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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Church: Barclays ‘let down society’

Category : World News

The Church of England has criticised the conduct of Barclays in its annual report, after a year dogged by scandal and resignations at the bank.

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Enron chief set for reduced sentence

Category : Business

The former boss of scandal-hit Enron, Jeffrey Skilling, is set to have up to 10 years taken off his prison sentence.

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Food scares, the big four and F1: Justin King of Sainsbury’s on the retail race

Category : Business

The supermarket boss insists that he only wants to overtake Asda – but the Grand Prix rumours won’t go away

As the horsemeat scandal reached its peak in February, the bosses of Britain’s biggest supermarkets and suppliers were summoned to Whitehall to explain themselves.

Packed into a Defra meeting room on a Saturday morning, the shopkeepers were given an almighty dressing down and ordered to take responsibility for one of the biggest food adulteration revelations of recent years.

Among them was Justin King, at 51, and after nearly a decade at the helm of Sainsbury’s, regarded as the elder statesman of the grocery business. He was, he says, determined not to take the criticism lying down. He accused government officials of failing to understand the industry, and even threatened to call on the prime minister to demand a ceasefire.

Three months on, with horsemeat found in beefburgers, bolognese sauces, lasagnes and corned beef – but not in any Sainsbury’s products – King still recalls the behaviour of those running the country with exasperation.

He said: “That moment was when politics and business were at their most tense, because politicians felt they had to be saying something. The reason no one was saying anything was because we were doing the responsible, trustworthy thing, which is understanding the issue before we shouted about it, while the dynamic of politics is the opposite.

“In business, we understand it and then we talk about it, while in politics they talk about it and at some later date work out whether their understanding fits with what they said about it some weeks before.”

It was perhaps surprising that King wanted to take such an active role in tackling the scandal on behalf of the industry, given that his own supermarket group had come through unscathed while bitter rivals Tesco and Asda were caught out.

But the new old man of retail, having worked for PepsiCo, Marks & Spencer and Asda before his nine years at Sainsbury’s, says he has seen far worse and that the public is not quite as worried about horsemeat as might be expected.

“We’ve had foot and mouth, bird flu and BSE, all of which were examples where the supply chain was challenged, so this is nothing new. It’s all about trust and acting in a trustworthy way.

“People are pretty realistic. If you Google horsemeat, [a lot of the hits] are horsemeat jokes. So there was an immediate juxtaposition in the consumers’ minds that it was serious but they got a lot of enjoyment from it, too.”

However, King is keen to stress that businesses must stop feeling sorry for themselves and realise that the customers are victims too.

“I don’t think it is fair enough for retailers affected to say they were victims. I had a very simple view – which is that I’m on the same side of the table as the customer.

“The second you say you’re a victim in this situation, even when you are, you put yourself on the wrong side of the table. The real victims are the consumers, who have paid their hard-earned cash.”

This week, the City will see that Sainsbury’s has been largely unaffected by the scandal. Full-year results released on Wednesday will show sales up 4.6% to around £25.6bn, with underlying pre-tax profits expected to be up 5% to £748m.

The focus may now have moved away from horsemeat, but City investors will be keen to learn more about King’s future. He has been touted as the next boss of Formula One, when Bernie Ecclestone hands over the keys to the world’s most glamorous sporting franchise.

Last weekend that speculation reached a new pitch after the supermarket confirmed that headhunters Egon Zehnder had been retained to advise on King’s successor. Sources inside the company suggest the process could take a year and that the process is merely a matter of good management.

King refuses to quash rumours that he is interested in the F1 job – he only ever says that he is “not aware of a vacancy”. He is a huge racing fan and has helped his son Jordan to become one of the most promising drivers of his generation.

But if the call from Ecclestone, F1′s diminutive owner, fails to come, a career in politics might appeal.

King is a former board member of the London Organising Committee of the Olympic and Paralympic Games, and was a member of David Cameron’s business advisory group – before they fell out over King’s objections to government plans to allow new staff to surrender employment rights in exchange for shares.

However, poor pay in the public sector could prove a sticking point for the businessman, who earned £3m last year – 20 times more than the PM.

On the subject of King’s future, analysts at Barclays wrote: “No CEO remains forever, and at some point Justin King will prove the press predictions correct and move on. However, he may be keen to be in charge when Sainsbury’s regains its number two market-share position from Asda – his former employer.”

That could happen later this year, after a remarkable 33 consecutive quarters of growth.

According to industry data from Kantar Worldpanel, Sainsbury’s is outperforming its rivals as the only big four supermarket to be increasing its market share. The grocer now accounts for nearly 17% of all the money spent on groceries in the UK, a slight rise on last year, at a time when Morrisons, Asda and Tesco all lost customers.

Sainbury’s successful Paralympics sponsorship, leading position in convenience stores and growing online presence have also helped, while Tesco’s decision to open no more megastores, and write off £800m on land it had bought for new developments but will now never use, may also give King cause to crow.

He was always angry about Tesco’s land-grab. “If you’re acquiring a site just a mile from an existing site, are you doing it because you think it’s valuable to trade, or because it stops a competitor?”

And his vitriol for the number one supermarket doesn’t stop there. He is equally scathing about Tesco’s new price promotion, which promises shoppers that Tesco’s prices for own-label and branded goods are cheapest. Having complained directly to Tesco and failed to reach a compromise, Sainsbury’s has now appealed to the Advertising Standards Authority. “We have exhausted everything we could with them [Tesco], so were left with no choice but to go to the ASA,” he says.

“You can’t have advertising saying that where your chicken comes from is important, while at the same time still sourcing your chicken from Thailand and Brazil, and then doing a price comparison with Sainsbury’s chicken, which is sourced from the UK. That is inherently unfair.”

Tesco said: “We use an independent agency to check prices of branded and own-label products at other retailers – online daily for Asda and Sainsbury’s, and, since they don’t have an online grocery service, twice a week at Morrisons stores. The basis for our comparisons is made clear on the price promise website.”

This may not be enough to soothe King’s feelings, but perhaps he will soon be directing his passions elsewhere. Less horsemeat, more horsepower?

Swiss bank UBS returns to profit

Category : Business

Swiss bank UBS returned to profit in the first three months of the year, after racking up big losses related to the Libor scandal at the end of 2012.

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Bird flu eats up Yum profits in China

Category : Business, Stocks

Yum said Wednesday that same-store sales in China dropped 20% in the first quarter, as it continues to grapple with the fallout from a food safety scandal and fears over a new strain of bird flu.

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Regulator surprised no bank bosses face charges over financial crisis

Category : Business

Andrew Bailey, head of Prudential Regulation Authority, says it’s odd action taken only against people lower down in failed banks

Britain’s most senior banking regulator has questioned why none of the bosses of the country’s failed banks have been formally charged over their roles in the financial crisis. Andrew Bailey, head of the new banking regulator, the Prudential Regulation Authority, said: “It is more than odd that action has been taken against people lower down in institutions, but no action has been taken at the top.”

At a conference debating how to rebuild trust in Britain’s scandal-hit banks, Bailey said it was a “source of surprise” that no senior bank directors have been disqualified. He pointed out that the secretary of state sought the disqualification of Barings Bank for their roles in failing to adequately supervise Nick Leeson.

Chuka Umunna, the shadow business secretary, said bankers caught trying to play the system in order to line their own pockets should be “thrown into jail”.

He said it “cannot be right” that benefit cheats who fiddle the system for a couple of hundred pounds are thrown into jail while “those who seek to rig the financial system and receive hundreds of thousands of pounds as a result never seem to suffer the same fate”.

In an impassioned speech at the Future of Financial Services summit in Canary Wharf on Monday, Umunna said the City would not be able to rebuild trust with society “until custodial sentences are imposed on those guilty of criminal wrongdoing in your sector”.

He said the “prospect of jail for gross wrongdoing” was one of the best ways to affect cultural change in Britain’s scandal-hit banks.

No bankers have been jailed in connection with the Libor rate-fixing scandal, but the Serious Fraud Office (SFO) has launched a criminal investigation and arrested three men. In the US, two former UBS employees have been charged.

Umunna acknowledged that politicians were hardly in the best position to lecture others on trust and morals. “We are less popular than you and we learned the hard way after the expenses scandal, when we had to get our house in order,” he said. “But at least the people saw politicians brought to book – with some of our number serving jail time for their wrongdoing.”

He also attacked Barclays for trying to sneak out news that it paid its bosses bonuses of £39.5m on budget day. Umunna said it “sent all the wrong messages”.

Ashok Vaswani, boss of retail and business banking at Barclays, who was also at the debate, admitted that the timing of the release was “a mistake”.

Labour will on Tuesday resume its push for changes to banking reforms going through parliament, calling for stronger immunities for whistleblowers.

In Tuesday’s parliamentary debate, Labour will table amendments to the bill to protect whistlebowers as well bolster protection for customers of savings schemes such as Farepak, which collapsed in 2006.

Labour will also produced figures showing that the government’s levy on balance sheets has brought in £2bn of revenue less than originally forecast.

Chris Leslie, a shadow Treasury minister, also intends to call for a full licensing review of bankers. “If a GP or a barrister was involved in serious misconduct, they would have to answer to the BMA or Bar Council ethical practice committees and could lose their licence – and so we also need similar processes for those who break financial regulations too,” Leslie said.

France’s Hollande fights tax scandal

Category : World News

A financial scandal threatens France’s President Hollande, after it emerged that his former party treasurer invested in the Cayman Islands tax haven.

Excerpt from: France’s Hollande fights tax scandal

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Barclays report blames bank culture

Category : Business

Barclays became too focused on short-term profit and bonuses in the run-up to the Libor-rigging scandal, a review commissioned by the bank says.

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Tesco market share sticks below 30% after horsemeat revelations

Category : Business

Figures show ongoing depression in market share for UK’s largest supermarket in 12 weeks to 17 March

Tesco, the supermarket most heavily hit by the revelations of horsemeat scandal, is still suffering from the furore as figures showed an ongoing depression in market share.

The UK’s largest supermarket saw its share in the 12 weeks to 17 March stay below 30% – a level it last fell below eight years ago – according to data by Kantar Worldpanel.

Fraser McKevitt, a retail expert at the consumer research company, said: “People haven’t forgotten the scandal and frozen burger and ready-meal sales have still not recovered.

“However, there is certainly no overall spend decline from the horsemeat scandal. If people don’t want to buy processed meat, they are buying other proteins instead.

“I suspect Tesco has been hit a little bit by it. It is the biggest retailer in the country and was scrutinised the most. Because of its size, there was always a good chance that if a product was affected, it would be selling it.”

He added that the biggest beneficiary was Sainsbury’s, which has seen its sales increase 6.2% over the last three months compared with the same period a year earlier. Tesco saw its sales increase by 1.1%.

Sainsbury’s, the UK’s third largest supermarket, found no horsemeat in any of its own-brand products, unlike Tesco and Asda.

Morrisons was also untarnished by the horsemeat scandal, but failed to capitalise on its integrated supply chain, where it owns and runs its abattoirs, because it does not have an online presence.

McKevitt said: “Internet sales is a huge growth driver for the rest of the big four supermarkets, so Morrisons is still missing out on that.”

Supermarkets have all be reporting an increase in fresh meat sales and Asda revealed its meat-free products have been rapidly increasing.

Beyond the big four supermarkets, Waitrose also benefited from coming away relatively unscathed from the crisis – although pork was found in its frozen beef meatballs.

Its sales increased by 12.5% over the period at its fasted rate since September 2010, raking in £1.16bn in the past three months. At the other end of the spectrum, Aldi and Lidl both continued their assault for hard-pressed shoppers, increasing sales 30.8% and 10.5% respectively.

Horsemeat scandal ‘changing habits’

Category : Business

More than half of UK consumers have changed their shopping habits as a result of the horsemeat scandal, a survey by consumer group Which? suggests.

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