Business Digest

BUSINESS DIGEST

June 09, 2005

In the Region

CitiFinancial to close Owings Mills office

CitiFinancial, the Baltimore-based consumer lending division of Citigroup Inc., will close an Owings Mills center that handles loan defaults and has about 110 employees.

The layoffs - scheduled for the last two weeks of July, according to Maryland Department of Labor, Licensing and Regulation - are part of a consolidation that included the closing last year of a back-office support center with 116 workers in Hanover. The jobs were consolidated at centers in Charlotte, N.C., Dallas and Phoenix.

Md. to appeal ruling on predatory lending

Charles W. Turnbaugh, Maryland's commissioner of financial regulation, plans to appeal a federal court ruling that found a Maryland predatory-lending law can't be applied to national banks operating in the state.

National City Corp., a Cleveland bank, filed the case after its practice of collecting prepayment penalties, which are limited under Maryland law, was questioned by Turnbaugh's office. The penalties are assessed when homeowners pay off their mortgages early.

U.S. District Judge Catherine C. Blake sided with National City in her ruling in April. Turnbaugh filed a notice of appeal last week to the U.S. 4th Circuit Court of Appeals in Richmond, Va.

MuniMae to pay $67 million for mortgage banker

Municipal Mortgage & Equity LLC, the Baltimore real estate financier known as MuniMae, said yesterday that it would buy Glaser Financial Group Inc., a commercial mortgage banker, for $67 million in cash and stock.

MuniMae will add Glaser's $3.5 billion portfolio to its $11.9 billion in assets under management. Glaser, based in St. Paul, Minn., mostly finances apartment buildings and has expertise in housing for the elderly, said Michael L. Falcone, MuniMae's chief executive.

Elsewhere

Deadlocked Scrushy jury gets four-day weekend

Deadlocked jurors began a four-day weekend yesterday after failing again to reach a verdict in the trial of HealthSouth Corp. founder Richard M. Scrushy, who is accused of fraudulently orchestrating a $2.7 billion overstatement in earnings.

The jury, which has deliberated for 12 days and has been impaneled since Jan. 25, won't return until Monday because at least two members had vacation trips scheduled that were paid for in advance, court officials said.

Meanwhile, HealthSouth said yesterday that it had reached an agreement with the Securities and Exchange Commission to pay $100 million to settle securities charges related to a $2.7 billion accounting fraud that occurred under the company's former management. The settlement follows refinancing agreements last year with bondholders and a $325 million settlement in December with the Justice Department on charges of overbilling Medicare.

Diller's IAC selling stake in Vivendi for $3.4 billion

Barry Diller's Internet conglomerate IAC/InterActiveCorp said yesterday that it is selling its stake in Vivendi Universal Entertainment for $3.4 billion, ridding the billionaire investor's company of a convoluted relationship as it gears up to enter the lucrative online search engine market.

The buyer of IAC's 5.4 percent stake in Vivendi is NBC Universal, which runs the television, theme parks and movie divisions that General Electric Co. owns

14 brokerage companies to pay $34 million in fines

Fourteen brokerage companies, including six subsidiaries of embattled insurance company American International Group Inc., and a mutual fund distributor have agreed to pay more than $34 million in civil fines in deals with industry regulators concerning payments they received to push certain mutual funds.

The companies reached settlements with the National Association of Securities Dealers, the brokerage industry's self-policing organization.

This column was compiled from reports by Sun staff writers, the Associated Press and Bloomberg News.

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