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Business Briefing

January 13, 2010

BANKING

BofA hid Merrill losses, SEC suit says

Bank of America Corp. failed to disclose billions of dollars in losses at Merrill Lynch & Co. before a shareholder vote to take over the bank in 2008, the Securities and Exchange Commission said in a lawsuit.

The suit was filed in federal court in Manhattan less than a day after U.S. District Judge Jed Rakoff ruled in a different SEC suit against Bank of America that the commission must file a separate case to pursue claims that the bank failed to disclose "extraordinary losses" by Merrill Lynch in the weeks before investors voted on the deal.

"Bank of America kept shareholders in the dark as they were called upon to vote on the proposed merger at the end of a quarter of nearly unprecedented volatility and uncertainty," the SEC said in the complaint.

BofA exec takes over vital post

Bank of America Corp. named its chief financial officer, Joe Price, to head its consumer and small-business banking operations.

Price takes the position held by new Chief Executive Brian Moynihan, who is seeking to overhaul the bank and lift it out of the slump caused by the recession and billions of dollars in soured loans.

BofA also said Gregory Curl was being replaced as chief risk officer by Bruce Thompson, currently managing director of the bank's global capital markets unit.

COURTS

Homestore CEO is guilty of fraud

The former chief executive of online real estate listings company Homestore Inc. pleaded guilty, as expected, in a scheme to inflate the company's revenue in order to mislead Wall Street analysts.

Stuart Wolff faces up to five years in prison when he is sentenced April 19 for conspiracy to commit securities fraud.

Eleven others have also been convicted in the case.

Ponzi scam yields 13-year sentence

A San Clemente man was sentenced to 13 years in prison for running a Ponzi scheme in which about 130 people lost more than $21 million and for trying to get a false passport to flee the country.

John Anthony Miller, 52, pleaded guilty in March to mail fraud related to the Ponzi scheme and to bribery, passport fraud and identity fraud related to his attempt to get a fake passport when his scheme collapsed. He was sentenced Monday in federal court, according the U.S. attorney's office in Los Angeles.

COMPUTERS

HP CEO's pay cut to $30.3 million

Hewlett-Packard Co. gave Chief Executive Mark Hurd $30.3 million in compensation last year, down from $42.4 million in 2008.

Hurd's pay package included $1.27 million in salary, a bonus of $1.18 million, stock and options valued at $12.8 million and other incentive compensation of $14.6 million, according to a Securities and Exchange Commission filing.

AVIATION

Boeing ahead of Airbus in receipts

Europe's Airbus topped Boeing in the number of planes produced and in the total of new orders last year, but the U.S. company prevailed in perhaps the most important tally: actual money received for airplanes delivered to customers.

Whether calculated on list prices or on more realistic data using standard sales discounts, Boeing's deliveries were worth about $4 billion more than Airbus'.

Airbus said it won 271 net orders versus Boeing's 142 and delivered a company record 498 airplanes compared with Boeing's 481.

-- times wire reports

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