Business Desk
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

LABOR
IN CITY AND STATE, UNEMPLOYMENT RATE FALLS
The seasonally adjusted unemployment rate decreased in the city and throughout the state last month. The state Department of Labor reported a gain in private sector jobs of 1.4%, or 41,500, since August 2004. The unemployment rate dropped in August to 5.1% from 5.7% in July, part of a yearlong trend. The unemployment rate was 6.8% a year ago. The unemployment rate in the state excluding the city is 4.5%, down 0.2% from July. The U.S. Labor Department reported jobless claims rose by 71,000 last month, of which 68,000 have been attributed to people who lost their jobs since the hurricane hit.
– Special to the Sun
INSURANCE
EIGHT FORMER MARSH EXECUTIVES ARE INDICTED
Eight former Marsh & McLennan executives were indicted for fraud, setting the stage for the first trials in the New York attorney general Eliot Spitzer’s probe of bid-rigging at the world’s largest insurance broker. Former managing directors William Gilman and Joseph Peiser and six others were accused of fixing prices to steer business to insurers that paid hidden fees. All pleaded not guilty to a total of 37 felony counts in New York County Supreme Court yesterday.
– Bloomberg News
MISSISSIPPI ATTORNEY GENERAL SUES ALLSTATE, STATE FARM
Allstate, State Farm Mutual Automobile Insurance, and three other insurers were sued by the Mississippi attorney general, Jim Hood, for refusing to cover homes damaged by floods in the aftermath of Hurricane Katrina.
The lawsuit, filed yesterday in state court in Jackson, Miss., seeks to nullify policies that exclude coverage for hurricane damage caused by flooding. The clause is “unreasonably favorable” to insurers and “oppressive” to policyholders, Mr. Hood said in the suit. “The attorney general is challenging the validity of contracts in the state of Mississippi,” a spokesman for Bloomington, Ill.-based State Farm, said. “That threatens the foundation of the economy in that state and has enormous ramifications for every resident.”
– Bloomberg News
IN BRIEF
A federal bankruptcy judge approved a series of requests yesterday by Northwest Airlines to allow the airline to continue operating normally in the wake of its Chapter 11 bankruptcy filing … The Blackstone Group, the New York-based firm that’s raising the world’s biggest buyout fund, agreed to pay $1.71 billion for UICI … MasterCard said yesterday that it wants to raise as much as $2.45 billion in its initial public offering early next year, and said it expects to report a first-quarter 2006 net loss – and possibly even a full fiscal 2006 loss – as a result of the offering … Newell Rubbermaid will increase marketing and research and development spending, close one-third of its 80 manufacturing facilities, and eliminate 5,000 jobs … Fannie Mae said yesterday it plans to turn over 1,500 single-family homes it owns in its inventory of foreclosed properties to temporarily house victims of Hurricane Katrina … Ben Bernanke, chairman of the White House Council of Economic Advisers, said yesterday that the hurricane will have a “palpable effect” on the economy in the short term, hurting employment and growth in the third quarter.
– Bloomberg News and Dow Jones Newswires