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Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: Glenn Petersen who wrote (10862)	12/23/2002 11:57:54 AM
From: StockDung	Respond to of 19428

J.P. Morgan `Disguised Loan' E-Mails Admitted at Mahonia Trial By David Voreacos and David Glovin New York, Dec. 23 (Bloomberg) -- J.P. Morgan Chase & Co. Vice Chairman Donald Layton's e-mails describing prepaid transactions as ``disguised loans'' may be admitted as evidence in a fraud trial, a judge has ruled in a blow to the bank's case. J.P. Morgan has sued 11 insurers to force them to pay $1 billion on six surety bonds backing oil and gas trades between Enron Corp. and Mahonia Ltd, an offshore entity sponsored by the bank. The insurers refused to pay after Enron's collapse, saying the bank deceived them into backing loans, not commodity trades. U.S. District Judge Jed Rakoff said today that the insurers may present evidence of the e-mails, which the judge last week described as ``explosive.'' Rakoff turned aside the bank's bid to exclude the e-mails and said they may be ``highly probative,'' if the jury accepts the insurers' interpretation of what they mean. ``If the jury accepts defendants' view of what the e-mails are referring to (as the jury reasonably might), the term `disguised loan' is highly relevant and precisely descriptive of what is involved,'' Rakoff said in a 10-page ruling. The insurers in the case include units of Allianz AG, Chubb Corp., CNA Financial Corp., and Kemper Insurance Cos. The e-mails at issue date from May 1999 and are a major part of the insurers' case. In them, Layton discusses aspects of the bank's derivatives and prepaid commodities transactions. Rakoff earlier said the insurers could use them, only to reconsider last week after hearing Layton testify outside the jury's presence. `Impressive Witness' In one e-mail, Layton wrote, ``We are making disguised loans, usually buried in commodities or equities derivatives (and I'm sure in other areas.) With a few exceptions, they are understood to be disguised loans and approved as such. But I am queasy about the process.'' In another, Layton was responding to a request by the bank's legal staff that the transactions not be represented internally as a loan, ``given the remote risk that our internal records are subpoenaed.'' Layton responded by saying that he believed the deals should be treated internally as a loan. Rakoff described Layton as an ``impressive witness'' following last week's hearing. Earlier, Layton said what he was trying to convey through the term ``disguised loans'' was that equity derivatives and prepaid transactions involved loan-like cash advances that weren't subject to adequate internal controls, a defect he sought to remedy, Rakoff said. Layton is expected to testify for J.P. Morgan during the trial. A central issue in the case has been whether the insurers knew the true nature of the transactions and went ahead with the surety bonds anyway, as J.P. Morgan alleges. Investigations J.P. Morgan has said the bank's transactions with Enron are being investigated by the U.S. Justice Department, the Securities and Exchange Commission, the Federal Reserve Bank of New York, and Manhattan District Attorney Robert Morgenthau. Morgenthau has begun a grand jury investigation of J.P. Morgan's relationship with Mahonia, which is based in the Isle of Jersey and handled billions of dollars of gas and oil trades with Enron, people familiar with the case said. Prosecutors have subpoenaed Ian James, an Isle of Jersey attorney whose law firm, Mourant du Feu & Jeune created Mahonia as a special purpose vehicle for Chase Manhattan Bank in 1992, the people said. James was subpoenaed on Dec. 5, while on a break in his testimony as a witness for the bank. Chase merged into J.P. Morgan on Dec. 31, 2000. J.P. Morgan has denied wrongdoing in using Mahonia, saying it properly employed the entity to help companies raise capital.

To: Glenn Petersen who wrote (10862)	12/26/2002 2:37:21 PM
From: StockDung	Respond to of 19428

Actor Danny Aiello wars with city over plan to build movie studio on abandoned NYC property By AMY WESTFELDT .c The Associated Press NEW YORK (AP) - It seemed like a winning formula: A group of businessmen including actor Danny Aiello wanted to turn a downtrodden, city-owned stretch of harborfront into a movie studio. The group promised to keep film rolling in a city struggling to keep its $5-billion-a-year industry from migrating to Canada. And residents of Staten Island, where an old Navy repair facility sat neglected for eight years, were thrilled that a bit of star power was coming to their borough, an island south of Manhattan. ``It would sort of be a little Hollywood East,'' said City Councilman Michael McMahon. But a year after then-Mayor Rudolph Giuliani gave Aiello's firm, Stapleton Studios, a permit to build on the old Staten Island Homeport, the deal has collapsed amid charges of incompetence and fraud. The city evicted the studio owners; the group refused to go and is suing. The whole ordeal has brought Aiello publicly to tears. ``To hear yourself in a certain way be called a thief ... He has the right to sit there and call me an amateur?'' an emotional Aiello said of Andrew Alper, president of the city's Economic Development Corp., at a City Council hearing in November. ``None of us who have built this edifice should ... be ashamed.'' The group was awarded a six-month permit in January to develop the Homeport, a collection of two-story buildings near a freight rail line and modest homes on the waterfront of Staten Island's Stapleton neighborhood. In June, the city extended the permit for another four months. The business group presented a proposal that included plans to build a marina and hotel along with a sound stage. The studio would join Silvercup Studios and Kaufman-Astoria Studios in the borough of Queens, where shows like ``Sex and the City'' and ``The Sopranos'' are filmed, as a major indoor film center in the city. The studio team includes Aiello - who's appeared in more than a dozen films, including ``Do the Right Thing'' and ``Moonstruck'' - Bob DeMilia and Marlowe Walker, said its attorney, Dan Marotta. The group spent nearly $2 million to build an indoor stage, he said, and at least two productions have filmed there, including ``Max and Grace,'' starring Lorraine Bracco. But the city's Economic Development Corp. lost confidence in the group earlier this year, spokesman Michael Sherman said. Stapleton Studios failed to obtain the needed construction permits and insurance to renovate the space, he said, and it presented the names of three investors as partners who later said they had nothing to do with the project. In addition, Sherman said, the group never presented the paperwork to prove they had the $150 million needed to pull off the deal. ``They would show us different documents that were in no way what any business professional would call a proof of financing,'' Sherman said. ``It was written on their own stationery.'' The city also learned this summer that Walker's son, Bob, had been convicted of stock fraud. Bob Walker represented himself as a partner in the venture at several meetings, Sherman said, although Marotta said Bob Walker was only an employee. ``We generally do not do business with people with felony convictions,'' Sherman said. Aiello and his partners declined to speak with The Associated Press. Marotta said the partners did present paperwork guaranteeing financing as long as the city guaranteed the company some security. ``Our financiers have always taken the position that the funding was available and it was conditional upon development of a long-term lease,'' he said. Stapleton Studios sued the city after the lease was terminated, alleging it had no good reason to do so. A judge granted the company a temporary restraining order that allows it to do business. A court date has not been set. Meanwhile, Paramount Pictures has pulled out of a plan to film a movie starring Jack Black at the studio. 12/26/02 13:43 EST