EU proposal seeks to shield taxpayers

EU proposal seeks to shield taxpayers

BRUSSELS

European officials proposed Wednesday a new system of financial regulations that aims to keep bank failures from costing taxpayers billions and bankrupting governments.

Because many European governments already are overburdened with debts, rescuing their failed banks risks bankrupting some of them. Ireland has had to ask for an international bailout for that reason, and investors fear Spain may be next.

The banks, in turn, own huge amounts of their governments’ bonds, which drop in value when investors lose confidence in the country’s financial future. The result is that any fall in confidence in either the banks or the government tends to create a downward spiral requiring foreign financial aid.

Under the European Commission’s proposal, banks that posed no systemic risk to the stability of financial markets simply would be allowed to fail. Those whose failure did threaten to become unmanageable would be propped up in part by having unsecured creditors of the bank, such as bondholders and shareholders, take losses rather than having governments give them taxpayer money.

Ruling: Chesapeake meeting to proceed

OKLAHOMA CITY

A federal judge denied a shareholder request to postpone the annual meeting of Chesapeake Energy Corp. on Wednesday, clearing the way for the nation’s second-largest natural-gas producer to convene the shareholder’s meeting Friday as planned.

U.S. District Judge Vicki Miles-LaGrange denied a motion that sought a preliminary injunction to prevent Oklahoma City-based Chesapeake from moving forward with the meeting to give the company more time to provide shareholders with information about CEO Aubrey McClendon’s compensation and loans he secured against his stake in company wells.

Shareholders claimed they needed the information to make informed votes at the meeting and determine whether the company’s board of directors has been doing its job.

Some LinkedIn passwords stolen

LONDON

Business social network LinkedIn said Wednesday that some of its users’ passwords have been stolen and leaked onto the Internet.

LinkedIn Corp. did not say how many of the more than 6 million passwords that were distributed online corresponded to LinkedIn accounts. In a blog post Wednesday, the company said it was continuing to investigate.

Graham Cluley, a consultant with U.K. Web security company Sophos, recommended that LinkedIn users change their passwords immediately.

LinkedIn has a lot of information on its more than 160 million members, including potentially confidential information related to jobs being sought. Companies, recruiting services and others have accounts alongside individuals who post resumes and other professional information.

Vindicator wire reports