Adelphia Communications regularly hid a list of fraudulent financial data from its auditors, said former vice president James R. Brown, the government's star witness in the fraud trial of founder John J. Rigas. Brown, who pleaded guilty to fraud and conspiracy charges, said that executives at the cable television operator feared telling the truth to its former auditors, Deloitte & Touche. "We regularly prepared a schedule we referred to as 'exposure items' that if Deloitte came across them, we wouldn't be able to defend," Brown, 42, told federal jurors in New York during his 12th day of testimony against John Rigas, 79, and his sons Michael, 50, and Timothy, 47.
SEC Looking at Pay Disclosures
The Securities and Exchange Commission may force companies to divulge more information about executive compensation, Alan L. Beller, director of the SEC's Division of Corporation Finance, said in a speech in Alexandria. Beller said changes in executive pay, including stock-based compensation, have outpaced SEC rules but he declined to specify how those rules might change. Investor groups have complained that companies hide excessive compensation within packages that are only vaguely described in SEC filings.
The Composite Index of Leading Economic Indicators, the Conference Board's closely watched indicator of future economic activity, edged up in April, providing more evidence of a sustained recovery. It rose 0.1 percent in April, after a revised gain of 0.8 percent the previous month. The increase was slightly lower than the 0.2 percent rise forecast by analysts.
Microsoft was ordered by a federal judge to search a company computer to help explain why James E. Allchin, who runs the company's flagship Windows business, told employees in 2000 not to save e-mails for more than 30 days "due to legal issues." U.S. District Judge J. Frederick Motz in Baltimore issued the order in an antitrust and patent suit by Burst.com, which has accused Microsoft of stealing its technology for broadcasting sound and video over the Internet at high speeds. Burst.com charges that Microsoft destroyed e-mail that may help prove its case. Motz said he didn't believe Microsoft's explanation that its information technology department inserted the words in the company policy statement to make it easier to persuade employees to delete e-mails after 30 days to save memory space.
The House approved an amendment to a defense spending bill that requires the Air Force to complete by March 1 negotiations to purchase 80 Boeing 767 planes for use as refueling tankers. The Air Force also plans to lease 20 planes from Boeing in the $23.5 billion deal, which is stalled amid a criminal probe into the deal and a series of Pentagon reviews. But a spokesman for a watchdog group that has criticized the tanker deal said the House action would accomplish little because the amendment is almost certain to be defeated in the Senate.
Yum Brands offered at its annual meeting to help a group of Florida farmworkers push for better wages and working conditions if it agreed to end its three-year boycott of the company's Taco Bell chain. The Coalition of Immokalee Workers has been trying to prod Yum into using its leverage with farm owners by paying a penny more per pound for tomatoes and other vegetables.
A former Dynegy executive surrendered at a low-security federal prison in Texas to begin serving a sentence of more than 24 years. Jamie Olis was convicted of conspiracy and five counts of securities, wire and mail fraud last year for helping push through a 2001 scheme to disguise a loan as cash flow.
McDonald's new chief executive, Charles H. Bell, assured shareholders at the company's annual meeting that his battle with colorectal cancer has not hurt operations and said that the revitalization plan introduced last year continues to boost patronage and profit. McDonald's is serving about 2 million more people daily at its nearly 30,000 restaurants worldwide and sales at outlets open at least a year have increased 9.4 percent in the first quarter, Bell said.
American Express was censured by NASD and fined $300,000 for poor recordkeeping in variable annuity transactions. NASD, formerly known as the National Association of Securities Dealers, said it discovered inadequacies as a result of an investigation into unauthorized withdrawals from a customer's variable annuity account.
Tellabs, a telecommunications equipment company, said it agreed to buy telecom supplier AFC for $1.9 billion in cash and stock because of a desire to acquire a broadband provider.
Rates on 30-year mortgages took a dip this week, falling to 6.30 percent from 6.34 percent last week, according to Freddie Mac. Last week's performance had marked the eighth week in a row that rates on 30-year mortgages had gone up after hitting a low for the year of 5.38 percent the week of March 18.
Three former top executives of Enterasys Networks pleaded not guilty and another former officer pleaded guilty in a fraud that federal prosecutors allege cost investors $1.3 billion. Former assistant controller Anthony Hurley, 34, of Georgetown, Mass., pleaded guilty in a closed hearing in U.S. District Court to one count of wire fraud in the alleged conspiracy. He faces up to five years in prison and a fine of $250,000. Prosecutors said the defendants conspired to inflate reported revenue to bolster the value of Enterasys stock and to further their careers.
Rio Grande Food Products of Beltsville is recalling some of its cheese products after salmonella, a germ that can cause food poisoning, was discovered in a shipment from Central America. The recalled cheese was sold in 10 states and the District from February to April in blocks of 40 to 85 pounds under the brand name Rio Grande and UPC code 738529070123. It was also repackaged in smaller consumer-size blocks under the brands Rio Grande-Queso Duro Viejo/Hard Cheese, UPC 738529070128; Queso Duro Viejo/Aged Hard Cheese, UPC 769087000678; and Emanuel Distributors, Product of El Salvador, which may lack a UPC code.
Air Canada won wage concessions from the Canadian Auto Workers union, which had been holding up a $618 million ($850 million Canadian) financing agreement needed to help the company exit bankruptcy. Deutsche Bank had threatened to withdraw the financing unless all of the airline's nine labor groups agreed to yield $200 million (Canadian) more in savings so it could meet a $1.1 billion cost-cut target.
China accused its trading partners of trying to shut out Chinese exports and investment in a report that focused mostly on the United States. The Ministry of Commerce report said other governments were using technical requirements, quarantine and quality inspections, customs procedures, labor standards and intellectual property rights as trade barriers.
Edward L. Yingling, the longtime lead lobbyist for the American Bankers Association, will become president and chief executive of the organization next year, succeeding Donald G. Ogilvie, 62, who will retire.
Gap reported a 54 percent increase in first-quarter earnings, to $312 million, continuing the San Francisco-based clothing retailer's rebound from a sales slump.
Hormel said profit rose 59 percent in the second quarter, to $53.7 million, in part because of higher turkey prices.
Nordstrom's first-quarter earnings more than doubled, to $68.7 million, after sales at stores open at least a year rose 13 percent, their biggest gain in more than a decade. .
Petsmart said first-quarter earnings jumped 45.6 percent, to $35.8 million. Demand for grooming and other pet services helped revenue rise 14.5 percent, the fastest pace in more than two years.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.