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The FBI made the first arrest in the Stanford Financial Group fraud investigation Thursday, detaining Chief Investment Officer Laura Pendergest-Holt on federal obstruction charges.

The U.S. Justice Department said Pendergest-Holt was to make an initial court appearance before a U.S. magistrate in Houston Friday after her arrest by FBI agents — in a federal criminal probe that began in June 2008.

It corrected an earlier release that said she had already made a court appearance.

The department said Pendergest-Holt concealed her role in and familiarity with the investments of the Antigua-based Stanford International Bank from Securities and Exchange Commission investigators earlier in February.

U.S. securities regulators have filed civil charges against the financial group’s chairman, Allen Stanford, along with Pendergest-Holt and Chief Financial Officer Jim Davis, accusing them of fraudulently marketing $8 billion in high-interest certificates of deposit issued by the Antigua bank.

In Houston, Pendergest-Holt’s attorney, Brent Baker, said by telephone that "she is looking forward to having the truth come out and to putting this whole affair behind her as soon as possible."

The criminal complaint against Pendergest-Holt said she failed to tell investigators she had served on the bank’s investment committee and that the investment portfolio holding more than 80 percent of its assets included a $1.6 billion loan to a top Stanford executive — evidently Stanford.

It said Pendergest-Holt wrongly denied she had prepared with company officials before her SEC interview no fax pay day loan.

The complaint charging her said, during those preparations, Pendergest-Holt and other officials learned of the $1.6 billion loan and that $541 million credited as a capital contribution in December 2008 consisted of assets already bought by the bank just months before for $88.5 million.

It quoted an attorney who had helped in the sessions as saying, on a day in which one witness had threatened to go to the authorities, "the party is over."

Separately, a source familiar with the case said Stanford had not retained an attorney as of earlier this week and that paying for legal help was a problem because authorities had frozen all of his assets.

There were reports last week, after Stanford was served in Virginia with the civil papers, that he had hired high-profile Washington lawyer Brendan Sullivan. But the official said: "You would not get Brendan Sullivan to take a charity case."

Davis, he said, was in talks on arranging representation.

SEC Deputy Enforcement Director Scott Friestad said after Pendergest-Holt’s arrest: "We appreciate the quick and decisive action of the Department of Justice and the FBI, and thank them for their fine work and cooperation in this matter." 

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JPMorgan Chase & Co said it expects losses of $1 billion to $1.4 billion in each quarter of 2009 tied to its “non-credit-impaired” home equity loan portfolio.

The second-largest U.S. bank also said on Thursday that falling home prices may result in more borrowers with home equity loans owing more than their residences are worth. It said this could affect 35 percent to 39 percent of home equity borrowers at the end of 2009 and 36 percent to 41 percent at the end of 2010, up from 27 percent at the end of 2008.

JPMorgan said it expects to open 120 new retail branches this year, even as it cuts a net $2 billion of costs tied to its September acquisition of the banking units of the failed lender Washington Mutual Inc online payday advance. In connection with the merger integration, JPMorgan projects a total of 12,000 job cuts from the time the merger was announced.

The New York-based bank stood by its forecast for a 7 percent first-quarter net charge-off rate within its card services business.

JPMorgan disclosed its outlook on its website in slides to accompany an investor presentation later Thursday.

The bank’s shares closed Wednesday at $21.73 on the New York Stock Exchange. JPMorgan slashed its common stock dividend 87 percent on Monday.

(Reporting by Jonathan Stempel; editing by John Wallace)

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PHILADELPHIA — HBO on your PC? It could happen sooner than you think.

Wary of the growing number of consumers watching TV shows online for free — and yet reluctant to upset viewers by yanking shows from the Internet — the nation’s largest cable operators are in talks with media conglomerates to take back control. They would set up a platform to release cable TV shows online, but exclusively for paying subscribers.

It’s a delicate dance for the cable TV service providers and the owners of the cable networks.

Potentially at stake is the business model of cable television. The service providers pay networks a per-subscriber fee each month for the right to carry channels. But the cable companies have groused that they are paying for content that programmers are giving away for free on the Web.

Jeff Gaspin, president of NBC’s Universal Television Group, said that the idea of collaborating with cable operators on online video had been floated for a while but that talks began in earnest this year.

"There’s pressure on all of us," he said, referring to TV networks. "We get paid quite a bit of money from cable operators. … It’s important we find ways to do business that protects that business model."

At the same time, "consumers want content where they want it and when they want it," Gaspin added. If the networks don’t provide it, "they’ll get it any way they can."

Gaspin and others familiar with the project said the new service would probably be free to cable TV subscribers. But a small fee might be assessed.

Sam Schwartz, executive vice president of Comcast Interactive Media, said the company wasn’t looking at the effort as "some enormous new revenue opportunity" but wants to add value that will keep customers from leaving guaranteed online personal loans. Comcast calls its initiative "On Demand Online."

One model being discussed is for Philadelphia-based Comcast to expand its lineup of cable shows on Fancast.com, its website that aggregates TV shows and movies for free viewing, much like Hulu.com. But only subscribers could access the shows. It’s not yet clear how subscribers would be authenticated; it would be easier if the customer also buys high-speed Internet service from the cable company.

Other cable operators wouldn’t create a new website, but they would steer subscribers to the cable networks’ websites, such as HBO.com, where they would be able to see an expanded array of shows.

About 34 percent of adults who go online at home watch videos over the Internet at least every week, up from 25 percent two years ago, said a survey released Monday by Leichtman Research Group.

People aren’t yet cutting the cord en masse — the Leichtman survey found that people who watch recent TV shows online every week are not more likely to give up TV service than other people. But the industry is heading off what could end up as a troubling trend. After all, the availability of free content online has befuddled other media industries, from music to newspapers.

The cable companies and others involved in the talks for a TV service said their goal wasn’t to kill the online video goose, but to work out a plan that would keep everyone’s business intact.

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UBS AG may face a mini-trial in a U.S. court in July as it fights efforts to force it to disclose the names of 52,000 U.S. clients suspected of offshore tax evasion, the New York Times reported on Tuesday.

UBS, the world’s largest banker to the rich, agreed last week to pay a $780 million fine and disclose the identity of about 300 of its U.S. clients to avert criminal charges.

But the Swiss bank is still facing a civil case in which U.S. authorities are seeking access to the names of another 52,000 clients.

On Monday, a U.S. judge gave the bank until April 30 to oppose the efforts and to argue it deserved the legal equivalent of a trial, the New York Times reported guaranteed high risk personal loans.

The judge said in a public conference call with UBS lawyers and Justice Department officials that any such mini-trial would take place on July 13, the newspaper reported.

UBS was not immediately available for comment.

UBS said last week it could go out of business if it complied with an order to reveal the names, saying the U.S. case would force it to violate Swiss criminal law by turning over information protected by Swiss financial privacy laws.

(Reporting by Emma Thomasson; Editing by Mike Nesbit)

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Get over it. Move ahead.

That’s the tough-love prescription for investors debilitated by the economic and financial downturn. Yesterday’s gone, so deal realistically with the world before you.

As you begin to rebuild your savings and investments, take a deep breath and revisit the value of every holding that you own. Too many Americans are still stuck in avoidance mode.

"Folks won’t even look at their investment statements because they’re so worried and upset about the market, and that is a mistake," said Marilyn Capelli Dimitroff, a certified financial planner and president of Capelli Financial Services Inc. in Bloomfield Hills, Mich. "Stop thinking about history and where your investments were a year ago, because what you have now is what you have."
Although you can assume investment values will revive at some point, your projections for the future should consider current figures. In particular, go over 401(k) and other retirement accounts to see how your retirement prospects look.

Determine how much you need to save and invest regularly to get your overall assets back on track. Deferred spending is still the major component in wealth-building.

"Decide if your pool of assets is still enough, and if not, take action either by doing more saving and investing, or by cutting your spending," Capelli Dimitroff said. "With U.S. equity markets down more than 30 percent, you have to ask yourself if you could sustain another loss like that, because, if not, it is time to start ratcheting down equity exposure by selling some stocks."

For the fixed-income component of your portfolio, she recommends Treasury inflation-protected securities, known as TIPS, whose returns are indexed to compensate bondholders for inflation. And brave investors should at least consider some discount-priced stocks.

"There’s less risk in the stock market now than when the Dow Jones industrial average was at 14,000 and everybody loved it," said Capelli Dimitroff, who recommends a portfolio diversified among U.S. and foreign stocks, large- and small-cap stocks, and growth and value styles in order to reduce risk. "The price-earnings ratios of stocks are more in line, expectations are low and valuations are low."

More than ever, you need a budget you can follow and a regular plan to put your money to work.

"Handling this market is akin to trying to lose weight, because to lose a pound you must burn more calories than you take in," said Paul Larson, editor of the Morningstar StockInvestor newsletter in Chicago. "Similarly, you must save more money than you spend."

A bigger blunder than avoiding investments is panicking and dumping everything you own. Although money-market funds and bank certificates of deposit provide a safe underpinning for your portfolio, their low returns mean you’ll eventually need the longer-term inflation hedge that stocks historically have provided lowest fee payday loans.

"Resist the urge to sell everything that dropped in value, for this market isn’t going to persist forever," Larson said. "Yet if you do have too much in equities, this would be a good time to lighten up, because you will need balance and diversification."

If you’re mentally and emotionally up for stock investing, Larson sees potential in health care stocks, especially if the market downturn is prolonged and favors reliable industries. Johnson & Johnson and Novartis AG are solid companies with good balance sheets, cash flow, industry positioning and discounted stocks, he said.

Consumer staple stocks should also hold up relatively well versus the rest of the market, Larson predicts, with Coca-Cola Co., PepsiCo Inc. and Diageo PLC his favorites.

"If any investor has a low tolerance for risk, the financial space — primarily bank stocks — is still an area with enormous risk but also the most potential going forward," Larson said. "If I was placing money on a stock I thought would triple in the next year it would be a bank stock, but if I was choosing one that could potentially fall to zero, it would also be a bank stock."

Jack Bowers, editor of the independent Fidelity Monitor newsletter (www.fidelitymonitor.com) in Rocklin, Calif., advises conservative investors to move into high-yield corporate bond funds now so "you get paid while you wait" for the market to revive. Revival of stocks may take a while, but he does see improvement.

"We’ve seen a sense of relief when companies announce earnings only down by one-third from last year, since that’s not so bad in this environment," Bowers said. "It also suggests that market valuations are getting in line with reality."

So much has to be decided in Washington and on Wall Street, progress will be gradual, experts said. Bowers expects a three- to five-year recovery period for stocks without significant progress for another year. The "fear factor" has caused all bank stocks to get clobbered, and he would avoid the stocks of autos and big banks, though he sees deals in smaller banks.

He concurs with Larson’s confidence in a comeback by consumers.

"The place to play right now is probably consumer stocks because they’ll benefit from the stimulus package and were the first ones to languish a long time ago when housing prices started going down," Bowers said. "Consumer stocks aren’t dropping as much on the down days, and they’re rising more on the up days."

So move ahead. Don’t look back.

andrewinv@aol.com

2009, TRIBUNE MEDIA SERVICES INC.

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Top cell phone maker Nokia will use Qualcomm’s chips in its advanced cell phones, the firms said on Tuesday, marking a further warming of ties between the former courtroom rivals.

The cooperation gives Qualcomm access to a major share of the smartphone market, while it enables Nokia to further lower production costs.

“In the end of the day Qualcomm needs Nokia as much as Nokia needs Qualcomm,” said Gartner analyst Carolina Milanesi.

The deal marks the first time Nokia will use Qualcomm chipsets in its 3G phones, and brings the firms closer together after years of bitter disputes over intellectual property rights and royalty payments.

“We are very excited about this opportunity,” Andrew Gilbert, the head of Qualcomm’s European business told Reuters in an interview. “We are going to compete for as much of their business as we can.”

Nokia’s key suppliers of 3G chipsets have been Texas Instruments and STMicro, which has spun off wireless chips into a joint venture with Ericsson.

Nokia and the new ST-Ericsson venture said on Tuesday they would cooperate on providing ST-Ericsson’s U8500 chips for 3G smartphones using Symbian foundation software.

Nokia said on Tuesday it had tapped also Broadcom, its current supplier of second-generation technology chips, to supply 3G chipsets.

NOKIA EYES U.S. MARKET

Nokia and Qualcomm agreed last July to a 15-year settlement that included a hefty 1 payday loans with no fax.7 billion euro one-time payment from Nokia, ending a three-year legal battle where the firms raised dozens of cases against each other on three continents.

The agreement also comes against the backdrop of an ailing cell phone market, with 2009 sales set to drop as consumers rein in spending on new gadgets due to the economic recession.

Nokia said it would introduce the first model using Qualcomm chipset and Nokia’s software in the middle of next year.

The phones would initially be for the North American market and work on third-generation networks and run on the Symbian operating system, the most widely-used smartphone software that is currently controlled by Nokia but will eventually be made royalty-free for all users.

Nokia shares were down 2.2 percent at 9.11 euros on a weaker Dow Jones Stoxx European Technology Index.

“I don’t see the markets reacting since the products are expected to be sold only around mid-2010,” said Nordea analyst Martti Larjo. “(But) at least the cooperation shows that Nokia is focusing its efforts on the North American market.”

Nokia has long struggled in the U.S. market. North American sales dropped 20 percent year-on-year in the fourth quarter, and Nokia’s North American market share of some 8.7 percent was well below its global figure of 37 percent. 

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The U.S. Congress is set to give final approval today on a $789 billion economic stimulus package after lawmakers worked out last-minute disagreements over executive compensation and taxes.

The House and Senate have scheduled votes on the measure, one of the most expensive bills produced by Congress. Its expected passage in the Democratic-controlled chambers will hand President Barack Obama his first major legislative victory, sending to his desk a plan for government spending and tax cuts that he and other Democrats have said is needed to help right the economy.

“It will create millions of jobs,” House Speaker Nancy Pelosi, a California Democrat, said yesterday. “It’s very significant for the American people; in terms of the opportunities for jobs, and tax cuts, and the education of their children, the health of their families.”

Democrats announced Feb. 11 they had reached an agreement that reconciled competing stimulus plans approved by the House and Senate. Still, the party’s congressional leaders spent much of yesterday haggling over the accord’s details.

One dispute focused on how to restrict executive compensation at companies participating in the Treasury Department’s Troubled Asset Relief Program. Lawmakers agreed to drop one amendment, sponsored by Democratic Senator Ron Wyden of Oregon, which would have required firms to pay back the cash portion of bonuses topping $100,000.

Executive Compensation

A second executive compensation amendment by Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, proved nettlesome for negotiators. Lawmakers announced late in the day the bill would expand upon pay restrictions announced earlier this month by the Obama administration.

The provision would impose compensation limits on all TARP recipients rather than just those receiving the most assistance. And it requires those recipients to rescind bonuses awarded to their highest-paid workers that were based on earnings statements found to be “materially” inaccurate.

“The decisions of certain Wall Street executives to enrich themselves at the expense of taxpayers have seriously undermined public confidence in efforts to stabilize the economy,” Dodd said. “American taxpayers deserve better.”

Lawmakers also faced objections yesterday from Republican Senators Olympia Snowe and Susan Collins, both of Maine, over the slashing of what had been a sweeping tax cut for businesses.

Proposal Scaled Back

The tax break as proposed would have let all companies except those participating in the TARP program claim an estimated $67 direct lender payday loans.5 billion in refunds this year and next by applying current net operating losses to past profitable years. Negotiators on Feb. 11 scaled back the proposal so that only companies with receipts under $5 million could claim it.

That drew objections from Snowe and Collins, whose support Democrats needed to pass the Senate’s version of the stimulus plan earlier this week. Negotiations raised the threshold for qualifying businesses to those with $15 million in gross receipts, still below the level where large companies could benefit.

House Majority Leader Steny Hoyer, a Maryland Democrat, said the chamber’s members will begin debating the stimulus package this morning and that a vote is likely in the afternoon.

Senate Majority Leader Harry Reid, a Nevada Democrat, said the vote in his chamber likely will occur late afternoon or early evening.

Text Delayed

The text of the 1,400-page stimulus plan didn’t become publicly available yesterday until about 11 p.m. Washington time. House and Senate Republicans complained during the day that they wouldn’t have enough time to review it and that Democrats were shirking on their commitment to running a more transparent government.

No Republicans in the House voted for that chamber’s bill when it was approved, 244 to 188, last month. House Minority Whip Eric Cantor, a Virginia Republican, suggested yesterday a few party defections may occur today, saying he expected a “fairly unified” vote against it. The House bill’s opponents also included 11 Democrats.

The Senate passed its bill 61 to 37, on Feb. 10, with Republicans Snowe, Collins and Arlen Specter of Pennsylvania joining the chamber’s 58 Democrats in supporting it.

One Republican senator, Judd Gregg of New Hampshire, abstained from voting because Obama had nominated him to serve as commerce secretary. Gregg yesterday withdrew from consideration for the post, citing policy differences with the administration.

Gregg declined to say the position he’d take today on the stimulus plan. “Can I save that for tomorrow when we vote?” Gregg told reporters when asked yesterday.

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Bob Marley’s family and Hilco Consumer Capital, a private equity firm that invests in retail brands, are preparing a major push to license the late reggae legend’s likeness, trademarks and themes for apparel, food and even video games, the Wall Street Journal said.

Hilco, which has compiled a stable of retail brands including Halston and Ellen Tracy, this month invested some $20 million for half of House of Marley LLC, a joint venture with the Marley family, the paper said, citing people familiar with the matter.

The House of Marley will sell the rights to produce products under the brands Bob Marley, Tuff Gong, Catch A Fire and One Love, the paper said.

The reggae singer’s name and likeness have been used on unauthorized merchandise since his death in 1981 banks issue payday loans. The first step for the Marley venture would be to combat companies that use the Marley name without permission, the report said, citing

the chief executive of Hilco Consumer Capital, James Salter.

Hilco is separately negotiating to acquire rights to instant-film creator Polaroid’s trademarks and to Fortunoff, a well-known New York jewelry and silverware retailer, the paper said, citing its source.

Hilco and the Marley family could not be immediately reached for comment by Reuters.

(Reporting by Ajay Kamalakaran in Bangalore; Editing by Valerie Lee)

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In this recession, not even an education can shield you from losing your job.

The unemployment rate among workers with college degrees rose to 3.8 percent, the highest level since records began in 1992, the Labor Department reported today. The rate for workers with some college or an associate’s degree also climbed to a record, at 6.2 percent.

“This particular recession is hitting workers with more levels of schooling harder than past recessions have hit them,” said Heidi Shierholz, an economist at the Economic Policy Institute, a Washington research group typically aligned with the labor movement. “It’s just a deeper recession, it’s more widespread, its tentacles are reaching everywhere.”

According to EPI data, the level of unemployment among people with college educations is the highest since January 1983. With banks merging and manufacturers like Caterpillar Inc. eliminating management positions, the ranks of college-educated unemployed may continue to grow, economists said.

“This is a deeper recession and it has really accelerated over the last several months,” said Christine Owens, executive director of the National Employment Law Project. “There will be income losses throughout the economy ace cash advance.”

Consumer spending, which accounts for about 70 percent of the economy, dropped 3.5 percent in the fourth quarter, following a 3.8 percent fall in the previous three-month period. It was the first time decreases exceeded 3 percent back-to-back since records began in 1947.

Job Losses

The U.S. lost 598,000 jobs in January and the total unemployment rate soared to 7.6 percent, the highest since 1992, from 7.2 percent in December, the Labor Department said today.

According to today’s report, 45.2 million workers, or 30 percent of the civilian labor force, have at least a bachelor’s degree. That was the biggest share of civilian workers.

President Barack Obama today said rising U.S. unemployment shows the urgent need for government action on the economy and any delay of his stimulus plan in Congress would be “inexcusable and irresponsible.” He also announced the formation of a panel of advisers, led by Paul Volcker, a former chairman of the Federal Reserve.

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Planned layoffs at U.S. firms in January reached their highest monthly level in seven years, according to a report released on Wednesday, as the more than year-old U.S. recession took an increasingly heavy toll on employment.

The impact of an economic slump that is likely to be the most protracted since the 1930s Great Depression is broadening across a wide range of industries, outplacement company Challenger, Gray & Christmas said in its monthly report on U.S. job cuts.

Job cuts announced in January totaled 241,749, up 45 percent from December’s 166,348. Layoffs were up from 74,986 in the year-ago period.

Record downsizing in the retail sector, with 53,968 layoffs planned, was the biggest area for job cuts and contributed to the overall rise in January’s total, Challenger said.

“The variety of industries represented among the top five job-cutting sectors in January is further evidence of how far the impact of this recession has spread,” said John A no fax cash advance. Challenger, chief executive officer of Challenger, Gray & Christmas, in a statement.

“Industries that at first appeared to be immune to downturns, such as computer and pharmaceutical, are now rapidly shedding workers,” he added.

The financial sector, however, had its lowest one-month total since 2005, with 1,458 job cuts announced in January, down from 39,604 in December.

The Challenger data comes ahead of the government’s closely watched non-farm payrolls report on Friday, which is expected to show 525,000 jobs were lost in January, according to the median of forecasts in a Reuters poll.

(Reporting by John Parry; Editing by Leslie Adler)

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