Quicksilver, Billabong and Volcom stores closing after bankruptcy filing
A rise in interest rates, persistent inflation, supply chain delays, a decline in consumer demand, a shift in consumer preferences, and substantial fixed costs were all listed as challenges the company has faced.
As part of court filing documents, Liberated CEO Todd Hymel submitted a 29-page statement detailing "a series of major headwinds and challenges."
The company listed debt of $226 million, with approximately 1,400 employees laid off.
"The Company has been further challenged by trends impacting the retail environment more broadly, including shifting consumer preferences for "fast fashion" and e-commerce as opposed to branded apparel and brick-and-mortar retail," Hymel wrote.
He went on to say that while profits rose during the COVID-19 pandemic as customer demand for outdoor apparel and online shopping spiked, shopping in-person at the stores never fully bounced back.
The brands, rooted in the surf, snow, and skate culture, will continue to produce clothing despite the more than 120 storefront closures.
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NBC News
an hour ago
- NBC News
Chicago Fed President Goolsbee thinks central bank should wait a few months before cutting interest rates
What does a donut tell us about the state of the economy? Chicago Federal Reserve President Austan Goolsbee thought about that Wednesday as he toured Mel-O-Cream Donuts in Springfield, Illinois. Even inside a donut shop, the effects of tariffs on the economy can be seen. 'It's sort of surprising, because donuts seem like a very local product, and yet they get some ingredients like palm oil that are coming from Indonesia,' Goolsbee said. The Trump administration set tariffs on Indonesia at 19%. 'They have to now figure out what are the tariff rates, and the tariffs went up a significant amount. If that happens, that could have a multi-thousand-dollar impact on their operation,' he continued. But, he added, 'I hope it's not a sign of something more extended or broader in the way that the Covid inflation ... generated its own snowballing, in which it was supposed to go away and it didn't go away.' That tariff will cost Chris Larson, a co-owner of Mel-O-Cream, 'about $4,000 per shipment per week,' he said. And that used to be somewhere 'closer to $2,000 to $2,100 weekly. Now it's going to move up to $4,200 ... for the exact same product.' Goolsbee's visit matters because he's one of just 12 people in the country who get to decide what to do with interest rates. The Fed's rate-setting committee will next decide whether to cut or hold on Sept. 17, and the perspectives of businesses like Mel-O-Cream are instrumental in helping him determine his next vote. Larson's hope? That the Fed will cut interest rates, which would help Mel-O-Cream finance new equipment to cut costs in labor and blunt the impact of tariffs. 'What is the cost of money in order to expand, to upgrade, to update? What do those things look like?' Larson said. 'Those things do concern us, and we would love to see, as everyone would, the interest rates would come down.' Goolsbee said he wasn't yet ready to tie his hands to an interest rate cut in September. 'Let's get a few months of data before we make any conclusions. The hardest thing that the Fed ever has to do is get the timing right at moments of transition,' he said Wednesday on NBC News' 'Here's the Scoop' podcast. 'I think as we go through this fall, September, November, December, all of those are live moments that we could be cutting rates.' Government data Thursday showed that wholesale prices paid by U.S. companies rose much more than expected. Another measure, the consumer price index, showed Tuesday that inflation remained stubbornly high in July. The Fed's target for inflation is 2%, lower than the most recent consumer inflation reading of 2.7% and producer inflation reading of 3.3%. Even with those numbers, the market still anticipates a cut next month. President Donald Trump's sweeping tariffs on hundreds of trading partners around the world could affect the cost of most of the imports that businesses buy from overseas. With a myriad of rates as high as 50%, businesses may be faced with a new maze of rates and tariff bills, as well as the uncertainty that comes with the on-again, off-again tariff rollout. 'The Fed, by law, is supposed to maximize employment and stabilize prices. So it's inflation and employment that are really the twin towers of how we think about setting of rates,' Goolsbee said, underscoring the Federal Reserve's role in the broader economy. 'There are parts of the job market where there's still basically labor shortages. It's very hard for people to find workers. And that's what you kind of saw here at the donut factory,' he said. Goolsbee oversees the Seventh Federal Reserve District, which includes Iowa, much of Illinois, Indiana, Michigan and Wisconsin. Some of his colleagues, including Jeffrey Schmid, of the Kansas City Fed; Alberto Musalem, of the St. Louis Fed; and Beth Hammack, of the Cleveland Fed, are sounding similarly cautious tones about the economy. All three current Federal Open Market Committee voters have said in recent days that it's either too early to decide or that keeping rates steady for now would be their preference. The futures market predicts the Fed will cut by 0.25% at its next meeting. But some, including Treasury Secretary Scott Bessent, think the Fed should make a more dramatic cut, by up to a half-point. Musalem said Wednesday on CNBC that a cut that large would be 'unsupported by the current state of the economy.' Amid unrelenting attacks from Trump and his administration against the FOMC and Chair Jerome Powell, Goolsbee, who was an economic adviser to President Barack Obama, said economic indicators should drive monetary policymaking, not politics. 'The FOMC and my own thinking are that what should drive interest rate decisions should be the economic conditions and the economic outlook,' he said. 'I invite anybody to look at the minutes or read the transcripts of the FOMC — the people on that body take extremely seriously that it is the economy that should drive the decisions. And that is what drives the decisions.' 'This is a committee made up of people from a lot of different perspectives. And as I say, they keep track of, word for word, what everyone says at the meetings. And you can look at it yourself.'
Chicago Tribune
3 hours ago
- Chicago Tribune
Aurora City Council pushes back on possible reductions in support for Paramount
The city of Aurora is looking at pulling back on discussed financial support for the Aurora Civic Center Authority, which owns and operates the Paramount Theatre, but some City Council members are saying they're concerned about the possibility. The matter came up at Tuesday's Aurora City Council meeting, when the council heard a presentation on the city's 2024 audit and discussed the city's future financial concerns. The presentation described the city's use of American Rescue Plan Act, or ARPA, funds during the COVID-19 pandemic, money which had to be obligated by 2024 and spent by 2025, Aurora Chief Financial Officer Stacy Peterson told the council. Much of that funding was spent on ongoing costs, she said, like the ShotSpotter system, body cameras and dash cameras for the police, the addition of 49 full-time employees and financial support to things like the Aurora Civic Center Authority. Peterson also noted that costs for the city went up in 2024, as did the city's debt, and revenue stayed the same or went down slightly. Aurora is facing a significant budget gap for the coming year, Mayor John Laesch recently said. In addition to other attempts to cut costs or generate more revenue, one recent move was the cancellation of the proposed City of Lights Center theater and event space that would have been managed by the Aurora Civic Center Authority, according to past reporting. The project didn't make sense to him or others, and the price was just too high, Laesch has said. Laesch also recently said that the city has been giving the Aurora Civic Center Authority 'way too much,' according to past reporting. In addition to the Paramount, the Aurora Civic Center Authority owns and operates the Copley Theatre, Paramount School of the Arts and North Island Center, as well as manages the city-owned RiverEdge Park and Stolp Island Theatre. Earlier this month, ACCA said in a letter to subscribers that the city's previously-communicated financial support of the organization could be reduced by up to 65%, a change made after programming and budgeting had already been committed for 2026, according to past reporting. The organization said its Bold Series would be going on hiatus after the final performance of its current production, 'True West,' on Aug. 31 at the Copley Theatre in downtown Aurora. ACCA also reduced its full-time staff by around 20%, President and CEO Tim Rater previously said. ACCA was facing a $7 million shortfall in its 2026 budget, and under former Mayor Richard Irvin, the city was considering filling that gap, according to past reporting. That planned support represented roughly 20% of the organization's overall yearly budget, according to Rater. In a statement, Laesch reiterated that the ARPA funding that had previously been supporting the Aurora Civic Center Authority was no longer available, and he said that the city has offered to help with fundraising, cross-promotion and other initiatives to help the organization's finances. A spokesperson for the Paramount on Thursday said that it is continuing to negotiate with the city, but declined to comment further on the organization's plans going forward. At Tuesday's City Council meeting, council members noted that there had been pushback from constituents about the possibility of the city reducing financial support for the Paramount. Ald. Jonathan Nunez, 4th Ward, said that 'upset is an understatement' in terms of the response he's gotten from constituents. 'Our budgeting and our revenue and expense proposals are basically a reflection of our community's values,' Ald. Carl Franco, 5th Ward, said at Tuesday's meeting. 'I think we all know how the community feels about the value down there … it seemed like that was a harsh way to start.' Laesch said at the council meeting that the city has never had a budget line for ACCA, and that Aurora is facing significant financial challenges. The city will provide an update to the council on its financial situation on Aug. 26, per the presentation from Tuesday's meeting. 'I think when you get the Aug. 26 financial update, I think you'll probably realize just how serious of a financial situation the city's in,' Laesch said. 'I'd say that it (is) probably going to be pain felt all over.' But City Council members expressed concern that possible cuts to the Paramount would have an impact beyond the theater itself, to surrounding businesses and restaurants, for example. 'The engine, as we know, is the arts down here, and I hope it doesn't affect them,' Franco said. 'I hope … that it doesn't see them leaving, because that's revenue for us.' Ald. Patty Smith, 8th Ward, said it might mean less people coming to Aurora overall. 'The cuts are going to come back at us,' Smith said. 'The people that come to Aurora because of our Paramount will no longer be coming here because we're not going to be offering the quality and the shows and the amount of shows that we have had in the past.' Ald. Edward Bugg, 9th Ward, said there was a 'gap here … in terminology,' noting that city funds for ACCA hadn't been budgeted yet, but were merely projections for next year. Ald. Will White, at-large, said he believes the city should support the arts, but asked if there is any oversight from the city as to how money is spent when they give it. Laesch said he thinks the city can look at its finances, and said that the city will need to have some oversight on the accounting at ACCA. As the city continues to grapple with its financial troubles, the council on Tuesday suggested some direction for how it wants the city to proceed in supporting the Paramount. Ald. Michael Saville, 6th Ward, for example, advocated for 'more of a soft landing to assist them, rather than something so drastic.' 'I think everybody recognizes that (funding) needs to be cut,' Saville said. 'The question is: can we do it in such a way where it doesn't hurt their programming and doesn't hurt the businesses and doesn't hurt the economic activity that we've established here?'
Miami Herald
3 hours ago
- Miami Herald
Miami man who swindled millions from Venezuelan-American investors sentenced to 7 years
Dozens of Venezuelan-Americans who were swindled by a local businessman after investing tens of millions of dollars in his payday loan company poured into Miami federal court on Thursday. One of them, David Villanueva, said he entrusted his life savings to Efrain Bentcourt Jr., the head of Sky Group USA, which used investors' funds to finance high-interest loans. 'We went to therapy,' Villanueva told U.S. District Judge Darrin Gayles, explaining that he lost 'the majority' of his $1.3 million investment in Sky Group. 'My whole family was affected by this. We considered going back to Venezuela because we found ourselves without any money.' Gayles punished Betancourt with a seven-year prison sentence — nine months more than a federal prosecutor recommended, following the former Sky Group CEO's guilty plea to a wire fraud conspiracy in an agreement struck in May. As part of that deal, Betancourt, a dual U.S. and Colombian citizen who was born in Venezuela and grew up in South Florida, must pay $8.3 million in a forfeiture judgment for the money that he pocketed from investors and used for personal expenses, including buying a Biscayne Boulevard luxury condo and financing his wedding at a chateau in the French Riviera.. Betancourt, 36, also will likely be ordered by the judge to pay back at least $23 million to hundreds of victims for their losses. In total, Betancourt attracted about 600 Venezuelans in South Florida to invest $66 million over five years into his business, which used the funds from new investors to pay off old ones before his scheme collapsed during the COVID-19 pandemic in 2020. Assistant U.S. Attorney Roger Cruz called Betancourt a 'recidivist fraudster' who lied to investors, while defense attorney Sam Rabin argued that his client started his payday loan business with 'good intentions' before it turned into an investment scheme. 'To say that he's a serial fraudster is, frankly, unfair,' said Rabin, who urged the judge to give Betancourt a sentence of less than six years, to no avail. He suggested that about 40 investment victims coordinated a 'letter-writing campaign' to the court that seemed suspicious because of their similiar content — an accusation that Cruz strongly denied. Betancourt, who has not repaid any of his victims, appeared remorseful as he stood up in court to address the judge, saying he was ashamed of himself for hurting so many people. He pledged to pay them back. 'You deserve an apology,' said Betancourt, who drew support from his parents, a pastor and dozens of friends who attended his sentencing. 'I can only say that I didn't wake up in the morning and decide to break the law.' According to court records, Betancourt's company made about $12.2 million in consumer loans — far less than the $66 million Sky Group attracted from investors. Betancourt and other employees spent the rest of the investors' money on operating costs, sales agent commissions and personal expenses, according to a factual statement filed with his plea agreement. Betancourt has been in federal custody since his arrest last November by FBI agents at Miami International Airport, after Cruz argued he was a flight risk to Latin America or the United Arab Emirates. Three years ago, Betancourt and his company reached a settlement with the Securities and Exchange Commission in a parallel civil case. SEC lawyers accused him of using his payday loan business to fleece investors, and a federal judge ordered him and his company to pay back more than $39 million. But since the SEC settlement agreement, Bentacourt's investors have received nothing for their losses, according to authorities. Both the SEC and federal prosecutors accused Betancourt of operating a 'Ponzi scheme' that began in 2016 by selling promissory notes to investors with promises of double- and triple-digit annual returns. Some investors were paid back in part, but most were not, leaving a huge debt after Sky Group imploded during the COVID-19 pandemic in 2020. Betancourt's scheme collapsed when countless borrowers defaulted on their payday loans during the pandemic. His company, Sky Group, incurred a severe cash-flow problem and was unable to make interest payments on investors' promissory notes. A Miami lawyer representing three investors who won civil arbitration cases against Betancourt said he brought the investment scheme to the SEC's attention years ago. 'These were people who had given all or part of their life savings to Mr. Betancourt,' attorney Richard Diaz told Judge Gayles during Thursday's sentencing hearing. After Betancourt lost at arbitration, he refused to apologize to the victims. 'I took a professional offense to that,' Diaz told Betancourt's defense attorney, Rabin, during the sentencing hearing. According to the SEC and federal court records, Betancourt misappropriated investors' money for his personal use, including buying a $1.5 million condominium at Epic Residences on Biscayne Boulevard and servicing his personal Piper airplane. Betancourt was also accused of transferring at least another $3.6 million to friends and family, including his ex-wife, Angelica Betancourt, and to another company, EEB Capital Group LLC, for 'no apparent legitimate business purpose,' SEC officials said. That company's bank accounts were controlled by Efrain Betancourt and his current wife, Leidy Badillo. In a SEC settlement in 2022, EEB Capital agreed to pay $2.2 million toward the judgment against Sky Group and Efrain Betancourt. Angelica Betancourt argued that she only earned an annual salary of $60,000 from the payday loan company, according to court records. But in 2022, she also agreed to pay about $1.1 million toward the judgment against Sky Group and her ex-husband.
