Wednesday, October 05, 2005

Financial crimes and misdemeanors in the news

WASHINGTON -- House Majority Leader Tom DeLay was indicted by a Texas grand jury for campaign-finance violations, shaking the capital's Republican leadership and aggravating fissures within the party that could unsettle its decade-long dominance of Congress. (WSJ)

HCA Inc. said Thursday it has been informed that the Securities and Exchange Commission has issued a formal order of investigation relating to trading of the company's securities. The announcement relates to the SEC's probe of stock sales made by Senate Majority Leader Bill Frist, whose family founded the company.(WSJ)

September 29, 2005 -- Twelve top investment banks and financial institutions have been told they must defend a lawsuit claiming they participated in an industrywide scheme to rig initial public offerings. (NY POST)

September 29, 2005 -- The accounting disaster at Fannie Mae, the giant mortgage guarantor already in the midst of a multiyear investigation of financial shenanigans, appears to be much worse than previously thought. Investigators now say that the $11 billion estimate of Fannie Mae's accounting gimmicks appears to be a best-case scenario. (NY POST)

The two men who founded Bayou Management LLC, the Connecticut hedge-fund firm that allegedly exaggerated results for years before closing shop unexpectedly in July without returning investors' money, are expected plead guilty to criminal fraud charges in federal court today, a person familiar with the matter said. (WSJ)

The relisting of Parmalat stock will cap the turnaround of the Italian company by government-appointed administrator Enrico Bondi. He took control of the company -- best known for producing milk with a long shelf life -- when it filed for bankruptcy protection in December 2003 after the discovery of a decade-long fraud allegedly masterminded by former executives. (WSJ)

WASHINGTON -- The money that led to the indictment this week of two Las Vegas pastors and the wife of one of them came from federal grants arranged by Sen. Harry Reid in September 2001, a Reid spokeswoman said Wednesday.
( http://www.reviewjournal.com)

A detailed lawsuit filed against Delphi Corp. by two state pension funds and one of Europe's biggest employee-pension funds alleges the auto-supplier's senior executives encouraged inventory deals with a bank and two other companies that artificially boosted profits from 1999 to 2002. (WSJ)

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