IN THE COURTS

GOVERNMENT CONFIRMS CRIMINAL INVESTIGATION INTO HOLLINGER INC.

Federal prosecutors confirmed for the first time Tuesday they are conducting a criminal investigation of newspaper tycoon Conrad Black, his former top deputy David Radler, and Hollinger Incorporated.

The government acknowledged the investigation in court papers in which it asked to intervene in a Securities and Exchange Commission lawsuit filed in November against Messrs. Black and Radler, and Hollinger Incorporated. The SEC alleges they engaged in a “fraudulent and deceptive scheme” to take cash and other assets from Chicago-based Hollinger International, the parent company of the Chicago Sun-Times, and concealing the actions from shareholders.

The government asked to delay until August 1 the release of a document that the defendants requested from the SEC “to protect the integrity of the related criminal investigation.”

Releasing that document would impair the government’s criminal investigation, the motion says. Prosecutors requested a hearing for today.

Transactions under investigation include “various purported ‘non-competition payments’ that were made to Black, Radler, Hollinger Inc. and others in connection with Hollinger International’s sale of newspaper publications to third parties.”

The investigation also seeks to determine whether fraud occurred in connection with Hollinger International’s sale of newspaper publications to companies controlled by Messrs. Black and Radler, as well as other transactions between Hollinger International and the defendants in the SEC lawsuit and their companies.

A special committee of Hollinger International’s board of directors is also suing Mr. Black and his associates to recover what they say are hundreds of millions of dollars that were siphoned from the company. Mr. Black has denied wrongdoing.

– Associated Press

TECHNOLOGY

ORACLE PROFIT FALLS ON PURCHASE COSTS, SALES MISS

Oracle Corporation, the world’s third-largest software maker, said third-quarter profit fell 15% on costs to buy PeopleSoft Inc. Revenue lagged behind analysts’ expectations.

Net income fell to $540 million, or 10 cents a share, from $635 million, or 12 cents, a year earlier, the Redwood City, Calif.-based company said in a statement yesterday. Sales rose 18% to $2.95 billion in the quarter ended Febrary 28, missing the $3.07 billion average estimate in a Thomson Financial survey.

Oracle recorded more of the costs sooner than some analysts expected after its $10.3 billion acquisition of PeopleSoft in January. The chief executive, Larry Ellison, pushed the deal through an 18-month fight to lessen Oracle’s reliance on database software, and his planned takeover of Retek Inc., announced Monday, may further expand sales of business-management applications.

Shares of Oracle fell 22 cents to $12.27 in extended trading after the report. They had dropped 16 cents to $12.49 at 4 p.m. New York time in Nasdaq Stock Market composite trading and have declined 9% this year.

– Bloomberg News

PEOPLE

MARSH SAYS PRESIDENT GARVEY LEAVES, MALLOY PROMOTED

Marsh & McLennan, the world’s largest insurance brokerage, said Peter Garvey resigned as co-president of the company’s brokerage unit four months after taking the position.

William Malloy, who previously was co-president with Mr. Garvey, was promoted to president, the company said in a statement. Mr. Garvey, 49, left for personal reasons, New York-based Marsh said.

Marsh appointed Messrs. Garvey and Malloy, 45, co-presidents in November after demanding the resignation of their predecessor, Roger Egan, in the wake of bid-rigging accusations by New York Attorney General Eliot Spitzer. Mr. Garvey’s departure adds to executive turnover at Marsh, which lost brokers and clients as it settled Mr. Spitzer’s allegations in January for $850 million.

“Pete made this decision after careful consideration, and we wish him well,” Marsh’s chief executive, Michael Cherkasky, said in the statement.

Mr. Cherkasky took control of Marsh 11 days after Mr. Spitzer sued on October 14 with accusations it rigged insurance quotes and steered business to insurers that paid hidden fees.

– Bloomberg News