The daily business briefing: December 20, 2016
IMF's Lagarde keeps her job despite negligence conviction, Platinum Partners hedge funders charged with fraud, and more
Christine Lagarde convicted but will stay on as IMF chief
France's Court of Justice of the Republic on Monday convicted Christine Lagarde, the head of the International Monetary Fund, of negligence charges linked to the misuse of public funds when she served as France's finance minister. Lagarde was accused of not trying to block a fraudulent 2008 arbitration award to politically connected tycoon Bernard Tapie. The court did not impose a fine or sentence. The IMF's executive board said it had "full confidence" in Lagarde to stay on in her position. Lagarde said she was dissatisfied with the court's ruling but would not appeal, because "there's a point in time when one must stop, turn the page, and move on."
Hedge fund executives charged with securities fraud
Brooklyn federal prosecutors on Monday charged five people with ties to the Platinum Partners hedge fund, including founder Mark Nordlicht, in a $1 billion securities fraud indictment. Prosecutors said the suspects knew one of the company's chief funds was in financial trouble as early as 2012, but they tried to keep it afloat. Investigators say the suspects allegedly defrauded investors by misrepresenting the company's health and overvaluing its largest assets, turning their operation into one of the largest alleged scams since Bernard Madoff's notorious Ponzi scheme.
Trump picks billionaire businessman as Army secretary
President-elect Donald Trump on Monday announced that he was nominating billionaire businessman Vincent Viola as Army secretary. Viola, an Army veteran and 1977 graduate of the U.S. Military Academy at West Point, founded an electronic trading firm and later bought the Florida Panthers hockey team. He also provided funding for the Combating Terrorism Center after the Sept. 11, 2001, terrorist attacks. Trump praised Viola as "a man of outstanding work ethic, integrity, and strategic vision, with an exceptional ability to motivate others." Viola has pressed for an innovative approach to cyber warfare, saying, "We've got to find geeks who love their country."
Obama reportedly plans to block offshore oil leases in parts of Arctic and Atlantic
President Obama could block the sale of new offshore drilling rights in much of the U.S. Arctic and parts of the Atlantic as soon as Tuesday, Bloomberg reported, citing two people familiar with the matter. Obama can do it by invoking a provision in a 1953 law letting him withdraw U.S. waters from future oil and gas leasing, although the law has been used sparingly to preserve such things as coral reefs and marine sanctuaries. The move comes in the last month of Obama's presidency as environmentalists call for enacting protections before President-elect Donald Trump, who has vowed to ease environmental regulations on business, takes office.
Yellen tells graduates they are entering 'strongest job market' in years
Federal Reserve Chairwoman Janet Yellen emphasized her satisfaction with hiring trends in a speech at the University of Baltimore on Monday, telling graduates that they were "entering the strongest job market in nearly a decade." Yellen noted that the unemployment rate for college graduates was just 2.3 percent last month. "Economists are not certain about many things, but we are quite certain that a college diploma or an advanced degree is a key to economic success," Yellen said. She did not provide hints of the Fed's plans on interest rates, but her comments supported recent signs that Fed policy makers are increasingly pleased with the economy's improvement.