[JURIST] Leading Monday's corporations and securities law news, Florida's insurance regulation commissioner [official website] announced subpoenas have been sent to officials at 17 insurance companies, including units of American International Group Inc. [corporate website], Chubb Corp., Swiss Re AG [corporate website], Berkshire Hathaway Inc.'s unit National Indemnity Company of the South and Hannover Re AG [corporate website], over a probe into alleged improper use of reinsurance to overstate the value of companies. The Florida probe is the latest investigation, which includes the SEC [official website] and New York Attorney General Eliot Spitzer [official website], into the widespread abuses by the insurance industry. The purported deals under investigation used finite reinsurance, a form of insurance which limits the amount of risk transferred from the insurance company to the reinsurance company through the use of various provisions. If the risk in the reinsurance transaction is misstated, the company may receive favorable accounting numbers for which it does not deserve. Read the Florida insurance regulation commissioner press release. AP has more.

In other news…

• Billionaire investor and former New York Stock Exchange director Kenneth Langone is leading a group of seat holders on the NYSE [corporate website] in an attempt to purchase the Big Board. The move would override the NYSE's merger with Archipelago Holdings Inc [corporate website]. Langone feels the deal [NYSE press release, PDF] is too generous to Archipelago and does not represent the true value of the NYSE. AP has more.
• Ken Rice, the former chief executive of Enron's Internet business, told jurors he lied to analysts about the capabilities of the company's broadband network in an effort to bolster the value of Enron's [corporate website; JURIST Hot Topic news archive] stock. Rice also implicated former Enron CEO Jeff Skilling [Wikipedia profile] and four of the five former Enron Broadband Services (EBS) [Enron overview] executives who are currently on trial as accomplices. Rice has already reached a plea bargain [PDF] with prosecutors. Skilling is not being tried in these proceedings, however the five former EBS executives on trial are charged with 170 counts of conspiracy, wire and securities fraud, insider trading and money laundering. Read the indictment [PDF] against the five executives and the original indictment against Ken Rice [PDF]. The Houston Chronicle has more. In related news, Jeff Skilling was ordered to leave the courtroom during the trial of the five executives because court rules prohibit witnesses or even potential witnesses from observing the proceedings. Skilling had been taken off the defense witness list but his name was a recent added back to the defense list. The Houston Chronicle has more and continuing coverage of the Enron Broadband Services trial.
• Valero Energy Corp. [corporate website] announced plans to acquire Premcor Inc. [corporate website] for $6.9 billion in cash and stock. The new company would be the largest refiner of crude oil in North America. The boards of directors of both companies have already unanimously approved the acquisition. The deal now must get approval from Premcor's shareholders and customary regulatory approvals. The transaction is expected to be completed by December 31. Read the Valero press release. AP has more.
• Huntington Bancshares Inc. [corporate website] said it would offer to pay a $7.5 million fine to end a SEC investigation into its accounting practices related to auto leases from 2002 and earlier. The deal also calls for separate civil fines to be paid by Thomas E. Hoaglin, the bank's chairman, president and chief executive officer, Michael J. McMennamin, its former vice chairman and chief financial officer, and former Controller John D. Van Fleet. The SEC still has to agree to the deal, although investigators have recommended the commission accept it. Huntington has already reached agreements over its accounting practices with the Federal Reserve Bank of Cleveland and the US Comptroller of the Currency [official website]. Columbus Business First has more.
• Constellation Brands [corporate website], the world's largest winemaker, said it is considering a rival bid for Allied Domecq [corporate website], the UK drinks company which last week accepted a £7.4 billion ($14 billion) takeover bid from Pernod Ricard [corporate website] of France and Fortune Brands [corporate website] of the US. Constellation would need to find partners to bid on Allied as it is not large enough to bid on the company alone. According to reports, Allied would have to pay a penalty of £ 37 million if it accepted a rival takeover bid within half a year. BBC News has more.
• As previously reported on JURIST's Paper Chase, Arthur Andersen [Wikipedia profile] has reached a settlement with WorldCom [now MCI Inc. corporate website] investors over accusations the company violated securities laws when it failed to protect WorldCom investors from the $11 billion accounting fraud which led to WorldCom's collapse. US District Judge Denise Cote said an approval hearing on the settlement would occur on Tuesday. The trial had reached its fifth week before the announcement of the deal. Arthur Andersen was the only defendant left in the trial after major investment banks agreed to pay more than $6 billion in settlements [New York State comptroller press release] and a dozen former board members settled the case for $24.75 million before the trial began. Click for information from the WorldCom litigation. AP has more.

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