To settle alleged conflict of interest, a Wachovia Corp. unit agreed to pay states $25 million, including $482,000 to Massachusetts. Regulators, including Massachusetts Secretary of State William F. Galvin, said divisions of the Charlotte, N.C., company failed to supervise possible conflicts between its analysts and investment bankers, such as allowing analysts to participate in presentations with potential investment banking clients. Wachovia neither admitted nor denied the allegations under terms of the settlement. The company said it is ``pleased to have resolved this situation" and that it had already put in place industry reforms meant to address similar issues. (Ross Kerber)
Mass. business confidence drops to lowest in 2 years
Business confidence in Massachusetts fell to its lowest level in more than two years last month, hit by turmoil in financial markets and concerns about the US economy, Associated Industries of Massachusetts reported. AIM's business confidence index slid to 53.2 in June, down 4.3 points from May and 3.8 points from a year ago. Readings over 50 are considered optimistic. National economic conditions weighed heavily on businesses, with the sub-index measuring the US outlook plunging 9.5 points to 49.2 -- the first pessimistic reading since 2003. AIM officials noted the survey coincided with a pickup in inflation, rising interest rates, and a stock market sell-off. Massachusetts employers were less gloomy about the state economy, with that sub-index slipping 3.6 points to 50. On a positive note, 22 percent of employers expect to hire more workers, compared to 7 percent who expect to cut payrolls. (Robert Gavin)
Commission to evaluate some medical services
The Massachusetts markets for magnetic resonance imaging, outpatient surgeries, and some other medical services delivered outside hospitals will be studied by a special commission under terms of a compromise worked out between House and Senate budget negotiators. The special commission, if included in the final budget as expected, will have 16 members and include officials from Governor Mitt Romney's administration, the Senate, the House, as well as representatives of business and interest groups. The commission will be required to make recommendations for legislative changes by July 2007. (Christopher Rowland)
Hub investment banking firm accused of theft
A Boston investment banking firm is accused of stealing $2.5 million from clients by the Securities and Exchange Commission. The commission initiated cease-and-desist proceedings against Veritas Financial Advisors LLC, Veritas Advisors Inc., and two individuals linked to the firms. The agency accuses Veritas Advisors and Patrick J. Cox of Wellesley of stealing $1.2 million from a client's account between 1998 and 2005. Also accused is Rita A. White of Boston, whom the SEC alleges took $1.3 million from the same client between January 1999 and March 2005. Veritas Advisors Inc.'s listed telephone number was not in service yesterday. (Keith Reed)
Staples CEO gets $1.88m of restricted shares Staples Inc.
awarded chief executive Ronald Sargent $1.88 million in restricted shares. Sargent, 50, was granted 76,700 restricted shares, half of which will vest on the second anniversary of the grant, with the rest vesting on the third anniversary, Framingham-based Staples said in a regulatory filing. Sargent also received options to purchase 431,250 shares, the company said. (Bloomberg)
Southwest raises one-way fares because of fuel cost Southwest Airlines Co.
raised fares by $3 or $10 for one-way trips and boosted the limit on its refundable fare to $319. The weekend increase was the fourth by the nation's leading low-cost carrier this year and the ninth in the past two years. The company said it raised one-way fares by $10 on flights longer than 1,000 miles and $3 on flights of 751 miles to 1,000 miles. A spokeswoman said the increases were prompted by high fuel prices. (AP)
Bank of China shares jump 23% on first trading day
Bank of China's shares surged 23 percent on the first trading day after the mainland's biggest initial public offering. The bank's IPO, which raised nearly $2.5 billion, is expected to help revive China's stock markets, and its strong start suggests investors are hungry for new shares, analysts said.
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