Tyco Executives Denied Bail
Justice Angela Mazzarelli of the New York Supreme Court's Appellate Division refused to release former Tyco International executives L. Dennis Kozlowski, left, and Mark H. Swartz on bail while they appeal their convictions on charges of stealing some $600 million from the company.
Kozlowski and Swartz were convicted in June on first-degree grand larceny and other charges related to accusations that they stole $170 million outright and improperly made about $430 million by manipulating Tyco's stock value. The two former executives have been detained since Sept. 22 at the Downstate Correctional Facility in Fishkill, N.Y., after each was sentenced by New York Supreme Court Justice Michael J. Obus to 81/3 to 25 years in prison.
Scrushy Seeks Suit Dismissal
HealthSouth founder Richard M. Scrushy asked a federal judge to dismiss a Securities and Exchange Commission civil suit accusing him of the $2.7 billion fraud at the company. Scrushy was found not guilty in June of criminal charges connected with the fraud.
Market-Timing Allegations Settled
Three brokerage firms have agreed to pay a total of $5.8 million to resolve regulators' allegations that they allowed improper trading in mutual funds by favored clients to the detriment of long-term shareholders.
The NASD, the brokerage industry's self-policing organization, announced the separate settlements over allegations of so-called market-timing abuses by First Allied Securities, ING Funds Distributors and Janney Montgomery Scott. The firms neither admitted nor denied wrongdoing under the agreements.
Yellow Pages Publisher Expands
Yellow pages publisher R.H. Donnelley said it has agreed to buy a larger counterpart, Dex Media, for $4.2 billion, creating the third-largest yellow pages company in the country. The combined company would publish more than 600 directories in 28 states, with a total circulation of 73 million.
Calif. Settles Disability Probe
California insurance regulators settled a three-year probe of UnumProvident, ordering the nation's largest disability insurer to pay an $8 million fine, reconsider thousands of claims and change the way it handles future claims. The settlement with the Chattanooga, Tenn.-based insurer follows a review of 1,000 claims by policyholders in the state, which led the California Department of Insurance to find the company was "systematically" finding ways to get out of paying disability claims.
SEC Fraud Payouts Called Low
Defrauded investors have received only about 1 percent of the billions of dollars collected for them by securities regulators since 2000, the Government Accountability Office said in a new report. It found that the Securities and Exchange Commission has taken in more than $4.8 billion in civil fines and restitution in settlements with companies and individuals during that period but has distributed only about $60 million to the entitled shareholders from three of the 75 cases in question, the report found.
T-bill rates rose. The discount rate on three-month Treasury bills auctioned yesterday increased to 3.525 percent from 3.44 percent last week. Rates on six-month bills rose to 3.87 percent from 3.745 percent. The annualized return to investors is 3.606 percent for three-month bills, with a $10,000 bill selling for $9,910.90, and 4.002 percent for a six-month bill selling for $9,804.35. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, rose to 3.97 percent last week from 3.88 percent the previous week.
Compiled from staff and news service reports.