The Baltimore Sun from Baltimore, Maryland • 63

i i iun i jul i aoo THE SUN Fed nominee questioned about 'golden parachute' Japanese rail executive tops billionaire list again Nominee John P. LaWare has an agreement with his company that ensures he will receive about $500,000 a year for five years even if he leaves. WASHINGTON (AP) President Reagan's latest nominee for a seat on the Federal Reserve Board faced a senator's suggestion yesterday that he tried to dodge taxes in negotiating a "golden parachute" compensation agreement. "I am concerned about it," Sen. William Proxmire, chairman of the Senate Banking Committee, said of the agreement at the end of a confirmation hearing for John P.

La-Ware, chairman of Shawmut National a bank holding company in Boston. Mr. LaWare said, "I'm not sure a tax dodge was involved" in the compensation agreement, which he said Shawmut offered to assure him that his annual Income of about $500,000 would be continued until he reaches age 65. He turned 60 on Feb. 20.

Golden parachutes are often used to reward executives when control or ownership of a corporation changes. In 1984, Congress required recipients of such arrangements to pay a 20 percent excise tax on the portion that the law considers excessive. In addition, corporations were barred from taking a tax deduction for the The richest ones The 21 richest people and families In the world, compiled by Forbes magazine. Nat worth Billionaire Country (blna) Yoshiaki Tsutsumi Japan $18.9 Taikichiro Mori Japan 18 Paul, Albert and Ralph Reichmann Canada 9 Shin Kyuk-ho Korea 8 Kenneth Cole Irving Canada 8 Harihuko Yoshimoto Japan 7.8 Sam Walton USA 6.5 Wan-lin Tsai Taiwan 5.6 Eitaro Itoyama Japan 5 Kitaro Watanabe Japan 5.2 Kenneth Roy Thompson Canada 5.1 Ramon Areces Spain 5 Donald and Samuel Newhouse USA 4.7 Yohachiro Iwasakl Japan 4.5 Yoneichi Otanl Japan 4.2 Y.C. Wang Taiwan 4 Jay Robert Pritzker USA 3.8 Barbara Cox Anthony and Ann Cox Chambers USA 3.6 Hirotomo Takei Japan 3.3 John Kluge USA 3 H.

Ross Perot USA 3 excessive payments. Under Mr. LaWare's agreement, which he acknowledged to be worth about $500,000 a year, the corporation itself is obligated to pay the 20 percent tax. Senator Proxmire estimated that would save Mr. LaWare about $200,000 in taxes.

"How do you Justify such an attempt to dodge the tax code?" Mr. Proxmire asked. The idea behind the 1984 law, he said, "was to discourage excessive payments which officers and directors vote themselves." "I'm not sure it's a dodge," Mr. LaWare said. "The tax is being paid, regardless," and the federal government is losing no money, he said.

There was no indication that the issue would affect Mr. LaWare's nomination. In fact, Mr. Proxmire told Mr. LaWare, "You are a very impressive candidate for the job." However, committee aides say some Democrats are reluctant to see the nomination approved because it would mean that Mr.

Reagan would have filled all seven seats on the board, which controls the nation's money supply. These senators are hoping that fellow Democrat Michael Dukakis will be elected president and can fill the Fed seat after taking office. Mr. LaWare, a registered Democrat, would replace Henry G. Wal-lich, who resigned.

The 14-year term would expire Jan. 3 1 2002. Mr. Proxmire told reporters he will confer with committee members before deciding whether the panel NEW YORK (AP) Yoshlaki Tsutsuml, head of Japan's Scibu Railway Group, is the world's richest person for the second straight year, Forbes magazine said yesterday. Mr.

Tsutsuml, 54, has a personal net worth of at least $18.9 billion, Forbes estimated in a report on some of the world's richest people, which appears in its July 25 issue. The magazine estimated his fortune at about $20 billion last fall in its first survey of the world's richest people. The designation again puts Forbes at odds with Fortune magazine, which, in its compilation of the world's billionaires in October, estimated Mr. Tsutsumi's holdings in railroads, hotels and golf clubs at $2.5 billion. The second-richest person on Forbes' list is also Japanese.

Taikl-chiro Mori, a former economics professor who owns 68 office buildings in Tokyo, is worth $18 billion, the magazine said. In the previous survey, Mr. Mori's fortune was put at $15 billion. Following the two Japanese are the Relchmann brothers of Canada, who have built a $9 billion fortune in real estate, Forbes said. Shin Kyuk-ho, a South Korean with interests in candy-making, hotels and real estate, is ranked fourth, with more than $8 billion-plus, and Kenneth Cole Irving, a Canadian with interests in oil distribution, paper and land, is ranked fifth, with $8 billion.

The United States still accounts for more billionaires than any other country, Forbes noted. The magazine said at least 47 American individuals and 20 U.S. families are worth more than $1 billion, compared to 32 in second-place Japan and 16 in third-ranked West Germany. The leading American billionaire is Sam Walton, head of Wal-Mart Stores, who ranks seventh worldwide with a net worth of $6.5 billion, Forbes estimates. After Mr.

Walton, the biggest U.S. fortunes are held by Donald and Samuel Newhouse ($4.7 billion), Jay and Robert Pritzker ($3.8 billion), Heat wave helps lift June Top retailers' sales, In billions Store, headquarters July Sears, Chicago $3,110 $2,830 9.8 Kmart, Troy, Mich. 2.600 2.430 7.0 J.C. Penney, 1.16 1.12 3.4 Apparel sector remains weak CHICAGO (Reuters) Hot weather that boosted sales of air-conditioners and a slight rise in apparel purchases helped retailers report nominal gains for June yesterday against a strong month last year. However, analysts warned that the apparel sector, which has been lagging for some time, has far from recovered.

They said some of the gains in apparel sales were attributable to inventory clearance mark-downs that began earlier than usual because of cool weather in May. "There are some signs that apparel is showing signs of life, but by no means has it turned up," said analyst John Landschulz of Mesirow and Co. Clothing sales started to slack off about a year ago as many women rejected the short skirts being hyped by retailers. Among large general merchandisers, Sears Roebuck Co. reported a 9.8 percent increase in June sales and said hot weather stimulated sales of air-conditioners, freezers and other cooling equipment.

Comparable store sales in June rose 5. 1 percent. Sears' Increase was attributed by Janet Mangano, an analyst with Jo- Aide to Japanese leader involved in stock scandal retail sales Jul' eng. '88 to date 87 to date chg. $12.34 $11.75 10.58 10.04 5.01 4.88 5.0 5.3 2.6 .880 19.6 4.35 3.73 18.4 1.23 7.0 7.53 5.72 32.0 .363 11.7 .901 22.3 .419 3.6 1.78 4.25 1.74 1.56 3.86 1.69 12.1 10.1 3.1 the company said.

In hard-goods lines, sales were strong in small appliances, home electronics and sporting goods with pharmacy business maintaining a strong year-to-date pace. Analysts are looking to August as the next indicator of consumer spending. Historically, July Is a clearance month. "We have been getting extraordinary, strong consumer-confidence readings," said Fabian Lindner, director of consumer research at the Conference Board. But Mr.

Landschulz of Mesirow noted that "a direct correlation between consumer confidence and sales" has not been demonstrated. settle back Gasoline prices rose sharply after a report by the American Petroleum Institute late Wednesday that U.S. inventories of unleaded gasoline declined by 5 million barrels in the previous week. Bob Baker, senior energy analyst at Prudential-Bache Securities attributed the decline to higher consumption coupled with refinery problems that have reduced production. Analysts also said the market had some residual nervousness from Wednesday's report that three members of the Organization of Petroleum Exporting Countries might request a meeting of the cartel.

The report "continued to be denied, and by late afternoon these hopes had faded and people were becoming more realistic," Mr. O'Connell said. should vote on the LaWare nomination this year. Should the panel recommend the nomination, it would be up to Majority Leader Robert C. Byrd, to determine wheth-, er the Senate should consider the nomination this year.

Monetary policy was barely mentioned at the hearing. Most questions were about the federal budget and trade deticits, me increasing share of U.S. debt held by foreign investors and Third World debt. Mr. LaWare said he is little concerned about the fact that only one of the world's 10 biggest banks is American.

"I don't think that makes much difference," he said. "It's how well-managed and profitable they are 1 am more concerned with' the profit-and-loss statement." None of the other committee members took up Mr. Proxmire's line of questioning about the golden parachute, which was negotiated earlier this year as part of the merger that created Shawmut National. Mr. LaWare must pay income tax on the full amount of the golden parachute payment, including whatever amount the bank chips in to cover the special excise tax.

South, West lead in on-time flight arrivals WASHINGTON (AP) Four out of every five flights into the nation's 27 busiest airports arrived on time in May, and cities in the West and South chalked up the best records, the Transportation Department said yesterday. The month report by the nation's 13 biggest airlines showed that 80.5 percent of their flights into the largest airports landed within 15 minutes of their scheduled arrival times. Flights destined for Salt Lake City landed on time 91.9 percent of the time, the best percentage reported-Minneapolis, with an 86.5 percent on-time rate, rated seventh best and was the highest-ranked city not in the South or West. By contrast, the airports with the seven lowest arrival rates were all In the Northeast: Pittsburgh, Philadelphia, Boston, Newark, N.J., both New York City airports and Washington National. The department does not count flights that were late for mechanical reasons.

The statistics also showed that the airlines with the highest on-time performances in May fly primarily in nil. vv UOL aiiu uuuiu. uuuliivyioi nau an on-time rate of 92.5 percent, and America West's flights arrived as scheduled 90.9 percent of the time. Pan American had the highest percentage of individual flights that were late at least 70 percent of the time, 6.3 percent. USAir had the sec- I C5 ly late flights, 2.5 percent.

TWA, with 9.54 for every 1,000 passengers, had the most complaints about lost and damaged baggage in May. Southwest Airlines reported the lowest rate, 3.23 for every 000 passengers. Overall, the airlines reported receiving 6.16 complaints for every 1 ,000 passengers about mishandled baggage, down from the average of 6.53 in April. Overall, the Transportation Department received 1 ,707 complaints from passengers about service last month, a 70 percent decline from the 5,774 reported in June 1987. Two carriers owned by Texas Air Corp.

had the highest rates of complaint. Continental Airlines reported II. 11 complaints for every 100,000 passengers last month. Eastern Airlines said it got 9.16 complaints for every 1 00,000 customers. possible sites for a new headquarters.

McCormick spokesman Mac Barrett said that he did not know whether HighPointe was even under consideration as a site for McCor-mick's new headquarters. "To the best of my knowledge." he said, "we still have not finalized the site." At present, no tenants have been identified for HighPointe. Mr. Lichtenauer said. The construction timetable for the later phases will depend on the pace of leasing at the first building, he added.

Current Prices On Nearly 9,000 Stocks Updated Every 30 Minutes. Free call 24 hours a day, 7 days a week. Look fur a directory of categories on page 2. SUNDIAL In Anne Arundel Couniv. call 2b8-773B.

1288 Oil prices surge but then Deutsche Presse Agentur TOKYO Japanese Prime Minister Noboru Takeshita acknowledged yesterday that one of his former secretaries was involved in a stock-trading scandal. Answering reporters' questions, Mr. Takeshita said Ihei Aokl had earned profits two years ago by selling shares in a real estate firm after obtaining them before they were put on the open market. But the prime minister declined to say how many shares of Recruit Cosmos Co. his secretary sold or how much profit he gained from the deal made two years ago, press reports said.

The Japanese media also report The top American billionaire on the list is Sam Walton, who ranks seventh. Barbara Cox Anthony and Anne Cox Chambers ($3.6 billion), John Kluge ($3 billion) and H. Ross Perot ($3 billion). Not all the fortunes on Forbes' list were amassed in a respectable way. Three of them belong to people the magazine identified as Colombian drug dealers, two individuals and one family who are all part of the notorious Medellin cocaine cartel.

Two of the Colombian cocaine fortunes, those of Pablo Escobar Gavlria and the Ochoa family, are worth more than $2 billion each, Forbes said. It estimated the third, amassed by Gonzalo Rodriguez Gacha, at $1 .3 billion to $3 billion. ed that the secretaries of other political leaders were involved in the stock-trading scandal, including aides to former Prime Minister Yasu-hiro Nakasone, Finance Minister Kii-chi Miyazawa and Shintaro Abe, secretary-general of the ruling Liberal Democratic Party. The Recruit Cosmos shares were provided to the secretaries by Hiro-masa Ezoe, who resigned Wednesday as chairman of Cosmo which is the parent company of Recruit Cosmos. Mr.

Takeshita told reporters that the scandal would adversely affect his government's efforts to launch a sweeping tax reform, including the introduction of a 3 percent consumer tax. Columbia, at Appliance Park-East. The Rockville, branch of GE Information Services has 800 employees. GE's stock closed yesterday on the New York Stock Exchange at $44. 125 a share, up 87V2 cents.

The company originally reported second-quarter 1987 earnings at $720 million but restated the earnings to reflect the adoption of new tax-accounting rules. On the basis of the change, this year's second-quarter earnings are up 23 percent compared to the same period a year ago, but GE said a comparison with the original figures was more meaningful because earnings of its operating businesses were not affected by the accounting change. GE said earnings for the first half of the year rose 16 percent, to $1.56 billion, compared to the first six months of 1987. Sales of $1 7.22 billion were off 4 percent but were up 3 percent when adjusted for acquisitions and dispositions. Revenues in the second quarter fell 3 percent, to $9.25 billion.

GE's largest union, the International Union of Electronic Workers, overwhelmingly ratified a tentative contract agreement late Wednesday. NEW YORK (AP) Oil prices surged upward in erratic trading yesterday but settled off their peaks as traders assessed both the impact of a rig explosion in the North Sea and the chances for an emergency OPEC meeting. On the New York Mercantile Exchange, the contract for August delivery of West Texas Intermediate crude oil settled 47 cents higher at $15.83 a barrel. The contract traded as high as $16.35 per 42-gallon barrel during the session. Among refined products traded on the exchange, unleaded gasoline closed up 2.56 cents a gallon at 53.12 cents after being up nearly 4 cents earlier in the day.

Home heating oil advanced 1 .68 cents a gallon to 44.29 cents. The news of an oil rig explosion off the coast of Scotland "was the GE's 2nd-quarter earnings increase 16, to $835 million New York Dayton-Hudson, 1 .05 Minneapolis Wal-Mart, 1.62 Bentonville, Ark. Woolworth, New York .406 May, St. Louis 1.10 Montgomery Ward, .434 Chicago sephthal and to the company's strategy of expanding its specialty operations. "Before acquisition of several specialty retailing operations, sales were lackluster and below corporate targets but, with the new businesses, sales are exceeding corporate targets," she said.

The 9.8 percent sales rise Includes contributions from recently acquired Western Auto Supply, Pinstripe Petites and Eye Care Centers of America. mart Corp. reported a 7 percent increase In June, reflecting a "better tone to its apparel business which was strong throughout the month in both the ladies' and men's areas," The oil rig explosion will affect 12 percent of North Sea production. beginning reason for hysteria," said John O'Connell, senior energy analyst at Refco Inc. He said traders were quick to react to the fact that the explosion would affect about 12 percent of total North Sea production, or as much as 300,000 barrels of oil a day.

"That sounds very, very impressive, but it's really Insignificant it's a very small amount of world production," Mr. O'Connell said. about 15 percent of the growing regions will receive more than a half-inch of rain and that the drought will intensify in most areas. Analysts said selling in the soybean market accelerated late in the session when Sen. Robert J.

Dole, speaking to the Commodity Club of Washington, said the Agriculture Department might let farmers plant oats and soybeans on acres they otherwise had pledged to leave idle under government programs. Such an allowance couldn't take effect until next year, but it unnerved the skittish market even more, analysts said, and added enough fuel to push futures prices down the limit. for Alleco to any other bids for Alleco. Last week, Alleco said it had received feelers from two potential buyers. Both proposals mentioned bids higher than $9 per share.

Alleco spokesman Frank Silves-tro would not say whether those feelers had led to detailed offers. The company has not identified the potential buyers. If Alleco's board accepts the Lapides Corp. proposal, a tender offer must be started within a week. The tender offer must be kept open for about a month.

McCormick Properties moves Hunt Valley complex along Corn, soybean futures plunge despite Midwest heat wave FAIRFIELD, Conn. (Reuters) General Electric Co. said yesterday that higher profits at its plastics, broadcasting and financial-services units boosted its second-quarter earnings by 16 percent, to $835 million. "The operating margin rate of 10.5 percent for the second quarter of 1988, up from 1988's first-quarter 10.2 percent and 1987's second-quarter 9.7 percent, reflects better cost structures in virtually all businesses," Chairman John Welch said in a statement. The company said earnings at its broadcasting operations were well ahead of those a year ago as the profitability of its NBC television operations Increased.

GE also said that a particularly good performance by its Employers Reinsurance Corp. helped earnings at the financial-services unit. Revenues from major appliances were higher as a result of the acquisition of Roper Corp. during the quarter, but operating profits fell, reflecting competitive pressure on prices, higher costs for materials and the cost of developing new products. GE has about 1 .000 employees in Directors to ALLECO, from IE in total assets.

$190 million in long-term debt and $93 million in stockholders' equity. The report also lists several potential problems that could cost Alleco millions. The Internal Revenue Service, for example, is questioning tax returns that Alleco has filed in recent years. The Securities and Exchange Commission is investigating possible violations' of securities laws during Alleco's 1 986 and 1 987 fiscal vears. MCCORMICK, from IE "CenterPointe was a huge success," Mr.

Lichtenauer said. "We're at a premium up here, and we need more space to satisfy our business needs." Davis and Carter of Tyson's Corner, is the architect for the first two buildings of HighPointe Center, whose location at one of highest points in the Hunt Valley area will give office workers panoramic views of the rolling farm land nearby. McCormick Construction Co. will be the builder, and McCormick Properties will handle leasing. Officials disclosed earlier this year that McCormick and which currently leases space for its headquarters at a Hunt Valley office complex near the HighPointe Center construction site, was considering TOWS ON Prime office space 1500-3000 Sq.

Ft. Available immediately FREE utilities Bargain Rates Brokers Welcome Call (703) 893-0250 FUTURES, from IE because prices already have risen considerably, Mr. Feltes said. "We're a dollar a bushel over where we were a month ago. And the government has a sizable quantity of corn they are committed to dole out to minimize the damage to the livestock producer, which is the end result of 60 percent of U.S.

corn usage," Mr. Feltes said. The weekend weather forecast for the Midwest also was a factor, analysts said. AccuWeather a private weather service in State College, predicted some rain in the Midwest. However, the forecast said that only board of directors and to veto any merger.

The special directors' committee previously had endorsed Lapides S9-per-share offer. Despite that endorsement, negotiations for a definitive agreement led to the SI 0 bid, said Jeffrey R. Lapides, vice president of Lapides Corp. lie is Lapides' son and Alleco's executive vice president. Neither Alleco nor Lapides Corp.

would 'comment on those negotiations. But Jeffrey Lapides said the sweetened offer was not a response consider sweetened bid Meanwhile, Lapides faces a prison term for a federal price-fixing conviction. In May, he and Allegheny Beverage were found guilty of conspiring to set soda prices In the mid-Atlantic region during the mid-1980s. Sentencing Is scheduled for late August. Lapides owned by Lapides and other family members, wants to buy the Alleco common stock that it and Lapides do not already hold.

Lapides CoJp. also holds all Alleco's Series A preferred stock, which carries the right to appoint a majority of the.