Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.law From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: law Wed, Aug 5 1992 Date: Wed, 5 Aug 92 04:32:44 EDT Message-ID: 08-05 0000 DECISIONLINE: Business Law USA TODAY Update Aug. 5, 1992 Source: USA TODAY:Gannett National Information Network FANNIE MAY MAKES PURCHASE: After 73 years of candy competition and candy confusion, Fannie May Candy Shops in Chicago plans to acquire the retail stores of Fanny Farmer of Cleveland. The merger will create the largest U.S. candy retailer, totalling 465 stores. Officials wouldn't discuss details of the sale, which will be completed by the end of September. Operations will be headquartered in Chicago. SALOMON BROS. TURNS AROUND: A year after Salomon Bros. admitted extreme foul play in Treasury bond auctions, it's clear the company has survived the scandal. But that hardly means investors should gobble up Salomon's stock, especially with business on Wall Street starting to slow, analysts say. Salomon no doubt will be around for a long time, but some analysts are turning cautious on the entire industry. GARAMENDI SUED BY ANA: A federal lawsuit was served Monday by the partners of a Louisiana-based ANA Insurance Group against Insurance Commissioner John Garamendi and members of his staff. The plaintiffs allege that Commissioner Garamendi and his staff willfully and with malice violated their civil rights. The ANA partners seek damages in excess of $185 million. FAA WINS PRAISE: A House panel Tuesday praised the Federal Aviation Administration for quickly drawing up new regulations to protect commercial airliner flights from the hazards of ice buildup. The standards take effect this winter. But lawmakers also criticized the agency for moving slowly in tackling aging commercial airliners, runway accidents and near-collisions between planes. CLEANUP ESTIMATE REDUCED: The Congressional Budget Office reduced its estimate of the cost of cleaning up failed savings institutions and banks to $135 billion from 1989 through 1998, about $20 billion less than an earlier CBO estimate. CBO Director Robert Reischauer attributed the decline to success in closing failed S&Ls and to the gap between deposit and loan rates, which has bolstered profits at banks and S&Ls. CLEANUP PROFITABLE: Congressional Budget Office director Robert Reischauer, in a statement to the House Banking Committee, said the decreased total for the thrift cleanup was in addition to the $60 billion spent before 1989. Reischauer said the cleanup program actually will earn the government $5 billion in fiscal 1992 because it has continued to sell assets inherited from failed thrifts. PREPARER GUILTY IN TAX SCANDAL: An Athol, Mass., tax preparer was sentenced to six months imprisonment Tuesday after pleading guilty to a 30-count indictment charging him with willfully aiding and assisting in the preparation of false federal income tax returns. Terry Akey was found guilty of preparing 30 individual and amended income tax returns classifying the eight taxpayers as independent labor contractors. WEBSTER NAMED REPRESENTATIVE: U.S. District Judge David Edelstein Tuesday named William Webster as the neutral third party on the Independent Review Board, to be established under the Consent Decree signed in 1989 between the government and the Teamsters Union. The government's representative to the IRB, Frederick Lacey, had asked the court to name Webster at a hearing Tuesday morning. JAPAN NOT KEEPING PROMISE: The USA says Japan isn't keeping its pledge to buy more foreign semiconductors and hinted that if progress isn't made, trade sanctions could be imposed. U.S. Trade Representative Carla Hills says Japan hasn't made sufficient progress on its August 1991 agreement to increase purchases of foreign computer chips to 20% of the Japanese market by the end of this year. PHAR-MOR UNCOVERS SWINDLE: Discount drugstore chain Phar-Mor said Tuesday it has discovered an elaborate financial swindle involving fraud and embezzlement by two of its top executives. Phar-Mor says the scheme, run by its former president Mickey Monus and chief financial officer Patrick Finn, will cost the company $350 million. Monus and Finn were fired last week after questions arose involving the company's finances. FEDERAL PROBE MAY FOLLOW: Phar-Mor CEO David Shapira, who took over as president, has asked for a federal investigation of Mickey Monus. Sharpira says Phar-Mor has laid off 100 of 800 workers at its headquarters and will take a $350 million charge against earnings to cover losses. JAPAN TO BOOST IMPORTS: Japan's Ministry of International Trade and Imports said Tuesday it plans to spend $1 billion through 1993 to boost imports. The initiative includes increasing government purchases of foreign goods and the start of free trade zones. Japan has been under pressure from its trading partners to reduce its burgeoning trade surplus with the rest of the world. Business Law Editor: Kate Coughlin. (919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM