In brief: Meltdown panel to grill Citi execs

WASHINGTON – A panel investigating the roots of the financial crisis will press current and former executives of Citigroup Inc. at hearings this week about the bank’s role in spreading trillions of dollars in risky mortgage debt through the banking system.

The hearings are the first by the Financial Crisis Inquiry Commission to focus on a single company. Witnesses include former Citi CEO Chuck Prince and former Chairman Robert Rubin, who was Treasury secretary during the Clinton administration.

The panel also will hear from former Federal Reserve Chairman Alan Greenspan, among others. The three days of testimony are designed to provide a firsthand accounting of decisions that inflated a mortgage bubble and triggered the financial crisis.

Jobless benefits renewal talks stall

WASHINGTON – Even as unemployment benefits expired Monday for tens of thousands of jobless workers, Democrats and Republicans renewed their haggling over whether to vote for an extension when Congress returns from its spring break next week.

In the latest round of skirmishing, Senate Democrats rejected Republican charges that they had backed away from a GOP proposal to give quick approval to a one-week extension that would be paid for with budget offsets.

“There were a lot of conversations going on and things were moving very quickly, but no deals were made,” said Jim Manley, a spokesman for Senate Majority Leader Harry Reid, D-Nev.

Failure to extend the benefits that expired Monday meant 212,000 unemployed people will lose benefits this week, according to the National Employment Law Project.

Guidant plea deal includes hefty fine

ST. PAUL, Minn. – Boston Scientific Corp.’s Guidant LLC division pleaded guilty Monday to two federal misdemeanor counts alleging it failed to properly disclose changes made to some implantable heart devices.

The deal calls for Guidant to pay more than $296 million, which federal prosecutors called the largest criminal penalty ever assessed against a medical device company. The agreement does not include probation or restitution to victims.

U.S. District Judge Donovan Frank said he will decide within three weeks whether to reject the plea deal, accept it as written, or accept it with modifications.

“Guidant’s guilty plea today is about accountability,” Assistant Attorney General Tony West, head of the Justice Department’s Civil Division, said in a written statement. “This successful prosecution serves as an important wake-up call to all those who seek to withhold vital information about public health and safety.”

Study: Pensions deeply underfunded

SACRAMENTO, Calif. – A Stanford University study commissioned by Gov. Arnold Schwarzenegger says California’s public pension funds are underfunded by as much as $500 billion.

The estimated shortfall applies to the retirement systems for California state and local government workers, teachers and University of California employees.

Analysts at those funds estimated their unfunded liabilities to be much lower. But a Schwarzenegger economist says they have been underreporting the gap between revenue and obligations.