Enron: Citigroup, JP Morgan go for settlement
New York: Citigroup and JP Morgan Chase & Co paid more than $300 million to settle charges that they helped Enron cheat investors out of billions of dollars. The settlement with the US Securities and Exchange Commission and Manhattan District Attorney Robert Morgenthau ends an 18-month investigation and lets the two largest US banks avoid criminal prosecution for securities fraud, reports said.

The probe found that Citigroup and JP Morgan Chase structured complex deals that allowed energy trader Enron to hide debt and inflate its cash flow before it filed for bankruptcy protection in late 2001."No more phony baloney," Morgenthau said in announcing the settlement, while warning that companies and banks must make complicated deals more transparent or risk raising "a red flag" for authorities.
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AT&T to submit fresh evidence on Worldcom
NewYork: AT&T Corp plans to submit fresh evidence in support of allegations WorldCom Inc diverted to Canada phone calls placed by US government agencies in order to dodge hefty fees, an AT&T source was quoted as saying. The filing, to be submitted in a Manhattan bankruptcy court, claims WorldCom, which plans to change its name to MCI, had diverted some long-distance phone calls to Canada in a scheme that passed off charges it would normally pay to competitors, including AT&T.
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Enron examiner says banks may lose $5-billion claims
New York: Six investment banks risk losing their claim on more than $5 billion owed by Enron because they helped the energy trader cheat investors, a court examiner said in a report filed on Monday. The examiner, Neal Batson, issued his report on the same day two of the banks, Citigroup and J P Morgan Chase & Co., paid more than $300 million to settle charges they helped Enron hide debt and inflate cash flow. Enron sought bankruptcy protection in December 2001.

Batson said there is evidence to conclude that the six banks -- which also include Barclays Bank Plc, Canadian Imperial Bank of Commerce, Deutsche Bank AG and Merrill Lynch & Co. -- knew of "wrongful conduct" related to Enron's transactions, and "aided and abetted" Enron officers in breaching their fiduciary duties. This, he said, might lead a court "to determine that the claims of such financial institutions, totaling in excess of $5 billion, may be equitably subordinated to the claims of other creditors."
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Xerox profits falls
New York: Xerox Corp posted slightly lower quarterly profit but said improving equipment sales helped the results top most expectations. Stamford, Connecticut-based Xerox said net income was $86 million, or 9 cents a share, down from $87 million, or 11 cents per share, a year earlier. Earnings after payment of preferred dividends were 75 million. The earnings include a charge of 5 cents a share for fees related to a terminated credit facility. Before the charge, profit was 14 cents a share, Xerox said.
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