OfficeMax said chief executive Christopher C. Milliken resigned after an internal probe into its accounting found that the company fabricated $3.3 million in rebates billed to suppliers. Six workers were fired based on information from the investigation, OfficeMax said. The office-supplies retailer also said it will restate its earnings for the first three quarters of 2004. The company expects to finish its investigation in the next week and report full results for the fourth quarter on March 14.
Housing Crunch Blamed on Regulation
Excessive regulation and not-in-my-back-yard thinking deserve much of the blame for the nation's shortage of affordable homes, federal officials said. In an updated version of a 1991 report, the Department of Housing and Urban Development said over-regulation on the local, state and federal levels raises the cost of housing by as much as 35 percent. The National Association of Home Builders and nonprofit builder Habitat for Humanity endorsed HUD's call for changes, research and increased awareness. But some housing advocates questioned the focus on reducing regulations. A bigger problem, they said, is the administration's proposed $3 billion in budget cuts at HUD and the proposed transfer of HUD's Community Development Block Grant program to the Commerce Department.
A Volkswagen Passat is lifted in the delivery tower of a Volkswagen plant at Wolfsburg in northern Germany. Volkswagen profit fell 31 percent in fiscal 2004, to $838 million, as the automaker contended with the weak U.S. dollar and slow consumer spending in Germany. Sales rose 4.9 percent, to $110.6 billion.
(Fabian Bimmer -- AP)
Wal-Mart Stores has been fined $135,540 for violating child labor laws in Connecticut, Arkansas and New Hampshire, the Department of Labor said. The Bentonville, Ark., retailer entered into an agreement Jan. 11 with the Labor Department giving it 30 days to pay the fine. The department said 85 minors were found to be operating dangerous equipment such as forklifts and scrap paper balers. Rep. George Miller (D-Calif.) requested an investigation into the agreement, saying the Labor Department will allow Wal-Mart 15 days to investigate and rectify employee complaints before the department investigates.
Home Depot is working with four national Hispanic organizations to recruit Spanish-speaking employees. The move -- like the company's previous outreach to senior citizen and military groups -- could help Home Depot tap a valuable customer niche.
American International Group received subpoenas from New York Attorney General Eliot L. Spitzer and the Securities and Exchange Commission seeking information on policies that may help companies smooth their earnings. The requests also asked for information on AIG's accounting of certain policies it sold to other insurers, the company said.
General Electric's InVision unit, the biggest U.S. maker of bomb-detection equipment, will pay $1.12 million to settle Securities and Exchange Commission allegations that it made illegal payments to foreign officials before GE bought it in December. The agreement follows a similar $800,000 settlement with the Justice Department.
T-bill rates rose. The discount rate on three-month Treasury bills auctioned yesterday rose to 2.54 percent from 2.48 percent last week. Rates on six-month bills rose to 2.76 percent, up from 2.71 percent. The actual return to investors is 2.592 percent for three-month bills, with a $10,000 bill selling for $9,935.79, and 2.838 percent for a six-month bill selling for $9,860.47. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for changing adjustable-rate mortgages, rose to 2.96 percent from 2.95 percent last week.
The U.S. Postal Service said it suspended shipments on American Airlines and US Airways because the mail consistently arrived late at its destinations. A spokesman would not give the dollar value for the contracts. American Airlines executives said they met with Postal Service officials yesterday to present a "detailed recovery plan," and US Airways said it was scheduled to meet with the agency today.
The nation's largest pension fund came out in support of a proposed federal rule barring accounting firms from selling tax services to the executives of audit clients. A spokesman for the California Public Employees' Retirement System, known as Calpers, said the rule is "focused on the most abusive practices in the audit industry." The proposed rule by the Public Company Accounting Oversight Board would also ban the marketing of "aggressive" tax shelters to audit clients.
Movie Gallery cleared an antitrust review in its bid to acquire larger rival Hollywood Entertainment, which is also the target of a takeover bid from industry leader Blockbuster. The nation's third-largest movie rental chain passed the waiting period without objections from regulators.
Nokia said it reached a long-term agreement to ensure compatibility between its handsets and computers that use Microsoft's Windows XP operating system. The deal will allow consumers to search, listen, download and buy music through an application on their cell phones, the Finnish cell phone maker said.
ATA Airlines, in bankruptcy reorganization, could save $12 million in the next four months as a result of concessions by its flight crew members. The Air Line Pilots Association said 78 percent of the union's 968 ATA pilots and flight engineers voted for the agreement.
Boeing is unveiling the world's longest-range commercial aircraft, part of its strategy to gain market share by offering fuel-efficient jets to fly more point-to-point routes. Capable of flying 10,843 miles nonstop, the 777-200LR will be marketed to airlines seeking to fly less-traveled routes, such as New York to Singapore.
College savings plans sponsored by states had in increase in assets of 49 percent in 2004, to $52.3 billion, as investors guarded against rising tuition. The 529 plans -- named for a section of the tax code -- allow investors to put away money for college and later withdraw it tax-free for qualified educational expenses.
Another former Enron executive has said he cannot be ready for trial for several months. Daniel M. Petrocelli, lead trial lawyer for former chief executive Jeffrey K. Skilling, said in a court filing that September was the "very earliest" he could be ready for the fraud and conspiracy trial. Reid H. Weingarten, lead lawyer for former top Enron accountant Richard A. Causey, had proposed a Dec. 1 trial. Former chairman Kenneth L. Lay has said he wants to go to trial as soon as possible, and prosecutors have requested a September trial.
A former Duke Energy trader pleaded guilty to federal charges that he simultaneously bought and sold shares in the company through different brokers, an illegal practice known as wash trading. The practice artificially inflated trading volume and helped falsify the company's books in November 2001, prosecutors said. The trader, Brian Lavielle, worked in Duke's trading office in Houston.
The French treasury rebuked Citigroup for a controversial bond trade on Aug. 2, saying it had tarnished European markets. The treasury said it lowered Citigroup's ranking on a list that European treasuries use to decide which banks receive lucrative bond syndication and derivatives trading business. Several European regulators are investigating Citigroup's rapid-fire sale of $16 billion in bonds on a range of electronic trading platforms. It bought back $4.9 billion in bonds a half-hour later.
US Airways Group and General Electric agreed to delay filing the airline's reorganization plan with the U.S. bankruptcy court. Two GE units, Capital Aviation Services and Engine Services, agreed to extend the deadline from Feb. 15 to March 15. The court has given Arlington-based US Airways until the end of March to submit a plan.
Lockheed Martin won a $61 million Navy contract to continue providing engineering, technical services and materials for upgrades to submarine sonar systems. The contract supports the Acoustic Rapid Commercial Off-the-Shelf Insertion program, which improves processing of data from sensors.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.