The Philadelphia Inquirer from Philadelphia, Pennsylvania on January 7, 1992 · Page 16
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The Philadelphia Inquirer from Philadelphia, Pennsylvania · Page 16

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Tuesday, January 7, 1992
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316 Pfcla&dpfiia Inquirer DOW JONES INDUSTRIALS -1.35 treas, bonds smb. yielo -0.04 DOLLAR VS. YEN -fl.70 BUSINESS TUESDAY January 7, 1992 6-B By GLENN BURKINS personal s-JpftifF finance I z-J I QwcA: refunds that don't pay ; Would you take a short-term loan ' with an annual interest rate of 100 ' percent? As incredible as it seems, each year at this time, millions of people do just that. That's what happens, In effect, when people pay fees to tax preparers in exchange for lightning-fast refund checks. The fast-refund services have been around for several years, and each year they seem to grow more popular. But are they a good deal for consumers? Many critics, including . many tax preparers, say they are a " lousy way for people to borrow money. "It's just a way that some tax preparers make money from people who don't have money," said Jack Bro-sius, owner of Adams Accounting in 1 Philadelphia. "It's cheating the tax- ; payer." Brosius is one of many tax preparers in the Philadelphia area who snub the program. From a financial standpoint, they say, most people would be better off if they waited a few extra days or weeks for an IRS refund. 'Waste of money' "We think it is a waste of money," said Bill Fegley of Fegley & Associates in Plymouth Meeting, another critic. Here's how the services work: Taxpayers who are owed year-end refunds can get the money in about five days by paying fees to their tax preparers. The fees average about $30. But to use the service, the tax-. payer also must have his or her tax return filed electronically. And that, too, costs extra between $30 and $35. ; The IRS says about 153,000 people in the Philadelphia area filed electronically last year. About 300,000 users are expected this year. But the agency does not monitor how many electronic filers also use the quick- refund program. That's because the ; IRS is not associated with the pro-; gram. People who use the fast-refund service actually are getting short-term bank loans, though some may not know it. Tax preparers who offer the service contract with banks to make loans based on the IRS refunds that are expected. The money is repaid to the banks, via the IRS, usually '. in about two to three weeks. Credit checks required Like most would-be borrowers, people who use the quick-refund services must pass credit checks. ; And if for some reason the bank is not repaid, the taxpayer is responsible. But the real problem, critics say, is ; the high fees that taxpayers are charged to get their own money a few weeks early. For example: If a person paid $30 to get a $900 refund loan check from a bank, the annual interest rate on that loan would come to 85.5 percent, assuming the bank were repaid in three weeks. Some people use the services to get even smaller refunds, some as small as $300, experts say. In that case, the annual interest rate would be 173 percent. But the cost of getting a fast refund is even higher once the electronic-filing fee is added. In most cases, the total cost is about $70 to $80. For people who would rather keep their money, the best way to get a quick refund is to file early. Tax preparers said you could get an IRS refund in about three weeks if you filed your return by mid-February. Another strategy is to have your return filed electronically without the fast-refund service. Instead of paying about $75, you would pay about $35. Three-week refund If takes about three weeks to get an IRS refund check if you file electronically, and even less time if you have the refund deposited directly into a bank account. ' Although the IRS is not associated with the fast-refund program, it has established some guidelines for tax preparers who offer the service: For example, the fee for filing an - electronic return cannot be based on the size of a taxpayer's refund. And since the fast refund actually is a bank loan, the firms cannot use the .word refund when promising you fast cash. Meanwhile, though most people who file electronic returns eventually get refunds, the service also is open to people who owe money to the IRS. .' This is the first year that the IRS ; has accepted electronic returns from people who owe. Taxpayers who use the system have until April 15 to pay any balance due, regardless of their filing dates. Send your question on personal finance to Glenn Burkina, The Inquirer, Bo 8263, Philadelphia 19101. Questions cannot be answered personally. Book alleges Trump did business with mob By David Johnston Inquirer Sun Writer ATLANTIC CITY An unauthorized biography asserts that throughout his adult life, Donald Trump has done business with major organized-crime figures and performed favors for their associates. If the charges are true, it would challenge the integrity of casino regulation in New Jersey. Trump: The Deals and the Downfall, by Wayne Barrett, asserts that the New Jersey Division of Gaming Enforcement has failed to examine 1991 U.S. sales hit eight-year low The news underscored U.S.-Japan tensions on the eve of President Bush's talks there. By Frederick Standish AuedMti Prtu DETROIT Sales of North American-made cars and trucks skidded to the lowest level in eight years in 1991, as the stubborn recession kept worried consumers out of the showroom and the Big Three automakers faced rough competition from Japanese vehicles. U.S. automakers said yesterday that they sold 9,740,814 domestic cars and trucks last year, down 10.3 percent from 10,854,988 in 1990. Total sales, including imports, medium- and heavy-duty trucks, fell to about 12.3 million units from about 14 million in 1990. Sales were last as low as 12.3 million units in 1983. The decline was disclosed on the eve of President Bush's trade meeting with Japanese leaders and underscored the tensions between the United States and Japan. About three-fourths of the $41 billion-plus U.S. trade deficit with Japan is in automobiles and auto parts. The Honda Accord, made in Ohio and Japan, was America's bestsell-ing car for the third straight year, and the Ford F-Series truck was the bestselling vehicle overall for the 10th straight year. Sales of cars and trucks marketed by General Motors Corp., Ford Motor Co. and Chrysler Corp. in 1991 declined 12.6 percent over the year before, far more than the 5 percent decline reported by Japanese automakers. The Big Three held 70 percent of the market last year, down from 72.1 percent the year before. The Japanese held 26.5 percent, up from 23.5 percent in 1990. At Lukens, little joy at strike's end By Lem Lloyd Special to The inquirer For 20 years, Bob Cazille has worked in the Coatesville steel mills. So did his two brothers and his father before him. Come Thursday, Cazille and 1,300 other workers at Lukens Inc. will vote whether to end their bitter 14-weekold strike and return to work. Cazille said he didn't know much about the new contract offer yet. Union members will get their first look at the proposal today at a union meeting. Lukens' union workers went on strike Oct. 1 seeking their first pay increase in nine years and better health and pension benefits. According to union sources, under the tentative settlement reached Sunday, wages will increase over the term of the four-year pact by more than $2.25 an hour, bringing the average hourly wage to more than Midlantic Corp. shifts and pares management By Andrew Cassel Inquirer Staff Writtr Midlantic Corp. said yesterday that it was streamlining its management and launching an in-house efficiency study in an effort to cut costs and make the New Jersey-based bank holding company less bureaucratic. Midlantic, which operates Midlantic National Bank in New Jersey and Continental Bank in Pennsylvania, heralded the development as a continuation of a restructuring begun over the summer, when the company took a $415 million loss and put more than $6 billion of its assets up for sale. Garry J. Scheuring, who took over as chairman and chief executive officer of Midlantic last year, called the management changes "a logical step in positioning the bank for the future. It's a step that will create efficiency." The changes will centralize management across the company's New Jersey and Pennsylvania divisions, how Trump's life "intertwines with the underworld." It also alleges that the Casino Control Commission has denied licenses to others for conduct far less serious than what the book alleges Trump has done. Key among these assertions is that in 1983, after Trump had obtained a casino license, he met with Anthony "Fat Tony" Salerno, head of the Gen-ovese crime family, at the Manhattan townhouse of Roy Cohn, a lawyer who represented both men. The book cites an unnamed eyewitness as its source. HIE AUTO Car and light-truck sales in the U. S. 1991 figures as reported by automakers. Imports and domestics, in millions. n . 10- s2J 0 tJLJLJlILJUL!-JItlIL-ILJL-iILJU ft '75 '77 '79 "81 "83 '85 : 'Beginning in 1980, passenger vans SOURCES: Motor Vehicle Manufacturer's Association Individually, GM's sales dropped 12.5 percent, Ford's fell 13.6 percent and Chrysler's 11.2 percent. , Among the Japanese automakers, Toyota's sales declined 4.4 percent, Nissan's slumped 6.3 percent and Honda's dropped 6 percent. In 1983, as the nation began to emerge from a recession, automakers sold 11.7 million vehicles. The depressed 1991 VS. sales pace spread to Japan, where new-vehicle sales were off 3.9 percent, the first year-to-year decline in a decade. (See AUTOMOBILES on 11-B) As a bitter walkout winds down, workers sense a deep loss of faith in the company. $14.46. At the end of the contract, workers with 30 years of experience will be guaranteed a monthly minimum pension of $1,400. As union members get ready to review the proposed settlement, Cazille and many other strikers are certain of one thing: Life at the mills will not be the same. Lost will be the good will they once had for a company that has employed generations of residents from this western Chester County city. Before the strike began in October, Cazille said yesterday, he couldn't have been happier working as a steel inspector in the pickle tanks. with single officers in charge of individual lines of business in both states. Frank T. Van Grofski, for example, will head corporate banking at both Midlantic and Continental, while Alfred J. Schiavetti Jr. will be in charge of credit management in both divisions. Until now, the banks have each had their own operations heads for each line of business. The change will create "a less complex bank," Scheuring said. "It allows us to develop and market products more consistently and we think more efficiently." Midlantic also will launch a compa-nywide study of its operations with an eye to increasing efficiency, a move that will eventually mean cuts in the bank's workforce of 6,200 in New Jersey and 1,800 in Pennsylvania, Scheuring said. "I'm sure this will lead to staff reductions, but what level and what amount I don't know," he said. (See MIDLANTIC on 11-B) Other casino executives have had their licenses revoked or were denied a license just for being photographed in the company of major organized-crime figures, including Salerno. At the time of the purported meeting, Trump was using a concrete company called S&A to build his Trump Plaza condos in Manhattan, according to federal court records cited in the book. S&A was controlled by Salerno and Paul Castellano, then head of New York's Gambino crime family, according to those same re INDUSTRY I Imports and domestics, in millions. 3 JU JUU JuULI '87 '89 "91 '75 '77 '79 '81 '83 "85 "87 '89 '91 previously reported as cars were counted as trucks. : : and auto manufacturers Philadelphia-area vehicle sales CARS 1987 1988 1989 1990 1 991 Domestic 189,872 193,144 166,403 .' 143,499 97,930 Imported 103,599 100,554 93,076 90,379 65,003 TRUCKS Domestic 75,319 78,551 75,157 67,272 50,978 Imported,. 14,857 11,101 9,508 10,798 8,428 Includes Philadelphia, Bucks, Delaware, Chester, Montgomery, Burlington, Camden, Gloucester and New Castle Counties. Through October. , SOURCE: ft, L. Polk 4 Co. "That's a crazy thing, isn't it to say you like your job. But everybody liked Lukens," said Cazille. "But when we go back to work after this strike), how are we supposed to act knowing that this company tried to destroy us?" he asked. Striker Tom Wilson said he used to dream about haying his son work with him at Lukens. "When he was 10 years old, I couldn't wait for him to go into the mill," said Wilson. But when his son recently told him he was thinking about putting in an application at the company, Wilson pleaded against it. "I told him I'd pay all his bills, let him move back in Index ' Defying conventional wisdom, Chrysler is producing a new Jeep at an inner-city plant staffed by older workers. Page 9-B. IBM says it will make a belated entry into the US. notebook-computer market Feb. 25. Page 10-B. The New Stock Exchange opened the yearlong commemoration of its 200th anniversary. Page 10-B. Dozens of Wall Street firms are expected to settle with the Securities and Exchange Commission allegations that they inflated orders for the debt of government-backed agencies. Page 11-B. PNC Financial Corp is shifting executives in a move that is likely to increase centralization at the Pittsburgh bank holding company. Page 11-B. AMfcX 13-B OTCbid&ask 12-B Dividends 12-B OTCPhila. 12-B Futures 10-B PhitEx listings 9-B Marketplace 7-B Produce 12-B Mutual funds 10-B Sales, earnings 12-B NASDAQ 12-B Shipping 12-B N.V. bonds 11-B Treasury bills 10-B NYSE 7-B U.S. securities 10-B cords. The book alleges numerous other dealings that Trump had with officials of mob-controlled concrete firms and with mob-influenced unions, and often cites government documents and interviews with named individuals. Trump aide Norma Foederer said yesterday that Trump had not read the book. Another spokesman, Steve Man-gione, issued a statement from Trump saying that Barrett is "a second-rate writer who has had numer- The Philadelphia Inquirer DARVL MILLS The Phlledelpnia Inquirer anything" but that, he said. How to heal the wounds of this bitter strike is a job both union leaders and company officials are concerned with. Many strikers said yesterday that they felt betrayed by a company where more than 25 percent of the union members have labored for at least 25 years. Lukens spokeswoman Evelyn Walker said the company wanted to promote a "harmonious working environment." Officials were pondering ways to deal with the tension. Harmony may be hard to achieve, particularly between the strikers and the 112 union members who decided to cross the picket line and return to their jobs. Several of the steelworkers in front of their union hall yesterday said they planned to employ the silent treatment when dealing with those whom they called "scabs." Bookstore is dying on Chestnut St. By Larry Fish fiupiirar SUH Writer Joseph A. Gerber was trying to explain yesterday why he will miss his regular bookstore, Robin's at 1837 Chestnut St., when it closes later this week. "It was a secret place," Gerber said, where he could duck in for a moment's browsing while going to or from his law offices in the nearby Stock Exchange Building. If Robin's was a secret, it tried hard not to be. But 17 years after opening on Chestnut, Robin's saw a recession and the opening of three chain-owned bookstores within little more than one block in the last year or so: Borders on Walnut, Brentano's at Liberty Place and Encore on Market. The result, says owner Larry Robin, is one less independently ous literary failures, who has bedn writing negative stories about me for the past 15 years. The book is another example of Mr. Barrett's personal prejudice and animosity towards me. The book is boring, non-factual and highly inaccurate." Barrett, 46, is the politics reporter for the Village Voice, where for the last 14 years he has focused on allegations of corruption, particularly ties between leading New York politicians and mobsters. He co-authored City for Sale, a 1988 account of cor-(See TRUMP on 13-B) Yesterday's stocks Dow Jones industrial average. Close 3,200.13 Down 1.35 3175 -3150 1 1 1 I.J j I I I J I I . i a . I , , I I . I . I ' 9:3010 11 12 1 2 3 4 A.M. P.M. 3125 The Philadelphia Inquirer Dow dips after 11 up days Ends over 3,200 in heavy trading NEW YORK - Blue-chip stocks ended slightly lower yesterday, with the Dow Jones industrial average falling from its record after 11 straight gaining sessions. ; The 30-share Dow, which had set records in the last six sessions, fell 1.35 points to close at 3,200.13. But in the broader market, advancing issues outpaced losers 1,059 to 787 in heavy volume. And the NASDAQ composite index of over-the-counter stocks surged 5.25 points to close at 597.90, its seventh straight record close. New York Stock Exchange volume totaled an estimated 242.01 million shares as of 4 p.m., up from 219.17 million in the previous session. Consolidated NYSE volume was 317.66 million shares. "The market spent the day catching its breath," said Robert Walberg, analyst at MMS International. "But they had a hard time selling it." Walberg, noting that the Dow was stalling at the 3,200 mark, said a 2 percent to 3 percent pullback was likely in the next 10 days. Walberg said that the Big Three U.S. automakers had reported slightly better-than-expected 10-day car sales, and the companies' stocks rose in active trading. General Motors rose 1 to 33Vj, Ford climbed Vi to 30 and Chrysler gained to 13. Walberg said the buying of the carmakers' shares also stemmed from speculation that President Bush would get trade restrictions lifted by Japanese officials when he met with them in Japan this week. Among other stocks, traders said a Merrill Lynch analyst raised her rating on Lukens Inc. after the company reached a settlement with striking steelworkers. The stock closed up 2V4 to 44. The American Stock Exchange index closed up 0.44 at a record 399.27, surpassing Friday's high. The Standard & Poor's index of 500 stocks lost 1.38 at 417.96. The S&P industrials lost 1.72 to 494.06. The NYSE composite index of all listed common stocks fell 0.50 to 229.85. The Wilshire Associates Equity Index the market value of NYSE, American and NASDAQ issues was $4,055,917 billion, off $5,055 billion, or 0.12 percent. owned store in a field increasingly dominated by big retailers. Less than a quarter of all book- , stores are chain-owned, according to the latest data from the American Booksellers Association, but they brought in nearly ; 40 percent of all sales. The final day for the Chestnut Street store is to be Thursday, and "most" of the six employees will be laid off, Robin said. The family's other store, on South 13th Street, "is holding pretty even," '. Robin said, and remains open. Like many other of Robin's " longtime customers, Gerber was ' picking through the stock, now selling for 50 percent off, and " trying to describe why he preferred the small, narrow store to . one of the new "superstores" with (See ROBIN'S on 11-B) -3225

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