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UPI NewsTrack Business

March 29, 2013 at 5:00 PM   |   Comments

U.S. consumer spending rose in February

WASHINGTON, March 29 (UPI) -- Consumer spending rose 0.7 percent and incomes were up 1.1 percent in February, the U.S. Commerce Department said Friday.

Personal spending rose by $77.2 billion, with help from a $143.2 billion boost in incomes.

Disposable incomes increased by $127.8 billion, or 1.1 percent, the department said.

The figures represent a turnaround for workers, who had incomes drop by 3.7 percent and disposable incomes slide 4 percent in January.

Wages regained almost to the dollar what had been lost in January. The $42.7 billion drop in wages in January turned to a $42.4 billion gain in wages and salary disbursements in February.

Personal savings in February totaled $310.9 billion, up from $262.5 billion in January. The savings rate -- personal savings as a percentage of disposable income -- rose to 2.6 percent in February from 2.2 percent in the previous month.


SAC Capital money manager arrested

NEW YORK, March 29 (UPI) -- U.S. authorities said they arrested a SAC Capital Advisors portfolio manager in New York as part of an insider trading investigation.

The arrest of Michael Steinberg at his Park Avenue apartment makes a total of nine SAC employees implicated in the case. Four have entered guilty pleas, The New York Times reported Friday.

Steinberg's attorney Barry Berke said his client was innocent. Steinberg was caught in the crossfire of aggressive investigations of others," Berke said.

"There is no basis for even the slightest blemish on his spotless reputation," Berke said.

However, Jon Horvath, a former employee at the firm who worked for Steinberg, named him as part of an alleged insider-trading ring that involved illegal trades of technology company stock, specifically shares of Dell and Nvidia.

Horvath pleaded guilty and said he passed along confidential business information to Steinberg, who bought and sold stock based on the information.

Two other money managers tied to Horvath and Steinberg have been convicted of insider trading charges in jury trials, the Times reported.


BofA saddled with top spot in complaints

WASHINGTON, March 29 (UPI) -- Bank of America's purchase of Countrywide Financial Corp. pushed it to the No. 1 spot on a list of consumer complaints, data from a watchdog agency show.

BofA responded to the complaints data by praising the goal of transparency at the Consumer Financial Protection Agency, the watchdog agency that was created in response to the 2008 financial crisis.

BofA also pointed out that 98 percent of the complaints reported by the agency were listed as resolved.

But the data show BofA was way out in front on complaints complied since December 2011 and that its purchase of Countrywide was the principle reason.

BofA bought Countrywide in 2008, just as the financial meltdown was unfolding and the California lender at the time was the country's largest mortgage firm. Its specialty: risky, subprime mortgages.

By the numbers, the CFPA said BofA had 15,136 complaints since December 2011, about 30 percent of all complaints the agency handled. Two-thirds of the BofA complaints involved mortgage modifications, the Los Angeles Times reported Friday.

The information "enforces what we already knew – that Countrywide was a hot mess," said banking industry analyst Nancy Bush.

"The lack of infrastructure at Countrywide left Bank of America in the lurch from day one when it came to enacting the tsunami of directives that came at them [from regulators] after the meltdown," Bush said.

BofA handles 15 percent of all U.S. residential mortgages.

Wells Fargo handles a larger share of the market, servicing 21.5 percent of the country's home loans but was responsible for less than 16 percent of complaints involving mortgages.

JPMorgan Chase customers generated 10 percent of the mortgage complaints, while that firm handles 12.7 percent of the market share.

Citibank and U.S. Bancorp round out the top five, serving 5.2 percent and 2.9 percent of the market, respectively. Those banks generated 4.8 percent and 1.7 percent, respectively, of all the mortgage-related complaints, the Times said.


Hollande proposes payroll tax on wealthy

PARIS, March 29 (UPI) -- French President Francois Hollande said he would try a new approach to raising taxes on the wealthiest wage earners with a 75 percent payroll tax.

An earlier proposal to make the top tax rate in France 75 percent, which would apply to those earning more than $1,300,000 per year, was shot down by a judiciary council.

In a late-night television appearance, Hollande said he would take another approach to the problem.

"The Constitutional Council made a decision. I respect it. So, I'm going to take a different path," he said.

CNNMoney reported Friday that Hollande proposed a payroll tax, shifting the responsibility for payment from individuals to the companies where they work.

As France's economy remains in a slump, Hollande's popularity is waning. His first proposal stirred up emotions among those for and against the tax hike.

French actor Gerard Depardieu reacted to the proposal by becoming a Russian citizen and moving his residence to Belgium. That move stirred up emotions as well, with some angry and some sympathetic to Depardieu's decision.

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