$5M FalconStor settlement ... and other business briefs
$5M FalconStor settlement
FalconStor Software Inc., a Melville-based data-storage company, has agreed to pay $5 million to settle a class-action shareholder lawsuit stemming from a federal probe into a bribery scheme. The scheme involved FalconStor's former CEO, ReiJane Huai, and two former salesmen who allegedly paid $300,000 in bribes to executives at JPMorgan Chase & Co. in exchange for $12 million in contracts. Huai committed suicide in 2011, the day before he was scheduled to plead guilty. "The agreement to settle the class-action lawsuit represents another significant step forward for our company and our shareholders," said Jim McNiel, who took over as CEO after the scandal broke. In June, FalconStor agreed to $5.8 million in criminal and civil penalties related to the case. -- JOE RYAN
Fed pays government $88.9B
The Federal Reserve says it paid the federal government a record $88.9 billion in 2012. The central bank earned the money from the Treasury bonds and mortgage-backed securities it has purchased to drive interest rates lower and boost the economy. The 2012 payment was up 17.9 percent from 2011 when it paid the federal government $75.4 billion. It also surpassed the previous record payment of $79.3 billion made in 2010. The Fed began buying Treasury bonds and mortgage bonds during the last recession and has kept up the effort since the downturn ended in June 2009 in an effort to boost the subpar recovery and lower high unemployment. It is currently purchasing $85 billion in bonds each month.
Jobless applications up slightly
Weekly applications for U.S. unemployment benefits ticked up slightly last week, the latest sign of slow but consistent gains in the job market. The Labor Department said Thursday applications rose 4,000 to a seasonally adjusted 371,000, the most in five weeks. The previous week's total was revised lower. The four-week average, a less-volatile measure, increased 6,750 to 365,750. It had fallen to a four-year low the previous week. A department spokesman said all states reported data and none were estimated. In the previous two weeks, the department relied heavily on estimates because many states weren't able to report data over the holidays.
Higher bank earnings expected
The big banks are set to begin reporting their fourth-quarter earnings, starting with Wells Fargo Friday. For most, analysts are predicting higher earnings. That doesn't necessarily mean that banks are making big gains in revenue or lending. Profits are expected to be driven by cost cutting, which means the banks are slashing jobs, and because they're releasing some of the reserves they'd stored up for loans that might go bad. The banks are also facing lawsuits from shareholders and the government over risky mortgage lending and other practices. The most recent reminder was Monday's national settlement over foreclosure abuse. Analysts say that the banks' future legal costs are unpredictable.
Immigration overhaul eyed
The president of the U.S. Chamber of Commerce said Thursday the "door to the American dream must always remain open" as he announced a broad coalition of business, labor, faith organizations, law enforcement and ethnic groups intent on overhauling the nation's immigration system. Tom Donohue outlined his priorities for immigration legislation and expressed optimism that after years of ill-fated efforts, there is momentum in the White House and Congress to tackle the politically charged issue. Donohue said any legislation should include increased border security. He also favors a national employee verification system, which has been a contentious issue in the debate. -- AP