Google Inc. is poised to make voluntary concessions that willend a 20-month U.S. antitrust probe of its business practiceswithout any enforcement action, two people familiar with the mattersaid.

Google, which has been under investigation by the Federal TradeCommission, is preparing a letter promising not to copy contentfrom rival websites without permission and to allow advertisers tocompare Google's ad-campaign data with performance on otherInternet search engines, one of the people said Dec. 16. That willclose the investigation without a lawsuit or settlement, said thepeople, who asked not to be identified because the matter isn'tpublic.

An end to the probe without any enforcement action would be ablow to Google's competitors including Microsoft Corp., Yelp Inc.and Expedia Inc., which formed an alliance to press the agency toact. They claim Google's dominance of Internet search, combinedwith favoring its own services in answers to queries, violatesantitrust laws and impedes competition.

Adam Kovacevich, a Google spokesman, declined to comment onwhether Google is preparing to announce concessions or any mattersinvolving the FTC. Cecelia Prewett, a spokeswoman for the FTC, alsodeclined to comment.

Audio Records of Swaps and Futures Trades Required byCFTC Rule

Derivatives traders will be required to keep audio records ofcommodities transactions under U.S. Commodity Futures TradingCommission rules completed in a private vote yesterday.

The regulation, revised by commissioners to limit the impact onsmaller brokers, could help CFTC's enforcement unit determinetraders' intent when later probing claims of market manipulationand false reporting, the agency said in a statement. It is alreadycommon practice for equities traders to make such audiorecordings.

Under the rule approved in a 5-0 vote, derivatives brokers andcertain members of exchanges and swap-execution facilities will berequired to record quotes, bids, offers, trading and prices thatlead to transactions whether communicated by telephone, voice-mail,mobile or other electronic media.

The CFTC backed away from requiring records of oralcommunications that lead to trades in grains, according to astatement. Companies will have a year to comply with theregulation.

The agency delayed consideration of the rule in September amidresistance from industry groups representing trading firms andexchanges.

Fed Stresses Bank Governance in Letter to Boards,Supervisors

The Federal Reserve stressed the responsibility of boards andmanagers for governance in a letter to banks and their supervisorsthat also outlined other priorities for oversight.

A bank's “board is expected to establish and maintain the firm'sculture, incentives, structure, and processes that promote itscompliance with laws, regulations, and supervisory guidance,” theletter, released yesterday in Washington, said. The letter alsocalled for managers to set “appropriate compensation and otherincentives that are consistent with the institutional riskappetite.”

Many of the items on the Fed's letter, such as heightenedstandards for capital and liquidity, are already under way as aresult of the annual stress tests and tougher supervisoryoversight. Governance is one area the Fed rarely discusses.

The Fed has been evolving its approach to large bank supervisionpartly as a result of the Dodd-Frank Act and also in response toits own shortcomings during the 2008-2009 financial crisis. The Fedsaid the guidance in the letter “does not apply to communitybanking organizations, defined as institutions supervised by theFederal Reserve with total consolidated assets of $10 billion orless.”

Treasury Plan Would Fund Rate Cuts on Mortgages inPrivate Bonds

Some struggling homeowners left out of current U.S. governmentmortgage-aid programs because their home loans have been packagedinto private securities could see their interest rates cut througha subsidy being considered by the Treasury Department.

Under the plan, the government would pay the difference betweenthe new and original interest rates to the owners of the loans forfive years in an effort to overcome investors' objections tomortgage modifications, according to a person familiar with planwho asked not to be identified because the initiative isn't finalor public. Details on the cost of the program and how it would bepaid for weren't available.

The proposal is among efforts by the Obama administration to aidhomeowners who remain under stress even as the housing marketbegins to recover. Borrowers who owe more than their homes areworth and who have mortgages that have been packaged into bondsissued by private securitizers have been unable to take advantageof existing government aid programs.

Borrowers who are current on their mortgage payments and who oweat least 25 percent more than the value of their properties wouldbe eligible for the program.

JPMorgan Wins Approval for First U.S. Physical CopperETF

JPMorgan Chase & Co. won regulatory approval for the firstU.S. exchange-traded fund backed by physical copper, which someindustrial users said may disrupt the market.

The proposed rule change by NYSE Arca Inc. to list JPM XFPhysical Copper Trust was approved, the regulator said in an orderon its website dated Dec. 14. BlackRock Inc. and ETF SecuritiesLtd. also have said they plan to start physically backed ETFs forindustrial metals in the U.S.

A group of industrial copper consumers including AmRod Corp.,Southwire Co. and Encore Wire Corp. and hedge fund RK Capital LLPopposed the plan, saying funds backed by copper would leave less ofthe metal available for manufacturers, creating shortages anddriving up prices. Senator Carl Levin, a Michigan Democrat, in Julyadvised rejecting the planned ETF.

A review released last month by an SEC division concluded thatasset flows from exchange-traded products tied to metals don't havea significant impact on the price of the commodity. Those findingswere disputed by the copper-users group.

Patrick Burton, a London-based spokesman for JPMorgan, declinedto comment on when the firm plans to introduce the fund.

ETFs trade like stocks, giving investors access to commoditiessuch as copper without taking physical delivery. ETF Securitiesstarted the first exchange-traded products backed by copper, nickeland tin in London in December 2010.

NYSE Arca Inc., the electronic platform of NYSE Euronext, filedwith the SEC to list and trade JPM XF Physical Copper Trust,according to an April 2 document. It sought approval to listBlackRock's iShares Copper Trust on June 19.

Separately, South Korea, the world's fifth-biggest copperconsumer, is expected to introduce an exchange-traded fund backedby physical metal this week.

The ETF will be listed on the Korea Exchange by the PublicProcurement Service, a government agency that manages strategiccommodities, Soon Jae Yoo, deputy director for stockpiling, saidDec. 10 at a seminar in London. The fund will be backed by metalstored in the agency's warehouses and will hold 1,100 metric tonsof copper when trading starts, he said.

Allianz Pays $12.3 Million to Settle SEC's IndonesiaBribe Claim

Allianz SE will pay more than $12.3 million to settle U.S.Securities and Exchange Commission claims that the Munich-basedinsurer made improper payments to government officials in Indonesiaduring a seven-year period.

The company was cited for violating the Foreign CorruptPractices Act after an SEC investigation found 295 insurancecontracts on government projects from 2001 to 2008 that wereobtained or retained by payments of $650,626 by an Allianzsubsidiary to employees of state-owned entities, the agency said ina statement yesterday. Allianz made more than $5.3 million inprofits as a result of the improper payments, the SEC said.

Allianz resolved the claim without admitting or denyingwrongdoing. Joel Cohen, a Gibson Dunn & Crutcher LLP partnerrepresenting Allianz, didn't immediately comment on the settlementwhen reached by telephone yesterday.

Morgan Stanley Fined $5 Million by Massachusetts onFacebook IPO

Morgan Stanley's handling of Facebook Inc.'s initial publicoffering, a deal that cost investors billions of dollars, broke adecade-old pledge to block investment bankers from influencinganalysts, according to Massachusetts regulators, who fined the bank$5 million.

A senior Morgan Stanley banker wrote a script that Facebook'sthen-treasurer used to update research analysts on the company'srevenue outlook before the IPO, according to a settlement documentwith Secretary of the Commonwealth William Galvin. He faultedMorgan Stanley for dishonesty, ethics violations and failing tosupervise employees — the first regulatory claims to stem from thebank's handling of the deal.

A plunge in Facebook's stock after it began trading in May hasfueled government probes and more than 40 lawsuits, with someinvestors claiming the social-network company failed to discloserevised forecasts before the IPO. The small size of MorganStanley's fine relative to investors' losses shows other regulatorsmay struggle to pin much blame on the bank, said Erik Gordon, aprofessor at the University of Michigan's Stephen M. Ross School ofBusiness.

Michael Grimes, the bank's global co-head of technologyinvestment banking who helped lead the IPO, and a spokesman forSecretary of the Commonwealth William Galvin's office, didn'trespond to messages seeking comment on the unidentified bankerdescribed in the complaint. Mary Claire Delaney, a spokeswoman forMorgan Stanley, declined to say whether Grimes is the banker.

Japan's FSA Joins Probe Into RBS Rate Setting, OfficialsSay

Japan's Financial Services Agency joined a probe into possiblerigging of interest rates at Royal Bank of Scotland Group Plc, tworegulatory officials with knowledge of the matter said.

The FSA earlier this month began reviewing RBS's Japan bankingand brokerage units on issues including compliance related to thesetting of London and Tokyo interbank offered rates, the peoplesaid, asking not to be named as the matter is confidential. Japan'sSecurities and Exchange Surveillance Commission began itsinspection last month, a government official with knowledge of thematter said at that time.

RBS, Britain's biggest taxpayer-owned lender, is among banksfacing allegations by regulators worldwide that they manipulatedLibor, the benchmark for more than $300 trillion of securities. TheFSA was scrutinizing RBS's Tokyo banking branch and RBS SecuritiesJapan Ltd. as of Dec. 5, the agency said on its website withoutdisclosing additional details. It informed RBS about the probe onNov. 27, one of the people said.

“We are fully co-operating with all of our regulators,” saidAtsuko Yoshitsugu, a Tokyo-based spokeswoman for RBS. She declinedto comment further.

Hiroshi Okada, a spokesman for Japan's FSA, declined to comment.RBS hasn't been accused of any wrongdoing by Japanese regulators,which conduct regular inspections of financial companies, accordingto the FSA's website.

Courts

Hedge Fund Managers Convicted by Jury of Insider-TradingScheme

Level Global Investors LP co-founder Anthony Chiasson and formerDiamondback Capital Management LLC portfolio manager Todd Newmanwere convicted of securities fraud and conspiracy for aninsider-trading scheme that reaped more than $72 million.

After deliberating a little more than two days, a federal juryin New York found both men guilty of conspiracy to commitsecurities fraud for a scheme to trade on Dell Inc. and NvidiaCorp. using illicit tips.

The panel found Chiasson, 39, guilty of five counts ofsecurities fraud, earning Level Global $68.5 million on inside tipstrading on the two technology company stocks. Newman, 48, wasconvicted of four counts of securities fraud related to trades oninside information that earned his fund about $3.8 million.

Manhattan U.S. Attorney Preet Bharara's office has charged 75people with insider trading since October 2009. Seventy-one ofthose pleaded guilty or were convicted after trial. Newman andChiasson, after the seventh trial connected to the probe, are theninth and 10th defendants convicted by federal juries inManhattan.

The two men face as long as 20 years in prison for securitiesfraud when they are sentenced by U.S. District Judge RichardSullivan on April 19.

Assistant U.S. attorneys Antonia Apps, Richard Tarlowe and JohnZach argued during the trial, which began Nov. 7, that the twoportfolio managers were part of a “corrupt chain” of analysts andinsiders at the two technology companies who swapped and traded onillicit tips. The scheme ran from late 2007 until 2009, prosecutorssaid.

Six people charged with being part of the insider-trading ringhave pleaded guilty and are cooperating with the U.S., includingJon Horvath, a former analyst at SAC Capital Advisors LP's Sigmaunit.

Steve Bruce, a spokesman for Diamondback, declined to comment onthe verdict. The fund told clients on Dec. 6 it will shut after theFBI raided its offices two years ago, prompting investors toflee.

Ford Loses Bid for $445 Million in Interest on IncomeTaxes

Ford Motor Co. can't collect $445 million in interest onoverpayment of income taxes, an appeals court ruled, saying theInternal Revenue Service didn't improperly calculate what thecompany was owed.

Ford sued the U.S. in 2008, claiming that the governmentshortchanged the auto company on interest accrued on overpayment ofcorporate income taxes. A federal judge in Detroit rejected Ford'sclaim in 2010, agreeing with the government that the U.S. hadcorrectly calculated the interest Ford was due on theoverpayment.

Ford asked the U.S. Court of Appeals in Cincinnati to overturnthe decision, contending that U.S. revenue procedure requiredinterest to accrue from the time the company deposited money withthe Internal Revenue Service. The appeals court yesterday ruledthat revenue procedure couldn't be used to support the company'sargument.

Jay Cooney, Ford spokesman, declined to comment immediately onthe court's decision.

The case is Ford Motor Co. v U.S., 10-1934, U.S. Court ofAppeals for the Sixth Circuit (Cincinnati).

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