BUSINESS BRIEFS
SEC shuts down Stanford firms
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NEW YORK — The federal government shut down R. Allen Stanford's investment businesses yesterday.
Two months after Bernard Madoff was accused of running the largest investment fraud in history, Securities and Exchange Commission officials raided the offices of Stanford, a Texas billionaire, and froze the assets of three companies he controls, saying he perpetrated an $8 billion investment fraud.
Stanford was accused in civil charges of lying about the safety of investments he sold as "certificates of deposit" and promised unrealistically high rates of return. Regulators also said he faked historical data about other investments which he then used to lure in more investors for the CD products.
WAL-MART SEEING RISE IN CUSTOMERS
NEW YORK — Wal-Mart Stores Inc. said it's still pulling shoppers away from its main rivals and enjoying a rise in customer traffic as the world's largest retailer released better-than-expected fourth-quarter earnings yesterday.Shares of Wal-Mart rose nearly 4 percent while the Dow Jones Industrials dropped more than 3 percent as investors grew more wary about the government's stimulus plan.
Still, Wal-Mart is hardly immune from economic pressures. It issued a cautious earnings outlook as it feels the pinch from the stronger dollar in its important overseas business, a trend officials said could hurt profits over the next three quarters.
BANKS IN BAILOUT REDUCED LENDING
WASHINGTON — The 20 largest banks that received government rescue funds slightly reduced their lending to consumers and businesses in the last three months of 2008, the government said yesterday.The Treasury Department said the banks reduced their mortgage and business loans by a median of 1 percent each, while credit card lending rose by a median of 2 percent. The median is the point halfway between the banks that lended the most and those that lended the least.
The department's report is the latest sign that the bailout has done little to increase bank lending. A quarterly survey by the Federal Reserve earlier this month found that nearly 60 percent of banks said they had tightened lending standards on credit card and other consumer loans in the previous three months.
Many lawmakers have blasted the banks for not lending more in the wake of the $700 billion financial rescue program approved by Congress last October.
LENDER MAY HAVE SAVED SIRIUS RADIO
NEW YORK — Facing a likely bankruptcy, Sirius XM Radio Inc. found a savior in Liberty Media Corp., which will lend $530 million to the satellite radio provider and block a bid for control that had been waged by a rival both companies share: Dish Network Corp.Sirius had warned it could file for bankruptcy as early as yesterday if it could not successfully negotiate with its debt holders.
Sirius XM Radio has 20 million subscribers who use the service to listen to sports, music and talk, including Howard Stern's show, which Sirius landed with a five-year, $500 million contract that could have been terminated in a bankruptcy.
The company found itself on the brink as credit markets dried up and auto sales plunged — a critical factor for Sirius because many new subscribers buy the service in package offers with cars and trucks.
