* FTSEurofirst 300 index rises 0.5 percent in early trade
* Financials stocks lead market rally
* Hopes that central banks deal with any Greek vote fallout
LONDON, June 15 (Reuters) - European shares advanced on Friday as financial stocks rose on expectations of new central bank measures to deal with the risk of a Greek exit from the euro zone.
The FTSEurofirst 300 index was up 0.5 percent at 987.46 points by 0745 GMT. Germany's DAX was up 0.9 percent, while France's CAC-40 index rose 1 percent.
Investors are wary ahead of elections in Greece on June 17, which could determine the future of the debt-ridden country in the euro zone currency bloc.
Officials from G20 nations told Reuters on Thursday that central banks were ready to take steps to stabilise financial markets, if needed, by providing liquidity and preventing any credit squeeze after Sunday's election.
The signal that world authorities were ready to take steps to prevent any worsening of Europe's debt crisis supported European financial shares on Friday, which have fallen sharply in recent weeks due to their exposure to Greece.
The STOXX 600 European bank index rose 1.6 percent, while the European insurance index gained by 1.3 percent.
However, Securequity sales trader Jawaid Afsar said he would be tempted to sell off shares later on Friday, in order to minimise any hits to portfolios in case of any unforeseen outcomes from the Greek election.
"If you're already in the rally, you should use the rally to start closing out your positions to reduce the risk ahead of Sunday," he said.
JN Financial trader James Fogden also said the European equities market rally could peter out later in the day, with an expiry of options contracts due at 1000 GMT also likely to make the trading session a volatile one.
"We could see a bit of a pull-back later," he said.
The FTSEurofirst has been within a tight trading range between 970 and 990 points established in early May, and traders said it was likely to remain in that range while uncertainty over the euro zone debt crisis persisted. (Reporting by Sudip Kar-Gupta; Editing by Louise Ireland)
Ex-Business Titan Rajat Gupta Guilty of Insider Trading - Daily Finance
By Grant McCool and Basil KatzNEW YORK -- Rajat Gupta, a consummate business insider who once sat on the board of Goldman Sachs Group, was convicted on Friday of leaking secrets about the investment bank at the height of the financial crisis, a major victory for prosecutors seeking to root out insider trading on Wall Street.
The Manhattan federal court jury delivered its verdict on its second day of deliberations, finding that Gupta had fed stock tips to his hedge fund manager friend Raj Rajaratnam, which he had gleaned from confidential Goldman board meetings.
Gupta is also a former director at Procter & Gamble and a former executive at the elite business consulting firm McKinsey & Co. He is the most prominent person convicted in the government's crackdown in the last few years on illicit trading involving hedge funds and financial consultants.
The 63-year-old Gupta was found guilty of three counts of securities fraud and one count of conspiracy. The jury acquitted him on two other securities fraud charges.
He could receive up to 25 years in prison. The maximum sentence for securities fraud is 20 years and the maximum sentence for conspiracy is five years, though it seems unlikely that he would receive such a heavy punishment. Rajaratnam was convicted of 14 counts of securities fraud and conspiracy last year and is serving an 11-year prison term.
After the verdict, an ashen-faced Gupta glanced grimly back at his wife and four daughters in the courtroom. Later, the family stood hugging each other in the courtroom as Gupta tried to console his distraught daughters.
His defense lawyer, Gary Naftalis, said Gupta is likely to appeal.
Since being implicated in the Rajaratnam case more than a year ago, Gupta has denied the charges. In addition to his business background, the Indian-born Gupta was known for his work with philanthropies fighting AIDS, malaria and tuberculosis in developing countries.
"I wanted to believe the allegations weren't true," said Lepkowski, a nonprofit group executive from Ossining, New York. "At the end of the day, when all of the evidence was in, it was in my opinion, overwhelming."
Among the most dramatic contentions against Gupta was prosecutors' charge that he had told Rajaratnam about a crucial $5 billion injection into Goldman by Warren Buffett's Berkshire Hathaway at the height of the financial crisis.
Part of the prosecution's evidence was that within a minute of disconnecting from a Sept. 23, 2008 board call approving the investment, Gupta called Rajaratnam at his Galleon Group office in New York. Rajaratnam then hurriedly ordered his traders to buy as much as $40 million in Goldman stock because only minutes remained before the market closed.
At trial, Gupta's lawyers argued that prosecutors "had no real, hard, direct evidence" against Gupta, who did not take the witness stand.
U.S. District Judge Jed Rakoff has set sentencing for Oct. 18.
The case is USA v Gupta, U.S. District Court for the Southern District of New York, No. 11-907.
Morning business round-up: ECB ready to act 'if necessary' - BBC News
What made the business news in Asia and Europe this morning? Here's our daily business round-up:
Continue reading the main storyThe European Central Bank (ECB) said it is ready to provide further support ''if necessary'' to the eurozone's banking system.
Its president Mario Draghi said: "The eurosystem will continue to supply liquidity to solvent banks where needed."
A general election in Greece on Sunday has heightened fears of further instability on financial markets.
Greece saw a major retailer, France's Carrefour, pull out of the country.
The French retail giant said it was selling its stake in its Greek joint venture owing to fears about Greece's deteriorating economic situation.
It is selling to partner Marinopoulos, and will take a financial charge of about 220m euros (£179m; $278m) on the deal.
In a statement, the company said the move was in response to "challenges posed by the Greek economic context".
Carrefour's shares rose 1.68% following the announcement.
Still in Europe, new EU car registrations slumped.
Demand for new passenger cars fell sharply across the European Union in May, reflecting weak consumer confidence in the wake of the financial crisis.
The European Automobile Manufacturers' Association said new car registrations totalled 1,106,845 vehicles, down 8.7% compared to the same month last year.
France led the decline with a 16.2% market contraction, closely followed by Italy, which fell 14.3%.
Only the UK market grew, rising 7.9%.
Meanwhile, in the UK, its central bank acted to try to boost confidence and lending against a backdrop of failing business nerve in the face of the eurocrisis.
UK bank shares jumped on the stimulus move.
The Bank of England's plan, announced late on Thursday, came in response to the worsening economic outlook, its governor Sir Mervyn King said.
Together with the government, it will provide billions of pounds of cheap credit to banks to lend to companies.
Business headlines
To Asia now, where Coca-Cola announced it would start business again in Burma.
It has been 60 years since it last operated there and its return follows a US decision to suspend investment sanctions against the country.
Officials suspended the sanctions last month as the country has moved towards democratic reforms.
Coca-Cola is waiting for a licence from the US government.
The country was one of only three that Coca-Cola does not do business with.
And as Burma opens up to international business, the latest Business Daily podcast reports from Rangoon, and asks if Burma is set to become a new Asian Tiger, or whether the legacy of 50 years of mismanagement is too great an obstacle.
U.S. targets financial abuse of elderly - Los Angeles Times
Americans over 60 lost at least $2.9 billion in 2010 to financial exploitation — ranging from simple home repair scams to complex insurance swindles. That figure was up 12% from 2008, according to a study released Thursday by MetLife Mature Market Institute, the National Committee for Prevention of Elder Abuse and Virginia Tech University.
The rise in abusive tactics led the Consumer Financial Protection Bureau to begin looking into the types of scams affecting older Americans and coming up with the best ways to prevent them. A specific focus will be on the credentials of people who tout themselves as financial advisors.
"The silent crime of financially exploiting the elderly is widespread, and it is devastating. It is critical for us to act," Richard Cordray, the agency's director, said at a White House forum Thursday ahead of World Elder Abuse Awareness Day.
"The generation that rebuilt and sustained this nation out of a devastating Depression, the dark hours of World War II and the anxious fears of the Cold War deserve our care now," Cordray said.
Tougher oversight by regulators is needed to prevent financial predators from preying on vulnerable elderly victims, said Patricia L. McGinnis, executive director of California Advocates for Nursing Home Reform, a San Francisco group that often deals with financial abuse.
"The bottom line is, you need to go after the predators. You need to punish them and you need to convict them," she said. "Put them in jail and make an example of them, but more importantly, get the money back for that victim. Make them whole again."
McGinnis described efforts by regulators and advocates to prevent the scamming of older Americans as a game of Whac-A-Mole.
A recent scam enticed senior citizens to put large amounts of savings into deferred annuities, reducing their savings to qualify for a particular federal veterans benefit. The veteran might get $1,000 a month from the benefit, but loses access to the cash for years. Meantime, the annuity salesperson earned a commission of 8% to 12%, she said.
Victims often are reluctant to fight back.
"I can't tell you the times I talk to people and they say, 'It was my own fault,'" McGinnis said. "They are very embarrassed."
The scams have increased as the economy has struggled. Survey results released this week by the nonprofit Investor Protection Trust found that 84% of experts who deal with financial exploitation of the elderly said the problem has worsened.
But there is a lack of comprehensive information on the problem, which the consumer bureau's inquiry could help solve, said Elizabeth Costle, director of the consumer and state affairs team at the AARP Public Policy Institute.
Financial predators often target the elderly because they are viewed as gullible, Cordray said.
"Many seniors have routines, and their predictable patterns make them easier targets for predators," Cordray said. "Abusers often assume that the victim will be too embarrassed or too frail to pursue legal action against them, and unfortunately that assumption is too often proven to be correct."
The agency's inquiry seeks comments from the public on several issues. They include detailing the unfair, deceptive and abusive practices targeted at the elderly, finding the types of financial planning resources, and evaluating the credentials of financial advisors. The agency will be accepting public comments until Aug. 13.
Cordray said that some people who tout themselves as experts on elderly financial issues have had only a few hours of inadequate training.
"We need to distinguish between the true experts and those engaged in predatory conduct," he said.
The qualifications of financial advisors are important as new retirees must decide what to do with lump-sum 401(k) payouts and often must juggle many complex options, Costle said. The ability to understand those options gets more difficult as people age.
"As people get older, particularly up into their 80s ….they're just less able to process financial information," she said. "They're more likely to be trusting of people and they open themselves up to more abuse, which is perpetrated both by strangers and by caregivers and family members who are close to them."
Congress and the White House have increased their focus on the issue.
Lawmakers included the Elder Justice Act in the 2010 healthcare reform law to coordinate federal efforts. As part of the law, Health and Human Services Secretary Kathleen Sebelius on Thursday announced $5.5 million in grants to states to "test ways to prevent elder abuse, neglect and exploitation."
Ex-business titan Gupta guilty of insider trading - Reuters
NEW YORK |
NEW YORK (Reuters) - Rajat Gupta, a consummate business insider who once sat on the board of Goldman Sachs Group Inc, was convicted on Friday of leaking secrets about the investment bank at the height of the financial crisis, a major victory for prosecutors seeking to root out illicit trading on Wall Street.
A Manhattan federal court jury delivered the verdict on its second day of deliberations, finding Gupta fed stock tips to his hedge fund manager friend Raj Rajaratnam gleaned from confidential Goldman board meetings. He was found guilty of four of six criminal counts and could face a prison term of up to 25 years.
The conviction burnishes the record of the U.S. Attorney's Office in Manhattan, which has spent the last several years aggressively prosecuting insider trading. More than 60 people have pleaded guilty or been convicted in cases brought by the FBI and the Manhattan U.S. Attorney in the past four years.
In its case against Gupta, who headed elite business consultancy McKinsey & Co for nine years and is the most prominent person charged in the insider-trading crackdown, the government faced a challenge. There was no evidence he traded on any of the information he allegedly leaked and the government did not have the trove of FBI wiretaps that helped win a conviction of Rajaratnam a year ago.
Jury foreman Rick Lepkowski told reporters after the verdict: "On the counts we convicted, we felt there was enough circumstantial evidence." He said wiretaps in which Rajaratnam was heard telling two of his traders about the board information "didn't tip the balance."
The verdict capped a four-week trial that featured Goldman CEO Lloyd Blankfein as a star government witness. All of the counts Gupta was convicted of involved tips and trades in Goldman stock in September and October 2008, including passing inside information on a crucial $5 billion investment by Warren Buffett's Berkshire Hathaway Inc.
As the verdict was read in court by the jury foreman, there was a gasp when Gupta was pronounced "not guilty" on the first count of securities fraud. It involved whether Gupta told Rajaratnam about Goldman's quarterly earnings after a March 12, 2007 board meeting. He was then declared guilty on three other securities fraud counts and a count of conspiracy.
Gupta, 63, was also found not guilty of divulging the quarterly earnings in January 2009 of Procter & Gamble Co, where he also served as a board member.
After the verdict, an ashen-faced Gupta glanced grimly back at his wife and daughters. Later, the family stood together hugging in the courtroom as Gupta tried to console his distraught, sobbing daughters and wife.
"This is only Round One," his defense attorney, Gary Naftalis, told reporters. "We will be moving to set aside the verdict and will, if necessary, appeal the conviction."
Gupta, who lives in Westport, Connecticut, is also a former director at American Airlines Corp and had ties to a prominent business school in his native India. Well known in philanthropic circles, he advised groups such as the Bill & Melinda Gates Foundation to help fight AIDS, malaria and tuberculosis in developing countries.
Jury foreman Lepkowski said he was impressed by Gupta's "storybook life" up to the time of the allegations and his family's support.
"I wanted to believe the allegations weren't true," said Lepkowski, 51, a non-profit group executive from Ossining, New York. "At the end of the day, when all of the evidence was in, it was in my opinion, overwhelming."
Another juror, child welfare worker Ronnie Sesso, 53, said the jury, which also included a nurse, a teacher and a school counselor, struggled to determine what Gupta's motive might have been in passing tips to Rajaratnam.
"Gupta was a true friend," she said. "Raj was a snake in the grass."
Since being implicated in the Rajaratnam case more than a year ago, Gupta has denied the charges. His lawyers said Rajaratnam cheated Gupta out of $10 million and the two men had a falling out in 2008. They argued that prosecutors "had no real, hard, direct evidence" against Gupta, who did not take the witness stand after signaling late in the trial he might.
U.S. District Judge Jed Rakoff scheduled a tentative sentencing date of October 18. The maximum sentence for securities fraud is 20 years and the maximum sentence for conspiracy is five years, although it seems unlikely that Gupta would receive such a heavy punishment.
Rajaratnam, founder of Galleon Group hedge fund, was convicted of 14 counts of securities fraud and conspiracy last year and is serving an 11-year prison term. He turned 55 years old on Friday in prison near Boston.
Earlier this month, a New Jersey federal court handed a 12-year sentence - the longest ever for insider trading - to a corporate lawyer whose illegal conduct stretched over 17 years.
In another tough sentence, a Houston federal judge sentenced disgraced financier Allen Stanford on Thursday to 110 years in prison for a $7 billion fraud that swindled investors out of their savings.
Two former executives of hedge funds Level Global and Diamondback and one trader who worked at SAC Capital Advisors unit Sigma, at the time of his arrest, could be the next significant criminal insider trading trial in October. They deny charges of running a $62 million scheme on Dell Inc stock. Level Global no longer manages money. Diamondback has settled civil insider trading charges. SAC has not been charged.
"THREW IT ALL AWAY"
Gupta "achieved remarkable success and stature, but he threw it all away" Manhattan U.S. Attorney Preet Bharara, who was also born in India, said in a statement after the verdict.
"Violating clear and sacrosanct duties of confidentiality, Mr. Gupta illegally provided a virtual open line into the board room for his benefactor and business partner, Raj Rajaratnam."
Jacob Frenkel and Andrew Stoltmann, two lawyers who were not involved in the Gupta trial, said the verdict surprised them because they believe juries nowadays come with what they termed a "CSI mentality" from the popular TV drama series "CSI: Crime Scene Investigation" where the evidence is direct.
"The partial guilty verdict suggests that the jury did in fact distinguish between the evidence in the counts, but that does not make me any less surprised because of the way I think juries tend to look at cases now," said Frenkel of Shulman, Rogers, Gandal, Pordy & Ecker in Potomac, Maryland.
Chicago securities lawyer Andrew Stoltmann, who predicted Gupta would be found not guilty, said, "Without real wire taps of Gupta, the jury was still able to connect the dots and bought into the prosecutor's arguments."
Among the most dramatic contentions at the trial was the prosecutors' charge that Gupta told Rajaratnam about the Buffett investment in Goldman at the height of the financial crisis.
Part of the prosecution's evidence was that within a minute of disconnecting from a September 23, 2008 board call approving the investment, Gupta called Rajaratnam at his Galleon Group office in New York. Rajaratnam then hurriedly ordered his traders to buy as much as $40 million in Goldman stock because only minutes remained before the market closed.
In an emailed statement, a Goldman spokesman said the firm was "disappointed that Mr. Gupta breached his duties as a director and violated our shareholders' and the firm's trust."
McKinsey & Co, where Gupta worked for 34 years, has cut ties with him and declined to comment on the trial.
The case is USA v Gupta, U.S. District Court for the Southern District of New York, No. 11-907.
(Reporting by Grant McCool and Basil Katz; editing by Martha Graybow, Bernadette Baum, Andre Grenon and Bernard Orr)
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