FARUKI

HBOS has announced plans for a rights issue to raise £4bn of extra funding from its existing shareholders.

The bank, which has more than 2 million shareholders, said it was planning for “a more challenging environment ahead”.

HBOS added it was writing off £2.8bn from the value of its investments linked to the US sub-prime mortgage market and the global credit crunch.

Last week, Royal Bank of Scotland announced it was planning to raise £12bn through a rights issue. Read more »

Richard Lambert, director general at the CBI, said: “This cut was badly needed, and will be welcomed by a business world that is feeling the pressures of the credit crunch and of slower growth. Higher interbank and mortgage lending rates are dampening investment, consumer demand and economic activity, and today’s cut should ease conditions a little. Read more »

Two of Britain’s biggest mortgage lenders today defied the Bank of England by raising interest rates just hours before the official cut.

Nationwide building society and Alliance & Leicester put up borrowing costs as the monetary policy committee voted to reduce the base rate from 5.25% to 5%.

It underlined the crisis facing lenders in raising funds as the credit crunch leaves borrowing costs between banks well above official rates. Read more »

A father and daughter have been accused of tricking 15,000 mostly elderly British citizens out of more than $70m (£34m) by selling worthless shares. Investigators allege Paul Gunter, 58, and daughter Zibiah, 25, from Florida, sold fake shares in 50 dormant firms.

The pair have been charged with money laundering, mail fraud and securities fraud, US officials said.

If found guilty, they could face up to 25 years in prison and a fine. They are due to appear in a Florida court later.

The BBC’s Andy Gallacher, in Miami, says it is thought the Gunters hijacked the identities of the dormant, publicly traded companies and used high-pressure sales techniques to sell worthless shares to British investors.

They are believed to have started the alleged scam in early 2005, US investigators said.

Deputy chief inspector Robert Wishart, head of the money laundering unit at City of London Police, said the arrests were part of an ongoing investigation into a “mass-marketing crime scam known as boiler room fraud”. Read more »

CIGARETTES AND ALCOHOL

• Cigarettes up 11p a packet of 20 from 1800 GMT; five cigars up 4p.

• Beer up by 4p a pint, wine 14p a bottle, spirits 55p a bottle and cider 3p a litre by Sunday.

• Duties on alcohol will go up by 2% above inflation in each of the next four years.

Read more »