SEC Announces Settlement With Aspen Technology

The Securities and Exchange Commission today charged Aspen Technology, Inc., with fraudulently inflating revenue over a three-year period. The SEC's order finds that Aspen's former senior management, motivated by a desire to boost revenues and meet securities analyst earnings expectations, was directly involved in negotiating and improperly recognizing revenue on transactions.

The SEC's order directs Aspen, a software company based in Cambridge, Mass., to cease and desist from violating various provisions of federal securities laws, and requires Aspen to retain an independent consultant to review the company's financial and accounting policies and procedures. Aspen consented to the issuance of the order without admitting or denying any of the SEC's findings.

"Companies must take seriously their obligations to accurately report their financial results to their shareholders who depend on that information to make investment decisions," said Linda Chatman Thomsen, Director of the SEC's Division of Enforcement. "The management of reported earnings through premature revenue recognition will not be tolerated."

David P. Bergers, Director of the SEC's Boston Regional Office, added, "Aspen took significant remedial steps and cooperated extensively with the Commission's investigation. Aspen promptly self-reported the misconduct, conducted a thorough internal investigation, and shared the findings of that investigation with the staff. Consistent with the principles announced in the Commission's January 2006 Statement Concerning Financial Penalties, the Commission considered Aspen's remediation and cooperation, among other things, in deciding not to impose a penalty."

According to the SEC's order, Aspen - often acting through its former Chief Executive Officer, Chief Financial Officer and Chief Operating Officer - improperly recognized revenue on at least 19 different software license transactions involving at least 15 different customers worldwide. According to the order, the scheme involved premature recognition of revenue not recognizable under generally accepted accounting principles in the quarterly reporting periods claimed by Aspen either because contracts were not signed within the appropriate quarter or because the earnings process was incomplete due to side letters or other contingency arrangements. The SEC's order finds that, in several reporting periods, Aspen would not have met analysts' earnings expectations without the improperly recognized revenue.


The Commission previously filed a civil injunctive action on Jan. 8, 2007, against three former executives of Aspen in United States District Court for the District of Massachusetts. That case is still pending. (See LR-19960) In addition, on March 26, 2007, one of the former executives pleaded guilty to one count of conspiracy and one count of securities fraud in connection with related charges brought by the United States Attorney's Office for the Southern District of New York. (See LR-20059)

The Commission acknowledges the assistance and cooperation of the U.S. Attorney's Office for the Southern District of New York and the Federal Bureau of Investigation.

GE Capital Solutions, Franchise Finance Purchases Portfolio from Citicorp Leasing Inc.

As part of its business growth strategy, GE Capital Solutions, Franchise Finance has purchased $13.3 million in restaurant loans from Citicorp Leasing Inc. The portfolio represents three borrower groups and 24 loans.

Through its strong and established relationship, GE Capital Solutions, Franchise Finance and Citicorp Leasing Inc. worked closely together to quickly assess the value of this portfolio and close this deal.

“This is an attractive portfolio purchase due to stable asset protection, improving cash flow, increasing same store sales trends, and the breadth and experience of these restaurant operators,” says Barry Perhac, vice president, business development, GE Capital Solutions, Franchise Finance. “This purchase provides new clients to grow our existing asset base.”

GE Capital Solutions, Franchise Finance is a leading lender serving customers in the restaurant, hospitality, branded beverage, automotive after-market, and power sports industries. It provides financing to help franchisees and franchisors grow, compete, and prosper. It offers access to capital with a diverse array of flexible financing options, including funds for purchasing real estate or equipment, new construction or remodels, acquisitions, or refinancing.

About GE Capital Solutions, Franchise Finance

GE Capital Solutions, Franchise Finance is a leading lender for the franchise finance market via direct sales and portfolio acquisition. With more than 30 years of experience and $14 billion in served assets, we serve more than 6,000 customers and more than 20,000 property locations, primarily in the restaurant, hospitality, branded beverage, power sports, and automotive after-market industries. We offer customers access to capital with a menu of products featuring flexible structuring, including financing for acquisitions, refinancing, construction of new units, and remodels for single- and multi-unit operators/chains. More information is available at www.gefranchisefinance.com or by calling toll-free 866-GET-GEFF (438-4333).

GE Capital Solutions provides leasing, lending, and capital investment products and services to help business customers grow. It has more than $90 billion in assets, serves more than a million clients around the world, and is headquartered in Danbury, Connecticut, USA. For more on GE Capital Solutions, go to www.ge.com/capitalsolutions.

GE (NYSE: GE) is Imagination at Work — a diversified technology, media and financial services company focused on solving some of the world's toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, media content and advanced materials, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit the company's Web site at www.ge.com.

SEC Sues Cardinal Health, Inc. For Fraudulent Earnings and Revenue Management Scheme

The Securities and Exchange Commission today announced that Cardinal Health, Inc., a pharmaceutical distribution company based in Dublin, Ohio, has agreed to pay $35 million to settle charges that it engaged in a nearly four-year long fraudulent revenue and earnings management scheme, as well as other improper accounting and disclosure practices.

The Commission's complaint alleges that, from September 2000 through March 2004, Cardinal engaged in this conduct in order to present a false picture of its operating results to the financial community and the investing public - one that matched Cardinal's publicly disseminated earnings guidance and analysts' expectations, rather than its true economic performance. Through these practices, Cardinal materially overstated its operating revenue, earnings and growth trends in certain earnings releases and filings with the Commission.

Linda Thomsen, Director of the Commission's Division of Enforcement, said, "Cardinal's scheme deceived investors by presenting a string of revenue and earnings reports and other disclosures that reflected a false picture of Cardinal's financial performance. As this case demonstrates, issuers cannot resort to accounting ploys and misleading disclosures to make their numbers."

Antonia Chion, an Associate Director of the Commission's Division of Enforcement, said, "Sound financial reporting - the foundation of our capital markets - includes not only compliance with GAAP, but transparent disclosure of information that investors need to understand a company's performance. Cardinal's fraudulent mischaracterization of its operating revenues, as alleged, deprived investors of material information."

According to the complaint, Cardinal managed its reported revenue and earnings through a variety of undisclosed and improper actions. Cardinal inflated reported operating revenue by misclassifying more than $5 billion of bulk sales as operating revenue. Cardinal classified its revenue from drug distribution as either "bulk" revenue, which consisted of certain full case quantities of pharmaceutical products delivered to customer warehouses, or operating revenue, which consisted of all other sales. The complaint alleges that Cardinal implemented an undisclosed internal practice under which it reclassified any revenue from the sale of bulk product held on its premises for 24 hours or longer as operating revenue. As the complaint describes, Cardinal, among other improper practices, began intentionally holding certain bulk shipments for longer than 24 hours, in order to shift revenue from the bulk revenue line to the operating revenue line. The complaint alleges that Cardinal decided when to start and stop this practice based on the strength or weakness of quarterly sales and earnings.

According to the complaint, Cardinal also managed its reported earnings by:

selectively accelerating, without disclosure, the payment of vendor invoices in order to prematurely record a cumulative total of $133 million in cash discount income;
improperly adjusting reserve accounts, which misstated earnings by more than $65 million; and
improperly classifying $22 million of expected litigation settlement proceeds to increase operating earnings.
In addition, the complaint alleges that Cardinal failed timely to disclose the impact of a change in the method of applying its last-in-first-out (LIFO) inventory valuation accounting principle and, on one occasion, intentionally transferred inventory within business units in order to avoid a negative LIFO impact on year-end reported earnings. Furthermore, the complaint alleges that Cardinal prematurely recognized millions of dollars in revenue from Pyxis, a wholly-owned subsidiary it featured as an important growth driver.

The terms of the settlement reflect, and the Commission acknowledges, the cooperation provided by Cardinal during the course of the SEC investigation. Without admitting or denying the allegations of the Commission's complaint, Cardinal agreed to be permanently enjoined from violating the antifraud, reporting, record-keeping and internal controls provisions of the federal securities laws. Cardinal also agreed to pay $1 in disgorgement and a $35 million penalty, which the Commission will seek to place in a Fair Fund for distribution to affected shareholders. Cardinal also will engage an independent consultant to conduct a review of its disclosure processes, practices and controls, as well as those policies and procedures that relate to allegations in the Commission's complaint. The settlement is subject to court approval.

The Commission also acknowledges the assistance and cooperation of the U.S. Attorney's Office for the Southern District of New York. The Commission's investigation is continuing.

SEC Charges Former Chairman and CEO of Brooks Automation in Stock Option Fraud

The Securities and Exchange Commission has filed a civil fraud action against Robert J. Therrien, former President and CEO of Brooks Automation, Inc., a Massachusetts software company, alleging that he received millions of dollars in undisclosed compensation by fraudulently backdating his exercise of an option to purchase company stock.

Therrien also is alleged to have engaged in a broader fraudulent scheme to grant himself and other Brooks employees and executives undisclosed, in-the-money stock options. The complaint alleges that Therrien personally benefited by more than $10 million from his fraudulent conduct.

"All companies must play by the same rules when it comes to accounting for employee compensation and reporting its impact on the company's bottom line," said Linda Chatman Thomsen, Director of the SEC's Enforcement Division. "Executives who violate these rules for their own personal benefit will be held accountable for their actions."

David Bergers, Director of the SEC's Boston Regional Office, added, "Investors have the right to complete and accurate information about the financial condition of public companies and the compensation their executives receive. The Commission will continue to aggressively pursue actions against individuals who engage in fraudulent options practices that mislead investors."

The Commission's civil complaint alleges that Therrien received approximately $5.8 million in undisclosed compensation in November 1999, when he fraudulently backdated his exercise of an option to purchase 225,000 shares of Brooks stock. According to the complaint, after learning that his option had expired unexercised in August 1999, Therrien signed false documents indicating that he had actually exercised his option before its expiration. As a result, the company issued Therrien a new in-the-money option at the original price, which he immediately exercised to purchase company stock at a fraction of the market price when the option was re-issued.

The Commission's civil complaint further alleges that, on at least four occasions from 1999 through 2001, Therrien approved the issuance to company executives and employees of stock options that were backdated to earlier dates on which the stock's market price was lower. Through backdating, options that were in-the-money (with exercise prices below the market price) on the date they were actually granted were disguised as at-the-money options (with exercise prices at the market prices) purportedly granted on an earlier date. As a result of these instances of option backdating, the complaint alleges, Therrien received another $4.6 million in undisclosed benefits. The complaint alleges that as a result of Therrien's misconduct, he benefited by a total of at least $10.4 million and Brooks overstated income and understated employee compensation expenses by at least $54 million in its financial statements during the period from 1999 through 2005.

The complaint alleges that by his conduct Therrien violated the general antifraud provisions of the federal securities laws and provisions that prohibit misrepresentations to auditors and falsification of records, and that he aided and abetted Brooks in its violations of financial reporting, recordkeeping and internal controls requirements. The Commission's action seeks injunctive relief, a civil penalty, disgorgement and an officer and director bar against Therrien.

In a separate matter, the United States Attorney's Office for the District of Massachusetts today announced a criminal indictment charging Therrien with tax evasion for his conduct in connection with the November 1999 option transaction.

NASDAQ is Recognized as the World's Best Exchange for Data Feeds for the Second Year

The Nasdaq Stock Market, Inc. (Nasdaq:NDAQ) has been recognized as the world's premier stock exchange for data feeds for the second consecutive year. In the fifth annual Waters Rankings, readers of Waters magazine voted NASDAQ the winner of the "Best Exchange Data Feeds" award.

NASDAQ's acknowledgement of this distinguished award was determined by nearly 600 sell and buyside end users of data who subscribe to Waters magazine -- the leading publication for financial technology professionals worldwide.

The results show that readers of Waters magazine prefer NASDAQ for speed, price, reliability and overall service even more than they did last year. NASDAQ's margin of victory this year increased to 12% versus last year's 2% margin.

"Receiving this endorsement from hundreds of industry experts is an especially rewarding achievement," said Adena Friedman, NASDAQ Executive Vice President, Corporate Strategy and Data Products. "Such recognition validates our ability to provide an array of innovative tools that help investors and traders achieve their trading strategies."

NASDAQ was also the recipient recently of another prestigious award for the second consecutive year. In May 2007, NASDAQ was recognized by the readership of Inside Market Data as the best data provider among the world's securities exchanges. Inside Market Data is the publication of choice for senior level data and technology executives within the financial services and securities industry throughout the world.

NASDAQ has delivered another innovative data solution with the recent introduction of The NASDAQ DataStore, an online collection of innovative data tools for institutional and individual investors. NASDAQ's offering of these unique data products on the Web marks the first time a U.S. stock exchange has provided an opportunity for direct purchase of this breadth of data directly via the Web.

As part of this initiative, NASDAQ will also be supporting full "plug-and-play" access to its premium market data products. This distribution allows market data vendors and market data distributors more efficient, easier, and less expensive deployments of new data products.

For more information about The NASDAQ DataStore and NASDAQ Data Products, visit http://www.nasdaqtrader.com/trader/mds/mdsoverview/mdsoverview.stm.

About NASDAQ

NASDAQ is the largest U.S. equities exchange. With approximately 3,200 companies, it lists more companies and, on average, trades more shares per day than any other U.S. market. It is home to companies that are leaders across all areas of business including technology, retail, communications, financial services, transportation, media and biotechnology. NASDAQ is the primary market for trading NASDAQ-listed stocks as well as a leading liquidity pool for trading NYSE-listed stocks. For more information about NASDAQ, visit the NASDAQ Web site at www.nasdaq.com or the NASDAQ Newsroom at www.nasdaq.com/newsroom/.

GE Reports Second-Quarter EPS up 13% to $.52 per Share;2007 Share Repurchase Program Increased to $14 billion;Record Orders of $25 billion, up 32%

GE announced today record second-quarter 2007 earnings from continuing operations of $5.4 billion or $.52 per share, up 12% and 13%, respectively, from second quarter 2006. Revenues from continuing operations were $42.3 billion, up 12%, increasing 8% organically.

“Infrastructure and Commercial Finance, which account for 56% of segment profit, led our strong performance this quarter with profit growth of 23% and 18%, respectively,” GE Chairman and CEO Jeff Immelt said. “Global demand for our Infrastructure products and services is unprecedented with double-digit revenue and earnings growth in Oil & Gas, Aviation, Energy, and Transportation. Strong global origination at Commercial Finance contributed to double-digit growth in assets, revenues, and earnings.

“We are building a highly visible and sustainable growth pipeline around the world,” Immelt said. “We are winning with technology and deepening customer relationships through services. Our total orders were up 32% to a record $25 billion, and total backlog grew $18 billion year-over-year, an increase of 42%. Major equipment orders were $13.1 billion, up 54%, and major equipment backlog grew to $44 billion, up 53%. Services orders were up 11%, and our Customer Service Agreement (CSA) backlog stands at $96 billion, up 10%.

“With our strong orders and momentum, we are forecasting third quarter EPS from continuing operations of $.54-.56, up 15-19% over comparable 2006 earnings. We are reaffirming guidance for the full year and are on track to deliver a solid, low-risk performance in 2007 with high visibility to organic growth. We are increasing our 2007 share repurchase program to $14 billion, with the remaining $12 billion to be allocated over the second half of the year. The Board of Directors increased the program, announced in 2004, to $27 billion and accelerated it by a year to be completed by the end of 2007,” Immelt said.

GE delivered its tenth straight quarter of organic revenue growth of 2-3 times global GDP generated by broad-based services and global market demand. Services revenues were up 12% and global revenues grew 21%, with $8.3 billion from developing markets, up 29%.

GE’s segment profit grew 11% and industrial segment operating profit margin increased 70 basis points to 17%. With year-to-date segment operating profit growth of 120 basis points, the company is on track to meet its goal of 100 basis points of margin expansion for the year.

“For the quarter, GE Money had strong global growth in revenues and assets, and increased segment profit 8% despite a loss at its U.S. mortgage business, WMC,” Immelt said. “We have made the decision to exit this business and substantially reduced our exposure by selling $3.7 billion of WMC loans in the quarter.

“NBC Universal grew segment profit 2% with a strong cable, film, and digital performance. Its current operating improvements coupled with a successful upfront provides a solid foundation for future performance,” Immelt said.

“At Healthcare, the impact from the Deficit Reduction Act (DRA) and the continued regulatory suspension on shipments of surgical supplies by our OEC business was greater than expected,” Immelt said. “In the short term, these challenges more than offset strong performances in our other Healthcare businesses. However, the future of this business remains solid.”

In the second quarter, GE realized a $0.5 billion after-tax gain from its nuclear joint venture with Hitachi. At the same time, GE recorded $0.6 billion of restructuring and other charges, including $0.2 billion that was recorded in the GE Money segment. The company’s consolidated tax rate was 17%, consistent with the first quarter of 2007 and in line with expectations.

Second-Quarter 2007 Financial Highlights:

Earnings from continuing operations were a record $5.4 billion, up 12% from $4.8 billion in second quarter 2006. EPS from continuing operations were $.52, up 13% from last year’s $.46. GE’s Infrastructure and Commercial Finance businesses contributed strong double-digit earnings growth for the quarter.

Continuing revenues grew 12% to a record $42.3 billion. GE industrial sales were $24.3 billion, an increase of 10% from second quarter 2006, reflecting core growth and the net effects of acquisitions. Financial services revenues grew 11% over last year to $17.1 billion, primarily reflecting core growth.

Cash generated from GE’s continuing operating activities (CFOA) in the first six months of 2007 totaled $11.6 billion, down 16% from $13.8 billion last year. The decrease was the result of $3.0 billion of lower special dividends from GE Capital Services related to prior year proceeds from sales of insurance holdings, which more than offset an 11% increase from the industrial businesses’ continuing operations.

Discontinued Operations for the second quarter reflected a $21 million profit, down from last year’s $0.1 billion. Effective in second quarter 2007, discontinued operations for all periods presented include the results of our Plastics business, expected to be sold in third quarter 2007, and the results of our former Advanced Materials business for periods prior to its sale in fourth quarter 2006. Accordingly, second quarter net earnings were $5.4 billion ($.53 per share) in 2007 and $4.9 billion ($.48 per share) in 2006.

“We have made significant changes to drive growth across the company and around the world. We have created a faster growing, higher returning set of businesses through smart acquisitions and dispositions. We have diligently executed on our ‘growth as a process’ initiative. We have invested in technology and services to better serve our customers,” Immelt said. "Our financial goals have been clear: consistent, double-digit earnings growth with expanding margins and increasing returns. We have delivered another quarter that meets our goals and reflects the power of our portfolio of leading businesses. We are investing and delivering.”

GE will discuss preliminary second-quarter results on a conference call and Webcast at 8:30 a.m. ET today. Call information is available at www.ge.com/investor, and related charts will be posted there prior to the call.

GE (NYSE: GE) is Imagination at Work -- a diversified technology, media and financial services company focused on solving some of the world’s toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, media content and advanced materials, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit the company's Web site at www.ge.com

VeriSign Files Restatement of Financial Statements

VeriSign, Inc. (Nasdaq: VRSN) announced today that it has filed with the SEC its Annual Report on Form 10-K for the year ended December 31, 2006 as well as its previously delayed Quarterly Reports on Form 10-Q for the second and third quarters of 2006. These reports contain financial statements that were restated as a result of an independent review by an ad hoc group of independent Directors of VeriSign’s Board of Directors into VeriSign’s historical stock option grant practices and include adjustments to consolidated financial statements for the years ended December 31, 2005, 2004, 2003 and 2002.

In November 2006, the Company announced that its Board of Directors had determined the need to restate historical financial statements to record additional non-cash, stock-based compensation expense related to past stock option grants with incorrect measurement dates, without required documentation, or with initial grant dates and prices that were subsequently modified. At that time, the company estimated that the non-cash stock-based compensation charge for the years 2002 - 2005 would not exceed $250 million.

The total non-cash, stock-based compensation expense related to past stock option grants for the years 2002 -2005 was $160.3 million, after tax.

The Company also announced today that Chief Financial Officer, Dana Evan, resigned on July 10, 2007, and Bert Clement, former Senior Vice President, Finance and Controller, has been elected Chief Financial Officer.

On January 31, 2007, the Company announced that the independent review was substantially completed, and did not find intentional wrong doing by any current member of VeriSign’s senior management, including former CEO, Stratton Sclavos, and former CFO, Dana Evan.

Additional financial information for the full year 2006 periods is available on the Company’s investor relations website at http://investor.verisign.com

VeriSign intends to file its quarterly report on Form 10-Q for the first quarter of 2007 as soon as practicable.

About VeriSign
VeriSign, Inc. (NASDAQ: VRSN), operates digital infrastructure services that enable and protect billions of interactions every day across the world’s voice, video and data networks. Additional news and information about the company is available at www.verisign.com

Amgen Board Authorizes $5 Billion Increase in Stock Repurchase Program

Amgen today announced that its board of directors has authorized additional repurchases of up to $5 billion in Amgen common stock. The company currently has $1.5 billion remaining under its previous stock repurchase authorization. This new authorization reflects Amgen's confidence in its long-term prospects.

About Amgen

Amgen discovers, develops and delivers innovative human therapeutics. A biotechnology pioneer since 1980, Amgen was one of the first companies to realize the new science's promise by bringing safe, effective medicines from lab, to manufacturing plant, to patient. Amgen therapeutics have changed the practice of medicine, helping millions of people around the world in the fight against cancer, kidney disease, rheumatoid arthritis, and other serious illnesses. With a deep and broad pipeline of potential new medicines, Amgen remains committed to advancing science to dramatically improve people's lives. To learn more about our pioneering science and our vital medicines, visit http://www.amgen.com/

Seiji Yasubuchi Appointed President and CEO of GE Commercial Finance Japan

GE Commercial Finance announced today that Seiji Yasubuchi has been named President and CEO, GE Commercial Finance Japan. With the alignment of Healthcare Financial Services, Corporate Financial Services, and Capital Solutions, Commercial Finance will approach the market as one business adding more value to customers while strengthening the brand and creating new opportunities for growth.

“This is a critical step in our overall business strategy,” said John Flannery, President and CEO of GE Commercial Finance Asia. "We are committed to Japan and I believe that with Seiji’s wealth of experience and demonstrated leadership we will accelerate growth and expand our footprint in Japan.”

Most recently, Seiji led Business Development as Senior Vice President, GE Commercial Finance Asia. Prior to joining GE, he was the Managing Director of UBS Investment Bank Japan. He has also held several leadership positions with Mitsubishi Corporation. Seiji Yasubuchi has a BA in Economics from Waseda University and an MBA from Harvard Business School.

About GE Commercial Finance

GE Commercial Finance (www.gecommercialfinance.com) offers businesses around the globe an extensive array of financial products and services. With more than US$246 billion in assets and expertise in the middle-market, GE Commercial Finance provides loans, operating leases, financing programs and innovative structured capital to help customers grow. Headquartered in Norwalk, Connecticut, GE Commercial Finance is a wholly owned subsidiary of the General Electric Company (NYSE:GE), a diversified services, technology and manufacturing company with operations worldwide.

SEC Charges Two Texas Swindlers In Penny Stock Spam Scam Involving Computer Botnets

The Securities and Exchange Commission has filed securities fraud charges against two Texas individuals in a high-tech scam that hijacked personal computers nationwide to disseminate millions of spam emails and cheat investors out of more than $4.6 million. The scheme involved the use of so-called computer "botnets" or "proxy bot networks," which are networks comprised of personal computers that, unbeknownst to their owners, are infected with malicious viruses that forward spam or viruses to other computers on the Internet. The scheme began to unravel, however, when a Commission enforcement attorney received one of the spam emails at work.

The Commission alleges that Darrel Uselton and his uncle, Jack Uselton, both recidivist securities law violators, illegally profited during a 20-month "scalping" scam by obtaining shares from at least 13 penny stock companies and selling those shares into an artificially active market they created through manipulative trading, spam email campaigns, direct mailers, and Internet-based promotional activities. Scalping refers to recommending that others purchase a security while secretly selling the same security in the market.

In related enforcement actions, the Attorney General's Office for Texas and the Harris County District Attorney's Office indicted the Useltons for engaging in organized criminal activity and money laundering. The Texas criminal authorities also have seized more than $4.2 million from bank accounts associated with the Useltons.

"This latest step in the Commission's anti-spam initiative is intended to protect investors from fraud artists who would treat the investing public as their personal ATM machines," said SEC Chairman Christopher Cox. "The use of bots to spread investment spam at exponentially higher rates is making this type of fraud an even more virulent threat to ordinary investors. Not only are victims getting hit with get-rich-quick spam, but by turning the victims' computers into zombies, these fraudsters are sending out still more spam to others. Given estimates that up to one-quarter of all personal computers connected to the Internet are part of a botnet, and the thriving market in selling lists of compromised computers to hackers and spammers, the SEC is taking this very seriously. We remain aggressively committed to tracking down anyone attempting to use bots to prey on investors with false or misleading spam about securities."

Linda Chatman Thomsen, SEC Director of Enforcement, said, "The scheme executed by the Useltons reflects a widespread contempt for investors and the marketplace. We will track down the swindlers engaged in these fraudulent schemes and hold them accountable."

The Commission's complaint, filed in U.S. District Court in Houston, alleges that the Useltons orchestrated a series of spam email campaigns using an array of computer botnets to anonymously flood the inboxes of American investors with millions of spam emails touting near-worthless penny stocks with baseless price projections and other unfounded claims. Each campaign, which featured a single company, lasted anywhere from several days to several weeks.

The Commission alleges that between May 2005 and December 2006, the Useltons obtained more than $4.6 million through their fraudulent scheme. According to the complaint, the Useltons and the companies they controlled typically received unrestricted shares from penny stock companies for little or no money, in return for purported financing or promotional activities.

The Commission's complaint alleges that the Useltons violated the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against each of the individual defendants, as well as penny stock bars against the Useltons.

Darrel Uselton was disciplined by the National Association of Securities Dealers (NASD) in 2004 and 2005. Jack Uselton was permanently enjoined by the Commission from violating the anti-fraud provision in a 2002 settled action.

The company stocks that were the subject of the Useltons’ spam campaign, according to the SEC’s complaint, included Oretech, Inc.; Intelligent Sports, Inc.; Advanced Powerline Technologies; Notch Novelty Corporation; Avondale Resources Corporation; Spooz, Inc.; ESPRE Solutions, Inc.; Grifco International, Inc.; Leatt Corporation; Adrenaline Nation Entertainment, Inc.; Equipment and Systems Engineering, Inc.; Gulf Petroleum Exchange, Inc. (currently Software Effective Solutions Corp.); and Wentworth Energy, Inc.

The SEC in March 2007 suspended trading in the securities of three of the companies (Advanced Powerline Technologies, Leatt Corporation, and Software Effective Solutions Corp.) as part of its anti-spam initiative. The SEC revoked the registration of the securities of Oretech, Inc. in December 2005.

The Commission acknowledges the assistance of the Attorney General's offices for New York and Texas, The Harris County (Houston, Texas) District Attorney's Office, the Federal Bureau of Investigation, the Texas State Securities Board, the State of Oklahoma Department of Securities, the National Association of Securities Dealers and the National Cyber-Forensics and Training Alliance.

The Commission's investigation is continuing.

NASDAQ Grants License to the CBOE Futures Exchange to Trade Futures On the CBOE NASDAQ-100 Volatility Index

The NASDAQ Stock Market ("NASDAQ(r)") (Nasdaq:NDAQ) announced it has licensed the CBOE Futures Exchange(sm) (CFE(r)) to offer futures contracts based on the CBOE NASDAQ-100 Volatility Index(sm) (symbol VXNSM, futures symbol VN), which launched on Friday, July 6.

John Jacobs, Executive Vice President for NASDAQ, said, "We are very pleased to partner with CFE in taking this important step forward for the financial markets. Volatility is an emerging new asset class and tools like the CBOE NASDAQ-100 Volatility Index are playing a vital role in spurring the growth and development of this space. With the introduction of these new futures contracts, investors, for the first time, now have the ability to trade the CBOE NASDAQ-100 Volatility Index."

Volatility is a measure of the fluctuation in the price performance of underlying stocks or stock indexes. Mathematically, volatility is the annualized standard deviation of returns. Typically, higher volatility signifies more uncertainty while lower volatility means less uncertainty. In 2007, the CBOE NASDAQ-100 Volatility Index has ranged in value between 14.83 and 24.61 and has recently been below the mid-point of its 2007 high-low range. The CBOE applies a similar measurement of option-derived volatility to the NASDAQ-100 Index that it applies to other leading U.S. stock market indexes, including those of Dow Jones, Standard & Poor's, and Russell. CBOE first introduced the CBOE NASDAQ-100 Volatility Index as a benchmark index in January 2001. For more information on how the CBOE NASDAQ-100 Volatility Index is calculated, as well as daily historical data, visit the CBOE's website at www.cboe.com/VXN.

NASDAQ Financial Products (NFP) is engaged in the design, development, calculation, licensing, and marketing of NASDAQ indexes. NFP specializes in the development of indexes focusing on NASDAQ's brand themes of innovation, technology, growth, and globalization. More than 500 financial products sold in 36 countries are based on NASDAQ indexes. NFP also provides custom index services and design solutions as a third-party provider to selected financial organizations.

NASDAQ is the largest U.S. equities exchange. With approximately 3,200 companies, it lists more companies and, on average, trades more shares per day than any other U.S. market. It is home to companies that are leaders across all areas of business including technology, retail, communications, financial services, transportation, media and biotechnology. NASDAQ is the primary market for trading NASDAQ-listed stocks as well as a leading liquidity pool for trading NYSE-listed stocks. For more information about NASDAQ, visit the NASDAQ Web site at www.nasdaq.com

Bank of America Hires M&A Banker Dimitri Steinberg, Expands Market Leading Healthcare Franchise

Bank of America today announced that it has expanded its Healthcare Investment Banking M&A team with the addition of managing director Dimitri Steinberg. Steinberg is based in New York and reports to Michael McIvor, Head of Healthcare, Consumer and Retail M&A.

"We are excited to welcome Dimitri to Bank of America," said McIvor, who also serves as Co-Chair of the firm's Global M&A Operating Committee. "His extensive knowledge of the healthcare industry and rich M&A background complement our deep bench of existing talent."

Steinberg comes to Bank of America from HSBC, where he established the firm's Healthcare M&A investment banking practice. In his role, he oversaw strategic planning, hiring and operations for the group as well as client coverage for large-cap pharmaceutical and select specialty pharmaceutical and medical technology clients. Prior to HSBC, Steinberg spent almost a decade at Lazard Freres, where he specialized in M&A across several industry groups, including Healthcare, Power & Utility, and Technology, Media & Telecommunications.

Bank of America also announced that John Lalis has joined Bank of America as a vice president in Healthcare M&A, reporting to McIvor. Lalis joins from Seaview Securities, a boutique investment bank focused on the life sciences industry, where he was a vice president and partner. He began his investment banking career in the Healthcare Group at Lehman Brothers.

Bank of America continues to be recognized as a top provider of healthcare investment banking and advisory services and in 2006, led the market in announced and completed M&A transactions, according to SDC. Underscoring its leadership in providing strategic and financial advice, the firm acted as a financial advisor to the consortium that purchased hospital operator HCA for approximately $33 billion; to Caremark Rx, Inc., in its $27 billion merger with CVS Corporation; and to Holiday Retirement Corporation in its acquisition by Fortress Investment Group LLC. The Firm was sole financial advisor to Health Management Associates, Inc., on a shareholder value-driven recapitalization that returned approximately $2.4 billion to shareholders.

Bank of America (NYSE: BAC) is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial products and services. The company's Global Corporate and Investment Banking group (GCIB) focuses on companies with annual revenues of more than $2.5 million; middle-market and large corporations; institutional investors; financial products and services. The company's Global Corporate and Investment Banking group (GCIB) focuses on companies with annual revenues of more than $2.5 million; middle-market and large corporations; institutional investors; financial institutions; and government entities. GCIB provides innovative services in M&A, equity and debt capital raising, lending, trading, risk management, treasury management and research. Bank of America serves clients in 175 countries and has relationships with 98 percent of the U.S. Fortune 500 companies and 80 percent of the Global Fortune 500. Many of the bank's services to corporate and institutional clients are provided through its U.S. and UK subsidiaries, Banc of America Securities LLC and Banc of America Securities Limited. For additional information, visit http://www.bankofamerica.com/

SAP Responds To Oracle Complaint

SAP AG (NYSE: SAP), together with SAP America and its subsidiary TomorrowNow, on July 2, 2007 Pacific Daylight Time, filed its answer to a complaint originally filed by Oracle Corporation on March 22, 2007 and subsequently amended on June 1, 2007. The filing in U.S. District Court represents the first formal SAP response to Oracle’s complaint. The full text of SAP’s answer can be accessed at www.tnlawsuit.com.

In the answer, SAP said TomorrowNow was authorized to download materials from Oracle’s Web site on behalf of TomorrowNow customers. At the same time, SAP acknowledged that some inappropriate downloads of fixes and support documents occurred at TomorrowNow. Importantly, SAP affirmed that what was downloaded at TomorrowNow stayed in that subsidiary’s separate systems. SAP did not have access to Oracle intellectual property via TomorrowNow.

The United States Department of Justice has requested that SAP and TomorrowNow provide certain documents. SAP and Tomorrow Now intend to fully cooperate with the request.

“Even a single inappropriate download is unacceptable from my perspective. We regret very much that this occurred,” said Henning Kagermann, CEO, SAP AG. “I want to reassure our investors, customers, partners and employees that SAP takes any departure from the high standards we set for all of our businesses very seriously, regardless of where it occurred or how confined it may be. When I learned what happened, I promptly took action to strengthen operational oversight at TomorrowNow while assuring that we maintain excellent service for TomorrowNow’s customers going forward.”

SAP Did Not Have Access to Oracle Materials through TomorrowNow
SAP stated that it did not have access to Oracle materials downloaded by TomorrowNow. SAP explained that it intentionally created a business structure that maintained a firewall between TomorrowNow and SAP and that it was satisfied that SAP AG or SAP America did not access Oracle intellectual property via TomorrowNow.

Most Materials Downloaded Appropriately by TomorrowNow
TomorrowNow often downloads support materials for and on behalf of its customers, who have chosen to seek third-party support for their legacy Oracle applications. Third-party maintenance providers like TomorrowNow depend on their customers – in this instance, companies who use Oracle-provided software – permitting the service provider access to support materials, through the customer’s password, to provide support and service for those customers’ Oracle applications. SAP acknowledged that some inappropriate downloads occurred at TomorrowNow.

Changes Announced at TomorrowNow
In addition to announcing its filing with the Court, SAP also announced that it has instituted changes in TomorrowNow’s operational management to ensure compliance with appropriate business practices. These steps include:

Appointment of SAP America Chief Operating Officer and former Chief Financial Officer Mark White as TomorrowNow’s Executive Chairman to manage TomorrowNow operations, including compliance programs. Andrew Nelson, TomorrowNow’s CEO, will report to Mark White;
Enforcement of existing procedures and new policies;
Renewed training for TomorrowNow employees to assure understanding of the policies and procedures.

SAP Launches Web Site for TomorrowNow Lawsuit
SAP announced a Web site that provides complete and immediate information regarding this suit. Located at www.tnlawsuit.com., the Web site includes Court filings, a timeline, SAP and TomorrowNow statements and announcements regarding the case, and background information.

Teleconference Information
SAP said it would host two teleconferences regarding its response to Oracle’s lawsuit.

Tuesday, July 3 at 8:00 a.m. CET / 2:00 a.m. EDT / 11:00 p.m. PDT (July 2)
UK/Europe dial-in: +44 208 515 2301
United States dial-in: (480) 293-1744

A replay will be available until July 17:
UK/Europe: +44 207 154 2833
United States: (303) 590-3030
Access code: 3755412

Tuesday, July 3, at 8:00 a.m. PDT / 11:00 a.m. EDT / 5:00 p.m. CET
UK/Europe dial-in: +44 208 515 2302
United States dial-in: (480) 629-9564

A replay will be available until July 17:
UK/Europe: +44 207 154 2833
United States: (303) 590-3030
Access code: 3755415

The teleconferences also will be simulcast via SAP’s Web site at www.sap.com/press.

SAP’s filing in U.S. District Court represents the latest in a series of procedural steps in this matter. The next scheduled event in this case is the initial case management conference, to be held by the Court on September 4, 2007.

About TomorrowNow
For more information on TomorrowNow visit www.tomorrownow.com

About SAP
SAP is the world’s leading provider of business software*. Today, more than 39,400 customers in more than 120 countries run SAP applications—from distinct solutions addressing the needs of small businesses and midsize companies to suite offerings for global organizations. Powered by the SAP NetWeaver platform to drive innovation and enable business change, SAP software helps enterprises of all sizes around the world improve customer relationships, enhance partner collaboration and create efficiencies across their supply chains and business operations. SAP solution portfolios support the unique business processes of more than 25 industries, including high tech, retail, financial services, healthcare and the public sector. With subsidiaries in more than 50 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE under the symbol “SAP.” (Additional information at )

(*) SAP defines business software as comprising enterprise resource planning and related applications such as supply chain management, customer relationship management, product life-cycle management and supplier relationship management.

SEC Announces $37 Million Fair Fund Distribution to Mutual Fund Investors Injured by Columbia Market Timing Fraud

The Securities and Exchange Commission today announced a $37 million Fair Fund distribution to more than 300,000 investors who were harmed by fraudulent mutual fund market timing in the Columbia Funds between 1998 and 2003.

The distribution is the first in a series of disbursements from the Fair Fund that will distribute a total of approximately $140 million to more than 600,000 affected Columbia Funds account holders. The Fair Fund resulted from a Commission enforcement action charging unlawful conduct by Columbia Management Advisors, Inc. (the adviser to the Columbia Funds) and by Columbia Funds Distributor, Inc. (the Fund's underwriter and distributor) by entering or allowing arrangements for undisclosed market timing in the Funds.

"The Commission has now returned more than $1.8 billion to injured investors through Fair Fund distributions in multiple cases," said Linda Chatman Thomsen, Director of the Division of Enforcement. "This first distribution from the Columbia Fair Fund marks another significant step in our continuing efforts to distribute fair funds to mutual fund investors."

"We are very pleased to begin this distribution to Columbia Funds investors who were injured by market timing," said David Bergers, Director of the Commission's Boston Regional Office, which handled the Columbia matter. "The Columbia Fair Fund allows us to use financial penalties and disgorgement from wrongdoers to return money to harmed investors."

In 2005, the Commission brought and settled public administrative and cease-and-desist proceedings against Columbia Management Advisors and Columbia Funds Distributor, which consented to a Commission Order charging anti-fraud violations without admitting or denying the Commission's findings. The Commission ordered the Columbia respondents to jointly pay $70 million in disgorgement and $70 million in penalties for distribution through the Fair Fund.

The Commission anticipates that approximately four additional distributions from the Fair Fund will be made to Columbia Funds account holders to complete the distribution process.

Investors can obtain additional information about the distribution process, including a copy of the Distribution Plan, by visiting http://www.columbiafairfund.com or by calling the Administrator of the Distribution Plan at (800) 410-5361.

GE Money to Increase Shareholding in Bank of Ayudhya to 31%

Bank of Ayudhya Public Company Limited (BAY) today announced that GE Money (representing GE Capital International Holdings Corporation), one of its major shareholders, upon receiving the requisite approval from the Bank of Thailand and Ministry of Finance, has increased its shareholding in BAY to 31%, on a fully diluted basis, as approved by BAY shareholders last year. GE Money subscribed for 444.7 million newly issued shares, representing a further investment in BAY of Bht 7.115 billion (approximately US$ 200 million). This further strengthens the bank’s capital adequacy ratio (CAR) to 19%.

Bank of Ayudhya Chairman of the Board, Mr. Veraphan Teepsuwan said, “We have reached another key milestone in our strategic partnership with GE Money, which is moving swiftly ahead as planned, and I am confident that the Bank will continue to draw benefits from this partnership. I believe other shareholders see this as another positive move for the bank. The Ratanarak family having 26% stake also welcomes this and remains fully supportive of the bank.”

GE Money Asia President and CEO Mr. Yoshiaki Fujimori said, “We are very pleased to be making this deeper commitment to the Bank. Our desire to increase GE Money’s shareholding in the Bank of Ayudhya reflects our unwavering confidence in BAY, the future of Thailand’s banking sector, and the long-term prospects of the country itself. We view the Ministry’s approval of the additional investment as a strong signal of the Government’s support for foreign direct investment. GE looks forward to further accelerating its partnership with BAY.”

Bank of Ayudhya President and CEO Mr. Tan Kong Khoon said, “I am delighted by the strong support we continue to receive from our major shareholders. This capital increase provides management with more flexibility for the growth plan of the Bank of Ayudhya. I am confident that, with this strengthened partnership, we are on track to achieving our vision to become Thailand’s most admired bank.”

Following an approval of the bank's shareholders at its Extraordinary Meeting of Shareholders held on 20 September 2006 (EGM Resolution No. 1-2549), GE has the right to increase its stake in BAY to up to 2 billion shares subject to necessary government approvals. On 3 January 2007, GE acquired an initial 1.391 billion shares equivalent to 25.4% interest in the Bank of Ayudhya. The current investment is made in accordance with the terms of the approval given by the bank's shareholders. That approval allows GE to subscribe for new shares at 16 baht per share up to the end of the third quarter of this year.

About Bank of Ayudhya Public Company Limited

Bank of Ayudhya Public Company Limited [SET:BAY], established on January 27, 1945, is the sixth largest commercial bank in terms of total assets in Thailand. BAY provides a full range of banking services to both its commercial and individual customers through 562 branches nationwide. On January 2007, BAY and GE Money, a premiere global consumer financial services firm, have successfully become strategic partners when GE Money took a 25.4% equity stake (fully diluted) in the Bank and plans are underway to leverage the synergies of both BAY and GE Money in helping to achieve BAY’s vision to become the most admired universal bank in Thailand.

ABOUT GE MONEY

With more than $190 billion in assets, GE Money, the consumer financial services unit of GE, is a leading provider of credit services to consumers, retailers, and auto dealers in 55 countries around the world. GE Money, based in Stamford, Connecticut (USA), offers a range of financial products, including private label credit cards, personal loans, bank cards, auto loans and leases, mortgages, corporate travel and purchasing cards, debt consolidation and home equity loans, and credit insurance. More information can be found at http://global.gemoney.com

ABOUT GE

GE (NYSE:GE) is Imagination at Work -- a diversified technology, media and financial services company focused on solving some of the world's toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, and media content, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit the company's Web site at www.ge.com

Bank of America Completes U.S. Trust Acquisition

Bank of America today completed its acquisition of U.S. Trust Corporation, creating U.S. Trust, Bank of America Private Wealth Management, the leading private wealth management organization in the United States. The acquisition further expands the capabilities and solutions of the Global Wealth & Investment Management division's alternative investments and proprietary asset management areas.

U.S. Trust combines legacy U.S. Trust with The Private Bank of Bank of America and its ultra wealthy extension, Family Wealth Advisors into one organization with nearly $265 billion in assets under management and over $427 billion in total client assets(1). As a further result of the acquisition completion, the investment management businesses of Bank of America and legacy U.S. Trust are being integrated within Columbia Management, Bank of America's asset management organization. Additionally, the alternative investments groups of both companies are being combined, offering clients expanded solutions in this area.

"Bank of America is creating the preeminent wealth management organization in the marketplace, providing highly tailored, world-class wealth and investment management advisory services and solutions," said Kenneth D. Lewis, Bank of America chairman and chief executive officer. "In completing this acquisition, we are building on our long history in private banking to better serve the needs of the country's wealthy individuals and families."

"In combining the rich history, unparalleled resources and extraordinary intellectual capital of both organizations, U.S. Trust provides a unique and distinctive experience to each and every client," said Brian Moynihan, president of Bank of America Global Wealth & Investment Management. "Under the leadership of Frances Aldrich Sevilla-Sacasa, U.S. Trust remains committed to developing and maintaining deep, personal and long-lasting relationships with our clients."

In discussing how high net worth and ultra high net worth clients will further benefit from the combined private wealth management organization, Sevilla-Sacasa said, "Our clients will soon have access to an even greater, deeper set of capabilities and talent to address their very unique and complex needs." Noting U.S. Trust's industry leadership in the nation, she added, "We are honored to be the wealth management provider of choice to more wealthy and ultra wealthy clients than any other company in the U.S. today."

Sevilla-Sacasa indicated that existing clients of the combined organization should continue to expect the same high-quality service and experience going forward, with no significant change in their interaction with the company.

About Bank of America

Bank of America is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The company provides unmatched convenience in the United States, serving more than 56 million consumer and small business relationships with more than 5,700 retail banking offices, more than 17,000 ATMs and award-winning online banking with nearly 22 million active users. Bank of America is the No. 1 overall Small Business Administration (SBA) lender in the United States and the No. 1 SBA lender to minority-owned small businesses. The company serves clients in 175 countries and has relationships with 98 percent of the U.S. Fortune 500 companies and 80 percent of the Fortune Global 500. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.

(1) Pro forma figures as of March 31, 2007

Columbia Management Group, LLC ("Columbia Management") is the investment management division of Bank of America Corporation. Columbia Management entities furnish investment management services and products for institutional and individual investors.