Business Briefly August 25, 2011

Google settles pharmacy ad probe

PROVIDENCE, R.I. - Google Inc. has agreed to pay $500 million to settle a U.S. government investigation into the Internet search leader's distribution of online ads from Canadian pharmacies illegally selling prescription drugs to American consumers.

The settlement means Google will not face criminal prosecution for accusations that it improperly profited from ads promoting Canadian pharmacies that illegally imported drugs into the United States, Rhode Island U.S. Attorney Peter F. Neronha said. It is the first time an Internet search engine is being held responsible for the illegal distribution of drugs.

"It sends a clear message to both Google and to others that contribute to America's pill problem that they will be held to account for endangering the health and safety of the residents of this district and to persons all across the United States," said Neronha, who described the forfeiture as one of the largest in U.S. history.

The $500 million figure represents the gross revenues Google collected in ad buys from hundreds of Canadian pharmacies, plus the earnings generated from the illegal drug sales to American consumers from 2003 to 2009, federal investigators said.

Gold's roller-coaster ride continues

NEW YORK - After months of setting record after record, the price of gold plunged $104, or 5.6 percent, Wednesday to finish at $1,757 per ounce. That was the biggest percentage drop in nearly 3? years and a blow to investors who thought the metal could go only one way - up.

"Gold was considered a safe haven for years because it wasn't popular, but now it's popular," said Cetin Ciner, a professor of finance at the University of North Carolina-Wilmington. "You can't have a fad and a safe haven at the same time."

The drop Wednesday came on news that orders for long-lasting manufactured goods rose 4 percent in July, which was more than analysts had expected. Investors may also have been selling on news of new rules in China requiring traders to set aside more collateral when borrowing money to buy gold. After gold settled in the U.S. Wednesday, exchange operator CME Group announced it was raising its collateral requirements, too.

Considered a safe investment in times of turmoil, gold has become a favorite among investors worried about rising U.S. debt, the possibility of inflation and a spreading debt crisis in Europe. But many investors have simply been looking to profit from gold's ever-rising price.

In October 2007, gold traded for about $740 an ounce. Two months later, the Great Recession started and gold began creeping up. This summer, the rise accelerated. Gold started July at $1,482.60 an ounce and on Monday hit a record $1,891.90 - a gain of 28 percent in less than two months.

Burger King on oatmeal bandwagon

PORTLAND, Ore. - Burger King, the world's second-largest hamburger chain, added oatmeal to its breakfast menu this week, joining a slew of other chains that have brought the hot cereal out of the cupboard and into restaurants and drive-throughs.

Burger King says it is trying to offer customers a healthier breakfast option beyond its sausage croissant sandwiches and French toast dipping sticks. It's also an attempt by the struggling chain to catch up to competitors and boost sagging sales by appealing to customers beyond its base of burger-and-fries fans.

Breakfast is becoming the most important meal of the day for restaurants - accounting for nearly 60 percent of traffic growth between 2005 and 2010. And oatmeal is the latest battleground. It's low-cost, easily prepared and doesn't spoil quickly. It also appeals to people who want quick, affordable food they perceive as healthier than the typical fast-food breakfast fare.

Starbucks Corp., the world's biggest coffee chain, said its $2.49 oatmeal has become its most popular breakfast item since it launched in 2008. Last year, McDonald's Corp., the world's largest burger chain, added $2.99 oatmeal to its menu. Fast food chain Chick-fil-A and Denny's casual dining restaurants also offer oatmeal, for $2.49 to 2.85 and 3.49 to 4.49, respectively. Burger King's oatmeal, at $1.99, is the cheapest of the group.

- The Associated Press