The fate of US negotiations to prevent the fiscal cliff were thrown into turmoil after efforts by Republican leaders in the House of Representatives to pass a back-up plan to prevent most of the looming tax increases collapsed amid a conservative backlash. After calling a dramatic emergency meeting of his own Republican party’s lawmakers, John Boehner, the House speaker, issued a statement saying there would be no vote on Thursday night on the Republican “plan B”, as planned. “The House did not take up the tax measure today because it did not have sufficient support from our members to pass. Now it is up to the president to work with Senator [Harry] Reid on legislation to avert the fiscal cliff,” Mr Boehner said, referring to the Democratic Senate majority leader. [Financial Times]
Investigations into potential Libor rigging at UBS have widened to Hong Kong after the Swiss bank admitted fraud, agreed to pay £940m in fines for manipulating the inter-bank rate, and saw two of its traders charged with conspiracy. The Hong Kong Monetary Authority, the central bank, launched an inquiry into UBS after receiving information from overseas regulators about “possible misconduct” related to the local inter-bank rate, Hibor, and other Asian reference rates. HKMA said it was looking into whether there had been “any material impact on Hibor” and that it would work with foreign regulators to “consider further actions that need to be taken”. [The Telegraph]
The Bank of England must be handed the legal authority to break up banks that misbehave, the Parliamentary Commission into Banking Standards will today tell the Chancellor, George Osborne. The Commission’s chairman Andrew Tyrie told The Independent that the failure to do this could put Britain at risk of a fresh financial crisis. In a 140-page report, coming just two days after UBS was fined more than £900m for attempting to fix Libor interest rates, the Commission said existing plans to reform banking and impose a ring fence to protect retail depositors fell “well short of what is required”. Mr Tyrie also said the revelations of what went on at UBS “beggar belief” and provided “the clearest illustration yet that a great deal more needs to be done to restore standards”. [The Independent]
The chief executive of Deutsche Telekom has revealed surprise plans to step down at the end of next year, ending a 16-year career at the German phones company. René Obermann, who has been in charge for seven years, told the board that he wanted to be closer to the operations of a business and be involved in something more entrepreneurial. Mr Obermann, 49, does not have a job to go to and will not be receiving a payoff, despite having a contract that was not due to expire until late 2016. [The Times]
Peter Madoff will serve 10 years in prison for his role in his older brother’s multibillion-dollar Ponzi fraud scheme, a US judge said on Thursday. Peter Madoff, 67, pleaded guilty in June to criminal charges including conspiracy to commit securities fraud for falsifying the books and records of the investment advisory company founded by his brother,Bernard Madoff. He agreed at the time not to oppose a request by prosecutors for a maximum 10-year prison sentence and agreed to an order requiring him to forfeit a symbolic $143.1bn. US district court judge Laura Taylor Swain approved the sentence on Thursday. [The Guardian]
Troubled BlackBerry maker Research In Motion (RIM) lost one million subscribers in the last quarter, the first drop in users in the company’s history. The news came as RIM reported better than expected revenues of $2.7bn (£1.6bn), although they were still down 47% compared with last year. Excluding one-time items related to restructuring and other issues, RIM reported a loss of $114m or 22 cents a share for the three months ending 1 December. [The Guardian]
The chief executive of Ofcom has said that he has “no idea” how much the fourth-generation mobile spectrum auction will raise, despite the Chancellor having booked £3.5 billion from it. Announcing the seven telecoms companies that have each paid £100,000 to enter Britain’s biggest spectrum sale, Ed Richards said that the regulator’s prerogative was not to raise the highest amount of money possible, but to ensure efficient use of the spectrum and competition.
Political opponents had accused George Osborne of manipulating the likely receipts when he announced in the Autumn Statement this month that the money from the 4G auction would be accounted for this financial year and spent on new infrastructure projects such as education colleges. Ofcom put a reserve price on the sale of £1.3 billion last month but yesterday refused to estimate how much it thinks the auction will raise. Analysts forecast a total of between £2 billion and £4 billion. [The Times]