Posted by Al Lewison May 13, 2011 Courts /
Federal prosecutors racked up their biggest trophy since Enron and Worldcom with guilty verdicts against billionaire hedge-fund managers Raj Rajaratnam earlier this week.
Big as it was, it was not big enough. I talked to a couple of former federal prosecutors to get a sense of why pursing white-collar crime is so difficult. It comes down to a matter of resources. So many financial transgressions, so few investigators with the skills to bring them to court. Particularly in an age where increasing law enforcement resources are going to the war on terrorism.
Posted by Al Lewison May 13, 2011 Economy /
The Great American Fire Sale is on, the Associated Press reports today.
Cash-strapped governments all over the country are dumping property to pay bills.
I love this quote from Jay Powell, a fellow at the Bipartisan Policy Institute: “This is the second worst thing a government can do. The worst thing they can do is run out of money.” Click here to read more from AP.
Most governments are suffering after the recession, falling property values and rising unemployment wiped out tax receipts. As the economy improves – that is to say, if the economy improves – those problems will mitigate themselves.
Federal, state and local governments all have excess inventory they can unload, and it’s probably wise to lighten the load from time to time. But, of course, it’s always better to sell in a strong market.
The fact that they’re selling now shows they’re desperate or not ready to believe the economy is improving.
Posted by Al Lewison May 11, 2011 Courts /
A huge win for U.S. prosecutors in a complicated white-collar case: Jurors today found Galleon Group hedge-fund founder Raj Rajaratnam guilty on all 14 counts of securities fraud and conspiracy in a high-profile insider trading case.
Prosecutors alleged he got insider stock tips from public companies, including Goldman Sachs, and bagging profits and avoiding losses totaling $63.8 million. Rajaratnam argued his trades were based on publicly available information.
“There are rules and there are laws and they apply to everyone,” U.S. Attorney Preet Bharara said in a statement. “No matter how much money you have.”
This marks one of the biggest victories for federal prosecutors since Enron and Worldcom. Typically, insider trading cases are considered difficult to prove, particularly when they’re against defendants who can afford multimillion-dollar defenses.
It likely will embolden Bharara to pursue other cases against other alleged market cheats exposed in this case, and it will empower him to negotiated plea deals.
The big question is how far the onion will be peeled. Rajaratnam was getting tips from a Goldman Sachs director, according to testimony in the case. If trafficking in insider tips goes this high, the next question is how wide?
Bharara has dozens more cases on his pallet. One lead seems to another, and as Bharara said, the rules apply to everyone.
Posted by Al Lewison May 09, 2011 Companies /
CitationAir has invited all of its furloughed pilots back, the Greenwich, Ct.-based company announced today.
In 2009, the company put 85 pilots on furlough as demand for private jet travel slipped amid the recession. So far, 53 have returned, bringing the company’s pilot force up to 334.
“CitationAir has made strides in the past couple of years not only to survive the recession, but to grow the business afterward—a feat of which we’re very proud,” CEO Steve O’Neill said. “In doing so, CitationAir is the only company in the private jet marketplace to have offered a recall to 100 percent of its pilots after a furlough. Our ability to offer a recall to all of our furloughed pilots is just one of many examples of how much we honor our workforce, our company, and the value we’re able to provide our customers.”
CitationAir offers private jet travel through its Jet Card, Jet Access, Jet Shares, Jet Management and Corporate Solutions products. It flies Cessna’s popular Citation aircraft: Citation CJ3, Citation XLS, Citation Sovereign and Citation X. It is owned by Cessna Aircraft Co., a Textron (TXT) company.
Click here to read the column I wrote about CitationAir in March.
Posted by Al Lewison May 08, 2011 For Sale /
The house made famous in the 1990 film, Home Alone, by director John Hughes and then-child actor Macaulay Culkin is on the market for $2.4 million.
Zillow.com gives the house at 671 Lincoln Ave. in Winnetka, Ill., a “zestimate” of considerably less: $1.4 million. Don’t you just hate it when Zillow does that? A cool million in potential valuation gone, at least at Zillow. It’s enough to make you slap both palms against your cheeks like that kid in the movie.
The 4243-square-foot abode, built in 1920, has 5 bedrooms and 3.5 bathrooms.
American millionaires need to do little else but sit back and enjoy compounded investment gains over the next few years, and their millions may more than double by 2020, according to a study by the Deloitte Center for Financial Services and Oxford Economics.
Posted by Al Lewison May 08, 2011 Companies /
Chipotle Mexican Grill remains the target of Immigration and Customs Enforcement for allegedly hiring illegal immigrants.
The Denver-based restaurant chain says it does not knowingly hire people who are not authorized to work in the United States, and abides by applicable hiring laws. But so far it has had to let go about 500 workers for not being able to provide proper paperwork, and ICE is still rifling through its stores.
It’s no secret the restaurant industry runs largely on immigrant labor, but that labor needs to be legal now that the Obama administration has been targeting employers who hire undocumented workers, instead of rounding up the workers and deporting them.