April 26, 2024

On TV Show, Armstrong Is Planning to Confess His Drug Use to Winfrey

Armstrong, 41, will give a limited confession to Winfrey and will not provide details of the doping that antidoping officials have said occurred throughout his cycling career, said the two people, who did not want their names published for fear of jeopardizing their access to him.

He is scheduled to sit down with Winfrey in his home in Austin, Tex., on Monday, for the interview, which will be shown Thursday on the Oprah Winfrey Network. USA Today first reported the news late Friday.

Neither Armstrong nor Tim Herman, Armstrong’s lawyer in Austin, immediately returned an e-mail request for comment.

The New York Times reported Jan. 4 that Armstrong was considering admitting publicly that he had used banned drugs and blood transfusions. Last fall, after 11 of his former teammates had testified against him, he was stripped of his seven Tour de France titles for doping and for his involvement in what officials called the most sophisticated, organized and professional doping program in sports history.

Armstrong is coming forward to discuss his past doping because he wants to persuade officials to lift his lifetime ban from Olympic sports so he can return to competing in triathlons and running events, according to people with knowledge of his plans.

Last month, Armstrong met with Travis Tygart, chief executive of the United States Anti-Doping Agency, to begin discussing a way in which an admission from Armstrong could mitigate his punishment. Under the World Anti-Doping Code, athletes can receive up to a 75 percent reduction of a ban if they provide substantial assistance to antidoping authorities in building cases against other cheaters. For his ban to be reduced, though, Armstrong will have to give information about the people who helped him in his doping.

If Armstrong does confess, he is opening himself to more legal troubles than he has now. He has been named as a defendant in a federal whistle-blower case that contends that Armstrong and his associates on the United States Postal Service cycling team used taxpayer dollars to finance a systematic doping program. The government is considering joining that case as a plaintiff.

Armstrong may also have to repay $12 million he received from SCA Promotions, a company based in Dallas that paid him millions for winning several Tours de France. Jeffrey Tillotson, a lawyer for the company, said Friday that he was waiting to see the interview with Winfrey before filing a lawsuit asking Armstrong to return that money.

Armstrong is also being sued by The Sunday Times of London for more than $1.5 million over the settlement of a libel case. The newspaper paid Armstrong nearly $500,000 after it published claims from the book “L.A. Confidentiel” that he had used performance-enhancing drugs.

What worries Armstrong the most, said people with knowledge of the situation, is criminal charges that could arise from his confession. The United States attorney’s office in Los Angeles closed an investigation into Armstrong early last year regarding doping-related crimes, including fraud, money laundering and drug trafficking. Another United States attorney’s office could reopen that investigation, several lawyers involved in the case said, although that is unlikely.

Article source: http://www.nytimes.com/2013/01/13/sports/cycling/lance-armstrong-will-confess-drug-use-to-oprah-winfrey-sources-say.html?partner=rss&emc=rss

DealBook: Regions Settles S.E.C. Case Over Former Morgan Keegan Funds

Robert Khuzami, director of the S.E.C.’s enforcement division, in February.Lucas Jackson/Reuters Robert Khuzami, director of the S.E.C.’s enforcement division, in February.

As regulators announced a settlement Wednesday with Morgan Keegan of charges that it defrauded customers during the financial crisis, its parent put the brokerage firm on the block.

Morgan Keegan, a unit of Regions Financial, the big Alabama-based bank, agreed to pay $200 million to resolve a case brought by the Securities and Exchange Commission. It accused the brokerage firm and two former executives of mispricing risky mortgage-backed bonds in supposedly conservative mutual funds.

One of those executives, the funds’ portfolio manager, James C. Kelsoe Jr., agreed to a lifetime ban from the securities industry.

“The falsification of fund values misrepresented critical information exactly when investors needed it most — when the subprime mortgage meltdown was impacting the funds,” Robert Khuzami, the director of enforcement at the S.E.C., said in a statement. ”Such misconduct does grievous harm to investors.”

Also Wednesday, Regions announced that it was putting Morgan Keegan up for sale in an effort to raise money to repay the $3.5 billion government loan it received during the financial crisis.

“The resolution of this legacy regulatory matter gives Regions great flexibility with respect to the Morgan Keegan franchise,” said Grayson Hall, the chief executive of Regions, which sold the bond funds connected to this case in 2008 to another asset management company.

Regions, which has owned Morgan Keegan since 2001, has retained Goldman Sachs to handle the sale of the brokerage firm. The firm, which is based in Memphis, could fetch as much as $1.5 billion, according to a person briefed on the business.

The action against Morgan Keegan is just one of a spate of enforcement actions taken against firms related to their mispricing of mortgage securities in their mutual funds during the financial crisis. The S.E.C. has brought similar cases against the Charles Schwab Corporation, Evergreen Investments and the State Street Corporation.

Federal authorities have recently stepped up actions against large banks related to their crisis-era conduct. On Tuesday, JPMorgan Chase agreed to pay about $150 million to settle civil accusations that it misled investors in a complex mortgage securities transaction in 2007.

Last month, federal prosecutors in Manhattan filed a civil action against Deutsche Bank, accusing it of lying about the quality of home loans it handled for the Federal Housing Administration. The bank is fighting the case.

Still, authorities continue to field questions about why they are not bringing criminal charges against bank executives and others who may have engaged in illegal practices during the mortgage boom.

During a conference call with regulators on Wednesday, a reporter asked why the government did not bring criminal charges in the Morgan Keegan case. The government officials declined to comment.

Investors in the five Morgan Keegan bond funds are said to have lost about $1.5 billion. These funds, which were marketed as relatively safe investment vehicles, lost more than half their value when the market for mortgage securities first seized up in 2007.

Two former Morgan Keegan executives — Mr. Kelsoe and Joseph Thompson Weller, a controller — were accused in the case.

Mr. Kelsoe, who started managing the Morgan Keegan funds in 1999, was a vocal booster of mortgage securities during the housing boom and became one of Wall Street’s top-ranked mutual fund managers. Investors reaching for extra yield during last decade’s persistently low-interest-rate environment flocked to Mr. Kelsoe’s funds.

But regulators said that Mr. Kelsoe ignored the funds’ charter by investing predominantly in the risky structured products that became popular during the credit bubble, including pools of subprime mortgage-backed securities.

The S.E.C. action also accused him of instructing Morgan Keegan’s accounting department to make fake “price adjustments” to inflate the value of the funds’ mortgage-backed securities holdings as the housing market began to sour.

Mr. Kelsoe became an early, prominent casualty of the crisis in subprime mortgage bonds.

“What was an ocean of liquidity has quickly become a desert,” wrote Mr. Kelsoe in a report to his investors in October 2007 as the fund was plummeting. He once compared his “intoxication” with low-grade mortgage securities to that of fund managers seduced by dot-com stocks.

Mr. Kelsoe, 49 and a resident of Memphis, agreed to pay a $500,000 penalty and accept a permanent ban from the securities industry. Mr. Weller agreed to pay a $50,000 fine.

Regulators from the Financial Industry Regulatory Authority, or Finra, as well as regulators from five Southern states were involved in the Morgan Keegan investigation and settlement.

Federal and state authorities continue to pursue separate claims against Morgan Keegan related to its sale of auction-rate securities, another risky investment product that soured during the financial crisis.

Although buffeted by the government’s accusations, Morgan Keegan has performed well. Potential buyers could include a bank or brokerage firm looking to bolster its presence in the Southeast, or a private equity firm. A number of buyout shops have previously made successful investment in brokerage firms and asset managers, including Hellman Friedman, TA Associates and Lightyear Capital.

Article source: http://feeds.nytimes.com/click.phdo?i=f601603fc25a7d9cb810f4e262bc4483