SC business notebook, June 6

June 5, 2014 

General Motors Investigation

FILE - This Friday, May 16 2014 file photo shows the General Motors logo at the company's world headquarters in Detroit. General Motors plans to release the results of an outside attorney's investigation into its mishandled recall of small cars on Thursday morning, June 5, 2014.

PAUL SANCYA — AP

Companies bringing jobs to S.C.

Several companies announced this week they are creating jobs in South Carolina. California-based Ruiz Food Products, a Mexican food and snack products maker will invest $55 million and create 500 jobs in Florence County as it sets up an East Coast distribution hub over the next few years. SoPakCo, a Tennessee-based company that makes ready-to-serve foods will invest $3.4 million and create 120 jobs in Marion County this fall. And KI Logistics, a division of Kimura Inc. and a subsidiary of global logistics company Kimura Unity, will expand its 208,000-square-foot new North American headquarters and logistics facility in Greenville by an additional 64,000 square feet. The $2.7 million expansion will create 20 additional jobs.

Government sues former Atlantic Bank officers

The U.S. government lost a bundle after it seized Atlantic Bank & Trust three years ago. This week, it sued some of the Charleston-based lender’s former decision-makers in an effort to collect part of the bill. The Federal Deposit Insurance Corp. is seeking to recover more than $9.2 million in damages that it said it has absorbed after it took ownership of the failed bank in June 2011.

The agency filed a lawsuit Monday in U.S. District Court naming seven former directors, including two executive officers, for negligence and breach of fiduciary duty. The FDIC alleges the ex-board members and executives are personally liable for approving nearly two dozen real estate loans without properly vetting the borrowers. It is seeking a jury trial.

The former executives named in the complaint are Hal E. Cobb, the founding president and CEO, and Mark J. Barone, the chief credit officer at the time. They left Atlantic Bank in 2008 and 2010, respectively. The other defendants are all Charleston-area residents who were on the bank’s board and loan committees during the 11-month period: John T. Chakeris, Brent A. Case, Charles T. Cole, Margaret L. Hines and Darrell L. Owenby.

Attorney Thomas Tisdale, who represents Cobb, said he had no comment Tuesday. Mary Gill, who represents Barone and the five outside board members, issued a written statement Monday, saying they “faithfully fulfilled their responsibilities and at all times acted in the best interest of the bank” and the FDIC’s claims are without merit.

Sam’s Club to offer credit card microchips

Sam’s Club on Wednesday said it will become the first mass retailer in the U.S. to offer a credit card using a fraud-deterring microchip. The warehouse club, owned by Wal-Mart Stores Inc., said the card will be co-branded with MasterCard and will be available this month.

Visa and MasterCard are pushing for the adoption of credit cards that use microchips rather than the black magnetic strips found on most cards. The card processors say microchips have helped reduce fraud elsewhere, including in Canada, Mexico and most of Western Europe.

The chip technology hasn’t been widely adopted in the U.S. because of costs and disputes over how the network would operate. But the disputes have now largely been resolved. Several recent data breaches at retailers – including a massive one of Target’s computer systems last year – helped garner support among retailers for cards using microchips.

Results of recall probe to go public

General Motors plans to release the results of an outside attorney’s investigation into its mishandled recall of small cars on Thursday morning at its technical center in the Detroit suburb of Warren.

CEO Mary Barra will lead a worldwide employee meeting to discuss the report and hold a news conference afterward. In the afternoon, the company will update industry analysts in a conference call hosted by Barra.

GM has hired former U.S. Attorney Anton Valukas to investigate why it took the company more than 10 years to recall about 2.6 million small cars with faulty ignition switches. The company says the problem has caused at least 13 deaths, but trial lawyers suing GM say the toll is at least 60. The (Charleston) Post and Courier and The Associated Press contributed.

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