Business Briefing
Banner year for undoing Ponzi scams
It was a rough year for Ponzi schemes. In 2009, the recession unraveled nearly four times as many of the investment scams as fell apart in 2008, with “Ponzi” becoming a buzzword again thanks to the collapse of Bernard Madoff’s $50-billion plot.
Tens of thousands of investors, some of them losing their life savings, watched more than $16.5 billion disappear like smoke in 2009, according to an Associated Press analysis of scams in all 50 states.
Although the dollar figure was lower than in 2008, that’s only because Madoff -- who pleaded guilty this year and is serving a 150-year prison sentence -- was arrested in December 2008, so his scheme didn’t count toward this year’s total. In all, more than 150 Ponzi schemes collapsed in 2009, compared with about 40 in 2008.
BANKING
Morgan Stanley splits top jobs
Morgan Stanley, the sixth-biggest U.S. lender by assets, has amended its bylaws to separate the roles of chairman and chief executive and to create a committee of directors to assess risks.
John Mack is to step down as CEO at year’s end, remaining chairman and turning over the CEO job to Co-President James Gorman.
Shareholder advocates have lobbied companies to split the roles of chairman and CEO to make boards more independent of management.
TELECOM
N.Y. iPhone sales briefly halted
AT&T Inc. suspended online sales of iPhones to New Yorkers over the weekend for unknown reasons, then abruptly started selling them again just as mysteriously Monday.
A spokesman said only that the phone company periodically “modifies” its distribution channels. He had no further comment on the resumption in sales, and officials with phone maker Apple Inc. did not immediately return messages for comment.
Bloggers speculated that the sales suspension was a means of managing data traffic, since AT&T has acknowledged that its network is overburdened with iPhone users in New York and San Francisco.
However, because the phones were still available in New York retail stores and from Apple Inc.’s website, the ban may instead have been an attempt to curb buyers who renege on the service contracts and resell the phones to customers of other carriers overseas.
-- times wire reports
