Former Tyco leaders begin fraud defense

The Tyco International executives accused of pilfering company funds for lavish homes and decadent parties spent the money like lottery winners, but they “didn’t win the jackpot, they stole it,” a prosecutor said Tuesday.

In opening arguments for the trial of L. Dennis Kozlowski, the former Tyco CEO, and Mark Swartz, the company’s former CFO, prosecutor Kenneth Chalifoux said the men raided the company’s bank accounts to steal $600 million and then lied about it.

On his way into the courtroom, Kozlowski said: “I’m just glad it’s finally getting under way.” Both men could get up to 30 years in prison if convicted of all charges against them.

The pair are expected to argue that the millions they are accused of stealing were actually loans and bonuses approved by the board and disclosed to outside auditors.

Report

Energy Department sees rise in natural gas prices

The Energy Department said Tuesday it expected wholesale natural gas prices to be 9 percent higher this winter than last, between $4.50 and $5 per 1,000 cubic feet.

How much of the increase will be felt by homeowners and businesses will depend largely on how cold it gets, federal officials said.

If a severe winter increases fuel use, residential users of natural gas could pay an average of nearly $1,000 this winter to heat their homes, about 22 percent more than last winter, according to the Energy Department.

Food & beverage

Kraft to introduce socially-friendly coffee

Kraft Foods Inc., the largest U.S. food and beverage company, said Tuesday it would sell coffee from farms in Latin America that are certified by a conservation group as socially and environmentally responsible.

In the first year of the program, Kraft will buy 5 million pounds of coffee beans from farms in Brazil, Mexico and Central America that are approved by the Rainforest Alliance, said Kraft spokeswoman Patricia Riso.

She would not say how much coffee Kraft buys overall each year.

The price of the certified coffee, which will be in stores starting in 2004, has not been determined, Riso said.

Whistleblower

Coke settles allegations

The Coca-Cola Co. has agreed to pay $540,000 to a former finance manager to settle a whistleblower lawsuit that led to a criminal investigation of fraud allegations at the world’s largest beverage maker.

Matthew Whitley sued for wrongful termination in state and federal court in May.

The suit accused Coke of rigging a marketing test three years ago to inflate the popularity of Frozen Coke at Burger King restaurants in Virginia.