REGULATORS

Wednesday, December 12, 2007

REGULATORS

SEC to Ask for More Disclosure

The Securities and Exchange Commission is calling on banks and insurance companies to inform investors about possible exposure to potentially troublesome loans and securities tied to riskier borrowers.

The letter will go to companies that have disclosed off-the-books investments in collateralized debt obligations, conduits and structured investment vehicles. While such investments aren't recorded on a company's balance sheet, SEC officials said, information about them could be laid out for investors elsewhere.

LEGAL

Wal-Mart Sex-Bias Case Stands

Wal-Mart lost a bid for a rehearing of an appeals court decision upholding the right of 2 million current and former female workers to proceed as a group with sex-bias claims. The women accused Wal-Mart of paying females less than men and giving them fewer promotions.

Nacchio Seeks Classified Papers

Former Qwest chief Joseph P. Nacchio, convicted of criminal insider trading, asked a judge to allow him to use secret government information in his defense of civil fraud allegations.

Nacchio said the case should be dismissed if the government is allowed to withhold the documents because of state secrets and military privileges. At issue is material detailing Qwest's business dealings with clandestine government agencies.

SEC Alleges Pyramid Scheme

The Securities and Exchange Commission sued two Florida companies and their owner, claiming that they sold language lessons as a front for a pyramid scheme with as many as 70,000 victims in 64 countries.

A federal court froze the assets of Robert Lane and his companies, Wealth Pools International and Recruit for Wealth, which marketed English and Spanish tutorials on DVD, the SEC said.

TECHNOLOGY

New Privacy Option for Ask.com

IAC/InterActiveCorp, the Internet-media company assembled by billionaire Barry Diller, introduced a privacy feature for its Ask.com unit as other Web sites have been criticized over their handling of users' personal information.

AskEraser will allow users to control whether the search engine retains any data about the searcher or their queries, IAC said. Ask.com users who enable the privacy function will not be able use other features that depend on retaining user information.

TV Switch Plan Criticized

U.S. regulators have "no comprehensive plan" for preparing viewers for the approaching switch-over to digital television, a Government Accountability Office study said. The report took issue with the Federal Communications Commission for lacking an overall strategy for the Feb. 17, 2009, switch, which will require broadcasters to change to digital signals from analog.

FCC Chairman Kevin J. Martin responded in a letter to the GAO, saying he had "significant reservations and concerns with the report's approach and conclusions."

The federal government plans to subsidize the cost of buying a digital-analog converter box by offering $40 discount coupons to anyone who owns an analog television. The National Telecommunications and Information Administration announced yesterday that it had certified more than 100 retailers to participate in the converter box program, including Best Buy, Circuit City, RadioShack, Sears, Target and Wal-Mart Stores.

EARNINGS

H&R Block Delays Report

H&R Block, the nation's largest tax-preparation company, delayed its second-quarter earnings to give its new auditors more time. It said it expected a much larger loss than last year as its mortgage business continues to drag it down. A preliminary report said H&R Block expected a net loss of $502.3 million for the quarter ended Oct. 31, compared with a loss of $156.5 million in the corresponding period last year.

LEGISLATION

House for Do-Not-Call Changes

The House voted to make permanent the program protecting people from telemarketing calls, relieving consumers from having to renew their participation in the do-not-call registry.

A second bill passed by the House makes permanent a funding system under which the FTC collects fees from telemarketers to operate the registry. Both bills still need Senate approval.

House Supports Pilot Age Change

U.S. airline pilots' mandatory retirement age would rise to 65 from 60, under legislation approved by the House. The measure has been separated from budget proposals that have been stalled by lawmaker differences.

The Senate also voted to approve age-65 retirement on Sept. 12 as part of a transportation budget bill that since has stalled. The House approval sends the new plan to the Senate for consideration.

CREDIT

IndyMac Rating Cut to Junk

Standard & Poor's said it cut IndyMac Bancorp's credit rating to "junk" status, citing increased risk the struggling mortgage bank will suffer additional losses given the turmoil in the housing and mortgage finance markets. Standard & Poor's reduced the company's rating to non-investment grade "BB+/B" from investment grade "BBB-/A-3" and set its outlook as negative.

EARNINGS

Kroger, the nation's largest traditional grocery chain, said that its profit rose 18 percent, to $253.8 million from $214.7 million in the comparable period a year earlier. Revenue jumped 10 percent to $16.14 billion.

Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.