Thursday September 26, 2002

Accounting stripped of license it voluntarily gave up 

SACRAMENTO — A California board has stripped accounting giant Arthur Andersen of its license to operate in the state, officials said Wednesday. 

The state Board of Accountancy took the action after Andersen waived its right to a hearing before an administrative law judge. 

A federal court jury in Texas found the company guilty of obstruction of justice in June for its role in the Enron scandal. Government attorneys contended Andersen shredded documents relating to Enron Corp. to hide financial irregularities by the now-bankrupt energy trader. 

The action by the California board follows a decision by officials in Texas to pull Andersen’s license there. 

Silicon Valley HMO closing 

SAN JOSE — Health care may be on the shopping lists of thousands of Silicon Valley employees during this year’s holiday season. 

Lifeguard, Inc., a Milpitas-based HMO, will cease operations Dec. 31, forcing nearly 165,000 patients to scurry for new medical coverage and leaving scores of doctors wondering whether they’ll be paid for services already provided. 

The California Department of Managed Health Care seized the company Sept. 13 and has since said it would become the fourth HMO state officials have closed since the department was established in 2000. 

For nearly 25 years, Lifeguard has covered employees both public and private — from the City of San Jose and the Livermore School District to high tech giant Hewlett-Packard and defense contractor General Dynamics. 

HP to cut 1,800 more jobs 

SAN JOSE — Citing continued weak demand, Hewlett-Packard Co. said Wednesday it will cut 1,800 jobs beyond the 15,000 reductions planned as part of its Compaq Computer Corp. acquisition. 

The cuts are expected to be completed by the end of fiscal 2003. As of the third quarter, which ended July 31, the company had reduced its net headcount by 4,740. 

In a note sent to employees Tuesday, the company blamed the latest reductions on a “continued market slowdown and HP’s clear intent to have a competitive, world-class cost structure.” 

HP expects to have reduced its work force by 10,000 by Oct. 31, the end of its current fiscal year. 

Davis signs bill for  

Armenian trade office  

SACRAMENTO — Gov. Gray Davis signed legislation Wednesday creating California’s 13th overseas trade office — if the cash-strapped state can raise private donations to pay for it. 

The bill by Sen. Jack Scott, D-Altadena, directs the Technology, Trade and Commerce Agency to set up the office in the Republic of Armenia if it can raise money from an outside source to cover the cost. 

The head of the agency, Lon Hatamiya, and Scott said state officials hope to raise the money with help from California’s Armenian community.