Federal prosecutors are looking into whether Fox News Channel and its parent company tried to disguise a $3.15 million payment to a former employee who said she had a 20-year affair with the network’s former chairman, Roger Ailes, according to people involved with the investigation.
Investigators in the U.S. Attorney’s Office for the Southern District of New York have focused on a payment to Laurie Luhn, a former Fox booker and event planner who left the company in 2011 with the seven-figure severance package. Luhn later claimed that she had engaged in a consensual but a mentally abusive, relationship with Ailes and that several of his lieutenants facilitated the assignations and were aware of his alleged mistreatment of her.
.. A series of such payments could be considered material not because of their size but because they could raise concerns among investors about the stability of the company’s management or finances.
China’s Banks Are Hiding More Than $2 Trillion in Loans
Accounting sleight of hand means banks don’t have to set aside capital for potential losses, sowing fears of a crisis; new apartments with no residents
an “investment receivable,” a loosely regulated category of assets that allows bank officials to set aside little or nothing for potential losses... As of June, 32 publicly traded Chinese banks had a total of $2 trillion in investment receivables as of June, up from $334 billion at the end of 2011
Bank Rule Distorting Performance Is Repealed
It stated that banks could choose to value some of their liabilities, the money they owe, according to fair value. And in doing so, the accounting rule allowed a bizarre treatment when a bank was under stress. If a bank is ailing, investors have less desire to lend to the bank. As a result, the value of the bonds that the bank has issued might fall. The rule then assumed that the bank could, in theory, buy back those distressed bonds at a discount. By doing this trade, a bank would create profits for itself. The bond’s covenant might require the bank to pay back 100 cents on the dollar to its holders when it matured. But if the bank itself bought the entire bond for 70 cents on the dollar, it would avoid having to pay the bond back at 100 cents — and the 30 cents it would not now have to pay back would become a gain in its earnings statement.
.. But the rule also punished the banks’ earnings. When investors’ perceptions of a bank’s creditworthiness improved, its liabilities would in theory rise in value. As a result, a bank would make less of a gain if it bought back its own debt — and this would show up as a loss in a bank’s earnings.