SEC Targets Timing of Insiders' Trade Notices (WSJ)
The Securities and Exchange Commission is stepping up its scrutiny of corporate executives who sell shares in their own companies, announcing a raft of cases Wednesday against insiders for allegedly breaking rules on disclosing stockholdings and trades. The action, on an unprecedented scale for such offenses, is part of the "broken windows" strategy SEC Chairman Mary Jo White announced almost a year ago. She said the strategy—named for policing tactics used in New York that sought to reduce serious crime by not tolerating minor violations—will mean "even the smallest infractions" are pursued. SEC investigators decided to step up their focus on insider transactions because of concerns about poor levels of compliance, enforcement chief Andrew Ceresney said. The agency filed civil charges Wednesday against 36 individuals and companies, with none of them involving a penalty of more than $375,000.
Senators urge Burger King to ditch move to Canada (Reuters)
Dick Durbin, the No. 2 Senate Democrat, and four other lawmakers argue that move is unfair because many Burger King workers count on programs such as Medicaid and food stamps that rely on taxpayer funding. They also said, in a letter to Burger King Chief Executive Officer Daniel Schwartz that was dated Thursday, that the burger chain uses taxpayer-supported roads, food safety inspectors and other perks of doing business in the United States. "Now, after profiting from these taxpayer-funded benefits, Burger King intends to move its tax address overseas to avoid paying its fair share for these benefits," the group said in the letter, which was viewed by Reuters. "Many of your loyal customers may choose to spend their hard-earned money at one of your many competitors, instead of supporting a company that wants all the benefits of America but refuses to pay its fair share to support our nation," they said. In addition to Durbin, Senate Democrats Jack Reed, Sherrod Brown, Carl Levin, and Independent Bernie Sanders signed on. At least nine U.S. companies are in the final stages of inversions, which involve buying a competitor in a lower-tax country and basing the combined business there. Democrats, worried the moves will erode the U.S. corporate tax base, have called the deals "unpatriotic" and floated a number of proposals to crack down on them.
Berkshire Official Calls Those Seeing Burger King Move as a Tax Inversion 'Mad' (WSJ)
Charles T. Munger defended recent decisions by his business partner, Berkshire Hathaway Inc. Chairman Warren Buffett, and predicted that Berkshire would grow robustly. Mr. Munger, 90 years old and known for his bluntness, took on critics of the so-called tax-inversion deal, partly financed by Berkshire, in which Burger King Worldwide Inc. is planning to relocate to Canada in the wake of its proposed merger with Tim Hortons Inc. Mr. Munger, who is Berkshire's vice chairman, said that Ontario-based Tim Hortons is the larger of the two companies and, because "the bigger company should get the headquarters," anyone who thinks the deal is motivated purely by tax considerations is "stark raving mad."
Twitter Seeks Up to $1.5 Billion in Debt Offering (Bloomberg)
The San Francisco-based microblogging company is selling the convertible bonds in two $650 million pieces, one maturing in five years and one coming due in seven years, according to a regulatory filing today. The offering size may increase to $1.5 billion if the banks involved exercise an overallotment option. Twitter, which isn’t projected to be profitable this year, has been investing to build up its advertising business and add engineers who can help tweak its product to appeal to a broader audience. Executives see an opportunity in the debt market to raise more cash cheaply with little immediate dilution of their shareholders’ ownership, according to a person familiar with the matter. The company was inspired by technology leaders, including Google Inc. and Netflix Inc., successfully offering debt while borrowing remains inexpensive, the person said.
Chipotle Near Penn State Closes After Workers Quit (Bloomberg)
A Chipotle restaurant near Pennsylvania State University temporarily closed after workers quit, citing “borderline sweatshop conditions.” A sign in front of the restaurant, which was posted on Twitter, blamed the walkout on Chipotle’s pursuit of profit over people. While the sign said almost all of the management and crew resigned, the Denver-based company said that it was a minority of the staff. “Our Penn State restaurant was closed when a few employees quit, locking out a majority of others who are enthusiastic to return to work,” Chris Arnold, a spokesman for Chipotle Mexican Grill Inc., said in an e-mail. The store reopened this afternoon, he said.
Argentina says U.N. vote vindicates its debt fight against 'vultures' (Reuters)
The Argentine government said on Wednesday that its refusal to repay a group of U.S. hedge funds that stand to profit on the country's defaulted debt was vindicated by the United Nations' support for a multilateral plan handling bond restructurings. The lengthy legal battle between Argentina and the funds that snapped up its bonds on the cheap after its record 2002 default and are suing for 100 cents on the dollar led to the Buenos Aires government defaulting again in July. Cabinet Chief Jorge Capitanich's comments came on the same day the lower house of Congress held a marathon debate over a draft law proposing to remodel the country's debt to enable it to skirt U.S. court rulings in support of the hedge funds. The lower house is expected to vote in favor of the bill in the early hours of Thursday. But the law may not achieve much if legal hurdles and investor scepticism prevent the proposed restructuring measures from being implemented. President Cristina Fernandez says her country is the victim of "vulture funds" that are prepared to wreck its finances in their pursuit of huge profits. She wants a global framework that would prevent a minority of investors from scuppering debt restructuring agreements. Prompted by Argentina and its ally Bolivia, the U.N. General Assembly voted overwhelmingly in favor of such a convention. "If 124 countries in the United Nations support the Republic of Argentina, it means that Argentina is right in its claims," Capitanich told reporters in Buenos Aires.
Naked Satan Statue Has Vancouver Locals Asking, 'What The Devil?' (HP)
The 9-foot-tall statue was a representation of the devil, complete with red skin, a pointed tail and horns atop his head. The statue also holds one hand up in a devil-horn salute familiar to heavy metal fans the world over. But what has aroused controversy is the statue's prominent, erect phallus, CTV News reports...The satanic statue was erected on Tuesday on a pedestal that previously was home to a bronzed — and clothed — Christopher Columbus commemorative statue installed in 1986, according to Straight.com. The statue was moved to the Italian Garden in Hastings Park 10 years ago. No one has claimed responsibility for the naked Satan, according to CTV News. But the bulging Beelzebub was quickly removed because city officials weren't exactly nuts about it. “The statue was not a piece of city commissioned artwork and consequently it has been removed,” Sara Couper, a City of Vancouver spokeswoman, told GlobalNews.ca. City officials haven't said what they plan to do, but a man named Mike Granger has started a petition on Change.org asking it be given to him for inclusion in an "Odditorium" he runs, according to the Winnipeg Sun. One of the lines in the petition warns the city: “By removing the statue of Penis Satan, you are taking from us our freedom of expression, restricting our sexuality, and stigmatizing our religious beliefs. Please return him immediately."
Stock Analysts Seek Upgrade by Scaling Down (WSJ)
This shift to smaller firms is driving a yearslong decline in big banks' share of the research market, according to financial-services consulting firm Greenwich Associates. Since 2007, the nine largest global banks have on aggregate lost more than one-fourth of their market share to smaller peers. This comes as fund managers are paying more attention to Wall Street research. For the first time in 12 years, money managers in the year ended February raised the share of stock-trading commissions allocated to research, according to Greenwich.
Family Dollar Fate May Hinge on Decision by Billionaire Paulson (Bloomberg)
The hedge fund founded by billionaire John Paulson is the third-largest holder of Family Dollar stock, with 7 percent of the shares outstanding, and the biggest investor that hasn’t yet publicly taken a stance on the three-way takeover battle. Family Dollar’s two largest shareholders, which control a combined 15 percent of the company, are backing an $8.5 billion bid from Dollar Tree Inc. (DLTR), saying the lower offer has a better shot of being approved by antitrust regulators. That leaves Paulson & Co., which also holds about 4 million shares of Dollar General, in a position to tip the scales. If Paulson supports the lower Dollar Tree bid, it would make it difficult for Dollar General to win over a majority of shareholders, said Noel Hebert, an analyst with Bloomberg Intelligence. “If you get 22 percent on one side of the fence, it’s a pretty high hurdle for Dollar General to cross to win enough shareholders over,” Hebert said. “Winning over a majority of shareholders becomes substantially more difficult.”
U.K. Bookies Are Betting Against Scottish Independence (BusinessWeek)
Polls suggest that Scotland’s independence movement could win a Sept. 18 referendum. British bookies aren’t buying it. The country’s two biggest bookmakers, Ladbrokes and William Hill , are laying 7-to-4 odds against a “yes” vote—even as Britain’s political elite is in a panic over polls showing the race is neck-and-neck. A poll released Sept. 9 by survey group TNS Scotland, showed pro-independence forces with 38 percent support, just one point behind the opposition, while a YouGov survey over the weekend showed the “yes” campaign with a narrow lead. If those findings are right, you’d expect odds close to 50-50. Yet most of the British bookmakers surveyed here are offering roughly 7-4 odds against independence, meaning that someone who bet 4 pounds on a “yes” vote would win 7 pounds plus the return of her stake if the “yes” campaign won. The payoff for a “no” bet would be much smaller, only 2 pounds on a bet of 5 pounds.
Tennessee man butt-dials 911, gets busted on drug charges: police (NYDN)
Grant O’Connor, 25, was allegedly heard talking about “pleasure shivers” and “tiny little pins” in his body after mistakenly calling police on his cell phone Friday evening, WKRN reported. The Mt. Pleasant dispatcher stayed on the line, listening to his bungling call, before being able to trace it to a Mexican restaurant. When a responding officer arrived, O'Connor and an unidentified woman were seen pulling out of the parking lot but had a taillight out on her vehicle. That officer used that opportunity to stop their car. Inside, they reported seeing a small bag of marijuana and drug paraphernalia underneath the passenger seat. “Really bad luck. And also some really good police work,” Mt. Pleasant Police Chief Michael Hay summed up the arrest to WKRN.