.

Dirty traders scare away hedge fund investors originally appeared on BloggingStocks on Tue, 11 Mar 2008 18:00:00 EST. Please see our terms for use of feeds.

Continue reading What Jerome Kerviel demonstrated, MIT proves

What Jerome Kerviel demonstrated, MIT proves originally appeared on BloggingStocks on Thu, 31 Jan 2008 10:58:00 EST. Please see our terms for use of feeds.

Societe Generale trader Jerome Kerviel may face criminal charges originally appeared on BloggingStocks on Mon, 28 Jan 2008 13:47:00 EST. Please see our terms for use of feeds.

Continue reading Ex-Daewoo chief gets amnesty

Ex-Daewoo chief gets amnesty originally appeared on BloggingStocks on Mon, 31 Dec 2007 12:15:00 EST. Please see our terms for use of feeds.

Could there be any worse fate for an Olympic level athlete than to be stripped of their statistics and medals? Yes, there could be worse things. Just ask former Olympic track star Marion Jones which is worse, losing your medals or being forced to tell your mother you have to sell her house.

Are these professional quality athletes really so stupid as to believe that if they get pinched for using banned performance enhancing drugs they'll get away with just a slap on the wrist? I don't think it's that simple. I'm sure that Marion Jones knew what she was doing was seriously wrong and I feel certain that she knew if she got busted, the truth would come with a very high price. Now, amid all the investigations and scandal, she's finding out just how high priced skirting the truth can really be.

For her misdeeds, Marion Jones has been required to forfeit all five of her medals from the 2000 summer Olympics and has been told to repay approximately $700,000 of her prize money. All of her standings and statistics beginning at September 1, 2000, shall be red-lined in the record books and her medals from other competitions have been taken away also.

Continue reading Money Losers of 2007: Marion Jones is last out of the blocks

Money Losers of 2007: Marion Jones is last out of the blocks originally appeared on BloggingStocks on Fri, 21 Dec 2007 14:10:00 EST. Please see our terms for use of feeds.

As Wal-Mart Stores Inc. (NYSE: WMT) turns to late-night TV to try to boost its image, the Julie Roehm scandal continues to produce negative publicity, regardless of whether Ms. Roehm is telling the truth. A few days ago, Bloomberg reported that the company was facing a lot of pressure to reach a settlement with Roehm, and put an end to the rumors and innuendo.

Last month, Roehm called for the departure of CEO Lee Scott and others she accuses of violating the company's ethics policy. Some worry that a continuation of the battle with Ms. Roehm could lead to more damaging allegations which, regardless of their verity, could further harm the company's reputation.

In retrospect, there's almost no question that Wal-Mart should have settled the suit months ago, when Roehm was seeking approximately $1.5 million in salary and punitive damages. But now that the issue has been grabbing headlines for so long, a settlement could be seen as an admission of wrongdoing, and could generate even more negative publicity.

At this point, Wal-Mart is in a tough position. If Scott and others truly believe they're innocent of any wrongdoing, is it better to let the legal process run its course, regardless of the headlines generated in the interim? Would a settlement put an end to the negative publicity?

The issue really seems to hinge on what else Ms. Roehm has up her sleeve. If accusing Scott of buying a ring from a vendor was all she's got, then they may not want to settle. But if there's more to come in subsequent legal filings, a settlement is probably in the company's best interests.

Should Wal-Mart settle Roehm lawsuit? originally appeared on BloggingStocks on Sun, 03 Jun 2007 10:10:00 EST. Please see our terms for use of feeds.

Backlash building against rich executives originally appeared on BloggingStocks on Wed, 28 Mar 2007 15:15:00 EST. Please see our terms for use of feeds.

CEO scandal? No worries, says Cramer: buy KB Homes originally appeared on BloggingStocks on Mon, 13 Nov 2006 19:40:00 EST. Please see our terms for use of feeds.

Hewlett-Packard Company (NYSE:HPQ) CEO Mark Hurd cannot seem to remember anything about the board leak probe that got the company's previous chairman, Patricia Dunn, in hot water. It's not enough that the poor woman has cancer, Hurd also decided to move out of the way while the bullet hit her.

Perhaps it is time to send Hurd to the dog track with a note pinned on him with his name and address. When he is done watching the hounds chase the mechanical rabbit, they can send him home on the bus.

It appears that almost everyone else at the infamous July 22, 2005 meeting remembers what happened. Hurd was napping.

Apparently, Hurd lectured employees about leaking corporate information to the media. But that must have been a coincidence.

Hurd has more to answer for and there is no guarantee that his job is safe if it is clear that his memory loss was just a convenience.

Douglas McIntyre is a partner at 24/7 Wall St.

HP: Mark Hurd's amnesia originally appeared on BloggingStocks on Thu, 02 Nov 2006 16:00:00 EST. Please see our terms for use of feeds.

The Wall Street Journal reports today that twenty-seven mutual fund companies will be the focus of a new SEC investigation seeking to find out if they accepted millions of dollars in kickbacks from their service companies. This new probe was started after Bisys Group, which provides administrative services to numerous mutual fund companies, settled its kickback case with the SEC. In that case, the SEC said that Bisys paid a total of $230 million in kickbacks between July 1999 and June 2004 to win contracts from mutual funds for its services.

"Receiving a kickback that comes indirectly out of the pockets of shareholders is the functional equivalent of embezzlement," Mercer Bullard, a law professor at the University of Mississippi told the Wall Street Journal. Bullard is the founder and president of Fund Democracy and champion for mutual fund shareholders everywhere. He's led the charge for years to make mutual fund board members more independent, which is the only way scandals like this one can be prevented. In fact according to the Wall Street Journal story today the kickbacks were arranged in side agreements and were hid from mutual fund investors and independent board members.

The Journal story talks about "Advisor A" who allegedly demanded millions of dollars from Bisys in return for a recommendation to the mutual fund board members that the Bisys contract should be renewed. The SEC claims in its complaint the money was used primarily to pay "Advisor A's" marketing costs, but also some of it went to pay for the initiation fee and monthly dues at a country club.

Most of the major mutual fund companies won't be pulled into this scandal because they tend to have their own in-house units to carry out administrative functions. The twenty-seven mutual funds involved in this scandal will primarily be small mutual fund companies, but some banks are expected to get caught up in this probe as well.

Continue reading Are mutual funds taking kickbacks?

Are mutual funds taking kickbacks? originally appeared on BloggingStocks on Thu, 26 Oct 2006 11:30:00 EST. Please see our terms for use of feeds.

Options scandals are becoming almost routine this year. More than 60 companies, most of them flagging tech stocks, have been subject to investigation by the Securities and Exchange Commission. I now gloss over the headlines most of the time. Oh, another one, I think. Figures.

But Apple? Can it be true? Apple is supposed to stand for all that is good in corporate America -- great products, happy customers, cool designs, top-notch service and a capacity to care about more than money-grubbing for pure profits.

Now this. Apple Computer (NASDAQ: AAPL)has announced it will likely have to restate financial results due to its mispricing of stock options. Not only could profits from past years be erased, but investors are likely to sue. One has already emailed us at Blogging Stocks to report that he plans to "sue the living daylights out of them."

The real blow to the stock -- which has climbed $20 in just the past three weeks -- will be to the company's image. I predict the stock will be hurt by more than the pure number-crunching estimates Wall Street comes up with for how earnings per share could be affected.

I think plenty of individual investors, who put their personal faith in Steve Jobs and were willing to overlook the problem after his earnest and straightforward revelations in June, will now feel burned. They may take their profits and run. As the emailer above wrote, "I am furious at the directors and senior officers at Apple for this outrageous disclosure of options."

Apple shares are down just $2.64, and trading at $66.95 as I write this at 9:50 a.m. I think there is likely more pain coming. Stocks are rallying big across the board today on the weak jobs report since it indicates that the Fed may not have to keep raising rates. But Apple's bad news will take some time to sink in and investors will be reminded of it plenty of times in the weeks to come.

Amey Stone is a senior editor at AOL Money & Finance and longtime financial writer in New York . She has no financial interest in Apple.

Say it isn't so, Apple originally appeared on BloggingStocks on Fri, 04 Aug 2006 09:50:00 EST. Please see our terms for use of feeds.