The use of whistle-blowers at the Securities and Exchange Commission has proved effective. A tipster bolstered an investigation into a trading blowup that almost took down Knight Capital; another aided the discovery that Oppenheimer & Company had overstated the performance of a private equity fund; and a whistle-blower helped the government pursue a Ponzi scheme in Texas, Ben Protess and Nathaniel Popper report in DealBook.
But the S.E.C.’s 20-month-old whistle-blower program faces challenges on several fronts. “Some Wall Street firms are urging employees to report wrongdoing internally before running to the government, and one hedge fund, Paradigm Capital Management, was accused in a lawsuit of punishing an employee who had cooperated with the S.E.C., according to court and internal documents,†DealBook writes. “Another financial firm, the documents show, pressured an employee to forfeit potential ‘bounties or awards’ â€" a possible violation of S.E.C. rules.â€
Some lawyers say the S.E.C. takes weeks or months before it responds to a backlog of tips. Still, the agency, which fields dozens of tips a week, has ramped up the whistle-blower team to include 11 lawyers and three paralegals. “You’d be hard pressed to find another whistle-blower program that’s quicker,†said Sean McKessy, the director of the program. One longtime critic of the S.E.C., Harry M. Markopolos, a securities analyst who suspected the Madoff fraud a decade ago, said: “The question is whether they can turn it into successful enforcement actions.â€
APPLE’S PLAN TO REWARD SHAREHOLDERS  | Apple on Tuesday announced that it would more than double its program to return cash to shareholders through stock buybacks and a higher dividend, with plans to spend $100 billion on the effort through the end of 2015, The New York Times reports. The company said its share repurchase plan, which will increase to $60 billion from the $10 billion it committed previously, was the largest in history. Apple also plans to raise its dividend by 15 percent and pay out $3.05 a share.
The announcement came as Apple reported its first profit decline in a decade. The company’s stock, which has been on declining path for months, rose slightly in trading after hours. The effect of the payout to shareholders “may be mitigated pretty quickly†by the company’s cash flow, DealBook’s Michael J. de la Merced notes.
It was not exactly what the hedge fund manager David Einhorn had been pushing for. But Mr. Einhorn, who runs Greenlight Capital, was nevertheless pleased. He said in a statement: “We applaud Apple’s decision to borrow money and return excess capital to shareholders, an idea that was off the table only months ago.â€
LASRY TO STAY AT AVENUE CAPITAL  | The billionaire hedge fund manager Marc Lasry will not be moving to the ambassador’s mansion in Paris. Mr. Lasry, the chief executive and chairman of Avenue Capital, told his investors in a letter on Tuesday that he would remain at the hedge fund, ending speculation that President Obama was considering him for the role of ambassador to France. The investor had been a prominent supporter of Mr. Obama during the presidential campaign. “I am very grateful to have been considered,†Mr. Lasry said in the letter, which was obtained by DealBook. “I would like to put the speculation to rest and let you know that I will be remaining at Avenue.†Mr. Lasry is considered a “key man†in documents for a number of Avenue’s funds, according to a person briefed on the matter. A waiver of that provision wold have been required for him to assume a new job, and it was becoming clear that not all investors would grant such a waiver, this person said.
ON THE AGENDA  | Stephen A. Schwarzman of the Blackstone Group is on MSNBC’s “Morning Joe†to discuss his scholarship for study at a Chinese university. Sprint Nextel, which recently received a $25.5 billion takeover offer from Dish Network, reports earnings before the market opens. Zynga reports earnings on Wednesday evening. Senator David Vitter is on Bloomberg TV at 8:15 a.m. Sallie L. Krawcheck, a former executive for both Bank of America and Citigroup, is on CNBC at 10 a.m.
AUSTERITY FUN  | Stephen Colbert on Tuesday hosted Thomas Herndon, the graduate student at the University of Massachusetts, Amherst, who found apparent errors in the work of the Harvard economists Kenneth S. Rogoff and Carmen M. Reinhart, whose research was often cited to justify austerity policies. Or, as Mr. Colbert put it on his show, Mr. Herndon discovered “a few simple spreadsheet errors, and a couple of little staggering omissions that made it slightly fundamentally wrong. Even worse, none of their pie charts contained real pie.â€
ERRANT TWITTER MESSAGE MOVES STOCKS Â |Â The Dow Jones industrial average fell more than 150 points after the The Associated Press sent out an erroneous Twitter message, the result of a hack, reporting explosions at the White House that injured President Obama. Stocks soon recovered when it became clear there had been no incident.
SUPPORT FOR FORCING DISCLOSURES OF DONATIONS  | “A loose coalition of Democratic elected officials, shareholder activists and pension funds has flooded the Securities and Exchange Commission with calls to require publicly traded corporations to disclose to shareholders all of their political donations, a move that could transform the growing world of secret campaign spending,†Nicholas Confessore writes in The New York Times. “S.E.C. officials have indicated that they could propose a new disclosure rule by the end of April, setting up a major battle with business groups that oppose the proposal and are preparing for a fierce counterattack if the agency’s staff moves ahead.â€
Dell Approves Retention Bonuses  | Dell revealed in a filing that its board had approved a $91.1 million special bonus pool. WALL STREET JOURNAL
European Regulators to Review Exchange Merger  | European Union antitrust regulators will review the planned takeover of NYSE Euronext by IntercontinentalExchange, “in line with a request from the exchange operators themselves,†Reuters reports. REUTERS
Google Buys Wavii, an App for Summarizing News  | Google’s deal, worth roughly $30 million, came after a similar purchase by Yahoo, Reuters reports. REUTERS
Thai Magnate Loads Up on Debt for Big Deals  | The latest deals for Thailand’s richest man, Dhanin Chearavanont, only make sense as long as Southeast Asia’s financial boom keeps the cash flowing, Peter Thal Larsen of Reuters Breakingviews writes. REUTERS BREAKINGVIEWS
Credit Suisse Profit Soars in First Quarter  | Credit Suisse posted first-quarter earnings of $1.4 billion, a large increase from the period a year earlier when the bank booked large charges on its own debt. DealBook »
Barclays Earnings Fall Sharply on Restructuring Costs  | The British bank Barclays said on Wednesday that first-quarter pretax profit dropped 25 percent as it set aside money to pay for a major overhaul of its operations. DealBook »
HSBC to Cut 1,150 Additional Jobs in Britain  | The job cuts are separate from a cost-cutting plan that HSBC announced in 2011, when it said it would reduce about 30,000 positions over the next three years. DealBook »
BlackRock Changes Course on Bond Trading Platform  | The giant asset manager “is retreating from plans to allow customers to trade corporate bonds directly with one another on its own platform,†The Wall Street Journal writes. WALL STREET JOURNAL
J.C. Penney Hires AlixPartners to Find Cost Savings  |Â
WALL STREET JOURNAL
Billabong Agrees to Extend Takeover Talks  | A group led by a former director of Billabong and Sycamore Partners Management will have an additional 10 days to complete a report on the company’s earnings. BLOOMBERG NEWS
Springer Science Said to Attract Private Equity Interest  | Reuters reports: “Five private equity groups are set to bid for Springer Science+Business Media, owned by private equity firm EQT and sovereign wealth fund GIC,†according to unidentified people close to the process. REUTERS
Jana Partners Muses on a Takeover for Rockwood  | The activist hedge fund Jana Partners said in a letter to investors that Rockwood Holdings, a specialty chemicals maker, might be worth $80 a share in a takeover, Bloomberg News reports. BLOOMBERG NEWS
Cautious Optimism Among Hedge Fund Managers  | More than half of hedge fund managers expected better performance this year than last, but 42 percent said 2013 would be difficult or somewhat difficult for the industry, according to a new survey by the professional services firm Rothstein Kass. NEWS RELEASE
Lloyds Banking Group Plans I.P.O. After Branch Sale Collapses  | The British bank is planning an initial public offering of part of its branch network after a deal fell through to sell the division to a rival British lender, Co-operative Bank. DealBook »
On the Road to Electric Cars, Fisker Broke Down  | “Fisker, with its technical problems, management turmoil and mounting losses, offers a cautionary tale in the fiercely competitive arena of alternative-fuel vehicles and of government subsidies for start-up businesses,†The New York Times writes. “The company’s messy demise will fall under the glaring spotlight of a Congressional hearing on Wednesday.†NEW YORK TIMES
Shapeways Attracts $30 Million to Make 3-D Printing Mainstream  |Â
NEW YORK TIMES BITS
Regulators to Restrict Big Banks’ Payday Lending  | Federal regulators are expected to crack down on short-term, high-cost credit offered by large banks like Wells Fargo and U.S. Bank. DealBook »
Former Head of Dewey Pays to Settle Mismanagement Claims  | The former head of the law firm Dewey & LeBoeuf, Steven H. Davis, has agreed to pay more than half a million dollars to resolve claims that mismanagement led to the firm’s collapse. DealBook »
Baucus, Powerful Finance Chairman, Will Leave Senate  | Senator Max Baucus will retire from the Senate after 36 years, Jonathan Weisman reports in The New York Times. No other lawmaker on Capitol Hill has more former aides working as tax lobbyists, representing blue-chip clients that include financial firms, according to an analysis of lobbying filings. DealBook »
Top product Liability Lawyer Leaves Skadden for Quinn Emanuel  | Sheila Birnbaum, a top product liability defense lawyer, is leaving Skadden, Arps, Slate, Meagher & Flom to join Quinn Emanuel Urquhart & Sullivan. DealBook »
Accounting Board Taps Next Chairman  | Russell G. Golden, a former partner at Deloitte & Touche, was named chairman of the Financial Accounting Standards Board. NEW YORK TIMES
At S.E.C., White Adds to Her Roster of Top Officials  | Anne K. Small, a special assistant to President Obama, will join the Securities and Exchange Commission as its general counsel. DEALBOOK
This post has been revised to reflect the following correction:
Correction: April 24, 2013
An earlier version of this post misspelled the name of a law firm. It is Quinn Emanuel Urquhart & Sullivan, not Urguhart.
