[JURIST] Leading Friday's corporations and securities law news, the New Hampshire Bureau of Securities Regulation [official website] filed a complaint against AEFA, the personal finance advisory unit of American Express Co. [corporate website], for failing to disclose to investors that its financial advisors were given incentives to push certain mutual funds over better performing funds. The regulators are seeking a fine and restitution of $17.5 million. Read the New Hampshire Bureau of Securities Regulation press release [PDF]. Reuters has more.
In other news...
- Following up on a story reported earlier this week on JURIST's Paper Chase, Artemis, the holding company of French tycoon Francois Pinault [Wikipedia profile], is the sole defendant in a $3.7 billion fraud trial involving the acquisition of failed California insurer Executive Life. This comes after the other remaining defendant MAAF [corporate website in French], walked away from the civil trial, which invoked a default judgment. California authorities will have to go to France to recover any money from MAAF. The original suit claims Credit Lyonnais [corporate website], who settled earlier this week, used MAAF as a front to buy Executive Life when California laws barred foreign governments from controlling insurance companies. Artemis allegedly acquired and profited from Executive Life's lucrative junk bond portfolio in 1995 after Credit Lyonnais sold off all its assets. AFP has more.
- Former Enron [corporate website; JURIST Hot Topic archive] Chairman Ken Lay [Wikipedia profile], who has wanted a speedy trial since his indictment last July, has now joined his co-defendant Rick Causey in asking for a December trial date. This comes in response to US District Judge Sim Lake's request for a date when all of the defendants and their lawyers are free. Read the indictment [PDF] and SEC complaint [PDF]against Lay and Causey. The Houston Chronicle has more and continuing coverage of the Enron scandal.
- The SEC has started a formal investigation into chip maker Sipex Corp. [corporate website] over the company's financial records for 2003 and 2004. The company, which is conducting an internal probe into the matter, will cooperate fully with the investigation. Read the Sipex press release. AP has more.
- The SEC announced Paul Roye, the head of the agency's division that oversees mutual funds, will leave his post. The SEC and Roye have come under intense scrutiny since New York Attorney General Eliot Spitzer [official website] launched his probe of the mutual fund industry. Read the SEC press release. CBSMarketWatch has more.
- Former Qwest Communications International Inc. [corporate website] senior vice president Marc B. Weisberg was indicted on wire fraud and money laundering charges. The twelve-count indictment accuses Weisberg of personally profiting on investment opportunities at the expense of the company and its shareholders. AP has more.
- Qwest Chairman Richard Notebaert [corporate biography] announced the company will make a new bid for MCI [corporate website] after reviewing Verizon's winning bid [Verizon press release]. The bid could lead to a bidding war with Verizon [corporate website] for MCI, the number two long distance telecommunications company. Reuters has more.
- Former Boeing CFO Michael Sears was sentenced to four months in prison and fined $250,000 after pleading guilty [JURIST story] in his role in hiring Darleen Druyun [Wikipedia profile], the former Air Force official who was still involved in Boeing contracts with the Air Force. The St. Louis Business Journal has more.