A Las Vegas man has been convicted of fraud and money laundering charges in what federal prosecutors say was a $1.5 billion Ponzi scheme involving a purported investment company and medical collection business that operated in Nevada and Japan and more in Friday’s Markets In Brief.
Edwin Fujinaga faces a March 8 sentencing after a jury convicted him Tuesday of 20 counts of mail fraud, wire fraud and money laundering.
The U.S. Attorney’s Office said Fujinaga was president and CEO of MRI International Inc. and that he fraudulently solicited investments from over 10,000 Japanese residents but used little of the money as promised.
The office said Fujinaga instead used most of new investors’ money to pay off previous investors and spent the rest on things such as a mansion, a private jet, luxury cars and real estate.
MARKETS IN BRIEF
Dallas CEO Arrested in Cryptocurrency Scheme
Federal prosecutors say the CEO of Dallas-based AriseBank has been arrested in a cryptocurrency scheme that tricked hundreds of investors out of more than $4 million.
Authorities say Jared Rice Sr. was arrested Wednesday and faces multiple counts of wire fraud and securities fraud. Prosecutors say Rice claimed AriseBank could offer consumers FDIC-insured accounts and Visa-brand debit and credit cards, on top of cryptocurrency services. But they say AriseBank was not FDIC insured and “did not have any sort of partnership with Visa.”
Rice is accused of converting investor funds and spending the money on clothing, food and hotels.
Online court records tied to the case did not list an attorney for Rice.
Next US Moon Landing Will Be By Private Companies, Not NASA
America’s next moon landing will be made by private companies — not NASA.
NASA Administrator Jim Bridenstine announced Thursday that nine U.S. companies will compete in delivering experiments to the lunar surface. Bridenstine says NASA will buy the service and let private industry work out the details on getting there.
The goal is to get science and technology experiments to the surface of the moon as soon as possible. The first flight could be next year. 2019 marks the 50th anniversary of the first manned moon landing.
The announcement comes just three days after NASA landed a spacecraft on Mars. NASA wants to see how it goes at the moon before committing to commercial delivery services at Mars.
The nine companies, representing seven states, are:
Astrobiotic Technology Inc., Pittsburgh; Deep Space Systems, Littleton, Colorado; Draper, Cambridge, Massachusetts; Firefly Aerospace Inc., Cedar Park, Texas; Intuitive Machines, Houston; Lockheed Martin, Littleton, Colorado; Masten Space Systems Inc., Mojave, California; Moon Express, Cape Canaveral; and Orbit Beyond, Edison, New Jersey.
US Consumer Spending up Strong 0.6% in October
Consumers boosted their spending in September at the fastest pace in seven months, while their incomes rose by the largest amount in nine months. Both are good signs for future economic growth.
The Commerce Department says consumer spending rose a sharp 0.6 percent last month. It was the biggest increase since a similar gain in March and was three times faster than the 0.2 percent September performance. Incomes, which provide the fuel for spending, were up 0.5 percent in October, a significant pickup from a 0.2 percent September gain.
A key gauge of inflation tied to consumer spending posted a 2 percent rise in October compared to a year ago, hitting the 2 percent annual target for inflation set by the Federal Reserve.
Patagonia Gives GOP Tax Windfall to Environmental Groups
Patagonia, the outdoor gear company, is passing along the $10 million it saved from tax cuts to non-profit environmental groups.
Corporations received a windfall from the GOP’s sweeping overhaul of the U.S. tax code last year, which slashed corporate rates from 35 percent, to 21 percent.
The California company said Wednesday that the donation is in addition to 1 percent of sales it gives to environmental groups every year. The donation is being made on the heels of the recent National Climate Assessment, which Patagonia cited in its announcement.
“Our government continues to ignore the seriousness and causes of the climate crisis. It is pure evil,” said Yvon Chouinard, Patagonia’s founder. “We need to double down on renewable energy solutions. We need an agriculture system that supports small family farms and ranches, not one that rewards chemical companies intent on destroying our planet and poisoning our food. And we need to protect our public lands and waters because they are all we have left.”
The report warned that natural disasters are worsening in the U.S. because of global warming. It said violent weather and floods have led to costs of nearly $400 billion since 2015 and the potential for annual losses hundreds of billions of dollars.
Though economists agree with the general financial conclusions related to climate change, President Donald Trump has rejected the report’s assessment regarding the potential economic impact.
Patagonia, based in Ventura, California, has joined a flurry of lawsuits challenging Trump’s decision to chop up two large national monuments in Utah. It also endorsed Democratic Sens.-elect Jon Tester of Montana and Jacky Rosen of Nevada, both who won against GOP incumbents. The company described them as champions of public lands and the outdoor industry.
US Average Mortgage Rates Steady; 30-Year Stays at 4.81%
U.S. long-term mortgage rates barely budged this week after marking the biggest drop in nearly four years a week earlier.
Home borrowing rates remain much higher than they were a year ago. Mortgage giant Freddie Mac says the average rate on the benchmark 30-year, fixed-rate mortgage held steady at 4.81 percent this week. That compares with 3.90 percent a year ago.
The rate on 15-year fixed-rate loans edged up to 4.25 percent from 4.24 percent the previous week.
US Pending Home Sales Fell 2.6% in October
Fewer people signed contracts in October to purchase homes, as higher mortgage rates have worsened the affordability and dampened enthusiasm among would-be buyers.
The National Association of Realtors said Thursday that its pending home sales index fell 2.6 percent last month to 102.1. The index based on contract signings has tumbled 6.7 percent from a year ago.
The housing downturn has corresponded with a jump in mortgage rates that began last year after President Donald Trump’s tax cuts led to higher budget deficits and interest rates charged on U.S. Treasury notes. Further fueling the increase mortgage rates was a decision by the Federal Reserve to reduce the size of its balance sheet and raise a short-term rate for loans between banks.
Mortgage buyer Freddie Mac said the average rate charged for a 30-year mortgage was 4.81 percent this week, up from 3.90 percent last year.
Contract signings dropped most sharply in the West, but they also declined in the Midwest and South. The index increased in the Northeast.
Pending sales are a barometer of home purchases that are completed a month or two later, so the October index suggests that sales will possibly decline through December.
US and UK Strike Deal to Preserve Air Service After Brexit
The United States and United Kingdom have reached an agreement to maintain air service between the two countries after Brexit.
U.K. Transport Secretary Chris Grayling confirmed the so-called open-skies agreement on Wednesday.
The deal will maintain the same access to the U.S. that planes flying from the U.K. enjoy under the current U.S.-Europe air treaty. The U.K. will no longer be under that U.S.-Europe treaty after it leaves the European Union.
Airlines for America, a trade group representing most big U.S. airlines, is praising the agreement, saying it will ensure the continuation of key transatlantic routes.
Flights between the two countries carry about 20 million passengers a year, accounting for nearly one-third of all air travel between the U.S. and Europe.
MillerCoors, Pabst Settle Lawsuit Over Brewing Contract
MillerCoors and Pabst Brewing Co. have settled a lawsuit in which the hipster’s brand of choice claimed the bigger brewer lied about its ability to continue brewing Pabst’s beers to put that company out of business.
The settlement came Wednesday as jurors were in deliberations.
Chicago-based MillerCoors said in a statement the settlement was “amicable” and that all “outstanding issues with Pabst” were resolved. Settlement details were not disclosed.
MillerCoors has brewed and shipped most of Pabst’s beers since 1999. Pabst, which was founded in Milwaukee but now based in Los Angeles, sued in 2016 after MillerCoors announced it wouldn’t have the capacity to brew for Pabst when the contract expired in 2020.
Pabst claimed that the contract allowed for two five-year extensions if Pabst wanted and that MillerCoors was worried Pabst would cut into its market share. MillerCoors called the claim a conspiracy theory.
Dollar Tree: Fiscal 3Q Earnings Snapshot
Dollar Tree Inc. (DLTR) on Thursday reported fiscal third-quarter net income of $281.8 million.
The Chesapeake, Virginia-based company said it had net income of $1.18 per share.
The results topped Wall Street expectations. The average estimate of 10 analysts surveyed by Zacks Investment Research was for earnings of $1.15 per share.
The discount retailer posted revenue of $5.54 billion in the period, which fell short of Street forecasts. Seven analysts surveyed by Zacks expected $5.55 billion.
For the current quarter ending in January, Dollar Tree said it expects revenue in the range of $6.1 billion to $6.21 billion. Analysts surveyed by Zacks had expected revenue of $6.26 billion.
The company expects full-year earnings to be $4.86 to $4.95 per share, with revenue ranging from $22.72 billion to $22.83 billion.
Dollar Tree shares have declined 22 percent since the beginning of the year, while the Standard & Poor’s 500 index has increased roughly 3 percent. The stock has declined 17 percent in the last 12 months.
Abercrombie: Fiscal 3Q Earnings Snapshot
Abercrombie & Fitch Co. (ANF) on Thursday reported fiscal third-quarter earnings of $23.9 million.
On a per-share basis, the New Albany, Ohio-based company said it had profit of 35 cents. Earnings, adjusted for non-recurring gains, came to 33 cents per share.
The results topped Wall Street expectations. The average estimate of eight analysts surveyed by Zacks Investment Research was for earnings of 18 cents per share.
The teen clothing retailer posted revenue of $861.2 million in the period, also surpassing Street forecasts. Seven analysts surveyed by Zacks expected $854.2 million.
Abercrombie shares have fallen nearly 2 percent since the beginning of the year. The stock has declined slightly more than 3 percent in the last 12 months.
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