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(Reuters) – A potential strike at South African power firm Eskom widened after a second union said on Wednesday its members rejected a new pay offer and would join a work stoppage that could disrupt power during the World Cup.

The National Union of Metalworkers of South Africa (Numsa) said its members had rejected state-owned Eskom’s latest offer and would join the National Union of Mineworkers (NUM), the biggest of Eskom’s unions, in next week’s strike. “Members have rejected the offer, and there will be mass action next week. We are going to strike together with the other union,” Castro Ngobese, Numsa’s spokesman, told Reuters.

A third union at Eskom, Solidarity, said its members had rejected the improved offer, but wanted the utility to revise its offer by Monday and it would then make a decision on whether it would join any strike.

Any power disruption could harm manufacturing and mining companies in the world’s top platinum and fourth-largest gold producer and force them to curtail operations, potentially pushing up precious metals prices.

Analysts have regarded the strike threat as a union negotiating ploy to put pressure on Eskom to make greater wage and benefit concessions. They do not see any labor action leading to a cut-off of power that hurts the economy or the soccer World Cup hosted by South Africa, which ends on July 11.

“The unions are prepared to fight it out. I do think that management will fold. Management will be under enormous pressure from the government and elsewhere,” said Nic Borain, an independent political analyst.

The NUM’s spokesman, Lesiba Seshoka, said the union was likely to issue Eskom with notice of its planned strike this week. Sources close to the talks said informal negotiations were still underway.

“The notice to strike will possibly be issued this week, possibly today or tomorrow, but the strike itself will be next week,” Seshoka told Reuters.

Seshoka said Eskom had offered an 8.5 percent pay rise and 1,000 rand per month housing allowance, which was turned down by the NUM’s members, who number about half of the 32,000 workers at the utility. Numsa represents about 7,500 Eskom workers.

The NUM has been seeking a 9 percent wage raise and an allowance of 2,500 rand.

Eskom’s human resources managing director, Bhabhalazi Bulunga, said it was unlikely the union would carry out the threatened strike because such action would be illegal.

“The next process is to go to arbitration, there is no room for industrial action because this is an essential service and the parties are not far from each other,” he told Reuters.

Union leaders have said arbitration is not an option.

“It will be an illegal strike. We also have a court interdict in force to prevent such action,” he said in reference to a court order obtained by Eskom in May preventing a similar strike threatened by the NUM.

“We are walking slowly, hoping to find each other along the way,” Bulunga said of the talks with the three unions.

Bulunga declined to make public the terms of the new offer, because Solidarity, which represents about 7,500 workers at Eskom, was still consulting its members on the proposal.

Solidarity said in a statement it would give its members’ verdict on Eskom’s offer later on Wednesday.

(Additional reporting by Jon Herskovitz and Shapi Shacinda; Editing by Giles Elgood)

(Reuters) – A strong 6.2-magnitude earthquake struck southern Mexico early on Wednesday, shaking buildings as far away as Mexico City but not causing serious damage or casualties.

The U.S. Geological Survey said the quake struck near the town of Pinotepa Nacional around 80 miles southwest of the colonial city of Oaxaca, but police patrols checking surrounding towns did not report problems.

The USGS reported the quake as strong as magnitude 6.5 but later revised the figure to 6.2, also moving the epicenter slightly.

“It was pretty strong,” said Jorge Cervantes, a security guard at Hotel Las Gaviotas in Pinotepa Nacional. “Some guests went downstairs but the building is fine and nobody is hurt.”

In Oaxaca’s cobblestone historic center people felt the tremor strongly and guests at several hotels evacuated briefly.

“Fortunately, we do not have any reports of injured people or damage to buildings. Not here or on the coast,” said civil protection official Alberto Narvaez in Oaxaca. “It woke me up, I was scared too,” said a colleague, Gilberto Mateo.

The Pacific Tsunami Warning Center had no warning or advisory in place and hotels in beach resorts like Puerto Angel also reported no damage.

The temblor awoke residents in Mexico City nearly 300 miles to the north, and cut power in some districts. Some people filed onto the street in their pajamas, but there were no reports of casualties in the city, where many have grim memories of a devastating earthquake in 1985.

Helicopters whirred overhead and police sirens and car alarms wailed, but power and phone connections were still working.

“I felt it like I almost always do. People came running out of the building,” said Pedro Salazar, 42, a security guard at a four-story historic apartment building in Mexico City.

Mexico is regularly shaken by tremors and is on tenterhooks ever since devastating earthquakes in Haiti and Chile earlier this year.

(Additional reporting by Armando Tovar, Pablo Garibian, Cyntia Barrera and Adriana Barrera; Writing by Catherine Bremer; Editing by Doina Chiacu)

Beijing, China (CNN) — An accident on a ride at a Chinese amusement park has left six dead, and several more injured, Chinese media agencies reported Tuesday.

The passengers on a simulated rocket ride said that the smell of burning electronics and a sudden loss of power preceded the deadly incident at the Overseas Chinese Town East facility in Shenzhen, witnesses told Xinhua news agency.

The Hong Kong-based Ming Pao newspaper reported that one of the 11 capsules on the “Space Journey” ride came detached, slamming into others and leading to the deaths and at least 10 others being injured.

Government officials said only that the exact cause of the accident is still under investigation, while the area surrounding the ride will be closed Wednesday.

The park is popular with Hong Kong residents traveling to the mainland.

DALLAS, CMC – Andrea M. Stoelker, the girlfriend of disgraced financer Allen Stanford, has been sued for US$560,000 she received in wages and other payments from the Stanford Financial Group of Companies.

In papers filed in federal court here on Tuesday, Kevin Sadler, the lead attorney for Stanford receiver Ralph Janvey said that Stoelker’s services included work on Stanford’s Caribbean cricket subsidiary.

He claims that Stoelker was “unjustly enriched’’ while serving as president of both Stanford Financial Group Global Management LLC and Stanford 20/20.

The 20/20 organization promoted a faster version of cricket, which the financier hoped would attract a wider following to the sport. Stoelker received at least US$140,000 from the cricket unit and another US$180,000 from Stanford personally, Janvey claims.

“Any services performed by Stoelker were designed to further the operations of the Ponzi scheme and may well have assisted Stanford in attracting new victim investors,’’ Sadler said in the court documents.

Stoelker, who is identified by Sadler as Stanford’s “girlfriend and/or fiancée,’’ said in her own court filings that she often accompanied Stanford on international business trips and Las Vegas vacations. She also sought, and was denied, the return of her personal belongings taken from Stanford’s yacht when his assets were frozen by a court order and turned over to Janvey in February 2009.

Stanford is in federal prison in Houston awaiting a January trial on charges that he swindled investors of more than US$7 billion through a massive ponzi scheme operated by his Antigua-based Stanford International Bank Ltd (SIBL).

Stanford faces parallel civil fraud allegations from the U.S. Securities and Exchange Commission, which claims he skimmed more than one billion US dollars in investor funds to finance a lavish lifestyle that included multiple mansions, a fleet of jets, two yachts and a private island.

Stanford has denied wrongdoing.

NEW YORK, CMC – A Guyanese national charged in an international plot to blow up fuel lines at the John F. Kennedy International Airport in 2007 has pleaded guilty to furnishing material support to his co-defendants.

“I provided guidance in order to assist them in their plan to attack the fuel line at JFK airport to cause major economic harm to the United States,” Abdel Nur told US District Judge Dora Irizzary, of Brooklyn federal court, one day before he was scheduled to go on trial.

Nur, 60,  was extradited from Trinidad and Tobago to stand trial.

US Prosecutors said he acted as a “go-between” with the alleged mastermind, Guyanese-born Russell Defreitas., 66, a US citizen, who worked as cargo handler at John F. Kennedy International.

An indictment unsealed in 2007 said the men hoped to “cause greater destruction than in the September 11 attacks” by using explosives to ignite a fuel pipeline feeding JFK and to destroy the airport and parts of Queens, where the line runs underground.

The authorities said the plot, which the men code-named Chicken Farm, never got past the planning stages.

Defreitas and fellow Guyanese, Abdul Kadir, 58, a former People’s National Congress parliamentarian, are scheduled to go on trial on Wednesday.

The fourth defendant, Trinidadian Kareem Ibrahim, 59, has been granted a separate trial after he had gone on a hunger strike in prison and became ill. It is now unclear when he would be tried.

Under the plea agreement made public on Tuesday, Nur has avoided the possibility of life in prison if convicted. He now faces up to 15 years in prison, prosecutors said.

“I became aware that individuals who I had known were developing a plan that had as its goal the use of an explosive device or material to destroy or extremely damage fuel tanks or fuel pipelines at the John F. Kennedy international airport,“ Nur told the court, reading from a prepared statement.

“I understand the destruction of the fuel and planes was to cause major economic loss in the U.S.,” he added.

KINGSTON, Jamaica, CMC – Agriculture Minister Dr. Christopher Tufton is accusing Trinidad and Tobago of using unfair practices to dominate the agro-processing sector within the Caribbean Community (CARICOM).

Speaking in Parliament on Tuesday, Tufton said that agro-processors in Trinidad and Tobago have been using raw materials imported from outside the region with “unclear duty arrangements” and as a result local producers were not operating on a level playing field with their Trinidadian counterparts.

“It is a concern to me that my peanut farmers are unable to compete for the demand of agro-processors due to peanuts from our CARICOM partner, imported extra-regionally and processed with subsidised energy,” Tufton said.

While explaining that he supported the regional trading bloc, the minister insisted he was “concerned about that element of our trading arrangement which placed our farmers and agro-processors at a distinct disadvantage”.

Tufton, in his contribution to the 2010-2011 Sectoral Debate, said that for too long Trinidad and Tobago had misinterpreted World Trade Organisation (WTO) rules to Jamaica’s detriment.

He told legislators that Jamaica has allowed free access to its markets but failed to recognise that many competing trade zones enjoyed support from their governments.

“I dare say we in Jamaica, at the policy level, have failed to give our productive sector and primary producers the benefits of these forms of support. At the same time, we allowed our markets to be overrun by external producers who are benefiting from these WTO provisions,” he said.

Meanwhile, the Agriculture Minister said the government plans to take away land from persons who lease State property for agricultural purposes but keep them idle. He said this would be a part of a new agricultural land use policy.

“We will no longer allow persons to lease government agricultural lands and not use it. We intend to standardise leases and the general message will be ‘use it or lose it’.

“For too long our most arable lands have been unaccounted for and subject to inactivity due to lack of information or delinquent leases.” Tufton said.

Waldomar Mariscal, son of Vicky Pelaez, who was arrested by the FBI for allegedly serving as spies for Russia, walks back into the house where his mother was arrested in Yonkers, New York, June 29, 2010. Credit: Reuters/Jessica Rinaldi

(Reuters) - Russia said on Wednesday the U.S. arrests of suspects in an alleged Russian spy ring would not hurt improving relations with Washington, softening its tone after an initial angry response.

The Russian Foreign Ministry at first slammed the U.S. actions as “baseless and improper” and hinted the arrests could dampen Moscow’s enthusiasm for warmer ties, raising the specter of a Cold War style diplomatic stand-off.

But on Wednesday the Foreign Ministry expressed optimism that the fall-out would not ruin the relationship “reset” initiated by U.S. President Barack Obama and embraced by Russian President Dmitry Medvedev.

“We expect that the incident involving the arrest in the United States of a group of people suspected of spying for Russia will not negatively affect Russian-U.S. relations,” a Foreign Ministry official said on condition of anonymity.

The U.S. Justice Department on Monday announced it had arrested 10 suspected spies in four eastern cities. An 11th suspect was arrested in Cyprus on Tuesday and freed on bail.

The suspects were accused of seeking information on issues ranging from nuclear weapons research to the global gold market and CIA job applicants, according to U.S. prosecutors.

With buried banknotes, coded communications and ritualized rules for secret handoffs, the U.S. accusations echoed spy scandals of the Soviet era and the more recent chill in relations with a Kremlin which, during the 2000-2008 presidency of former KGB officer Vladimir Putin, often accused the West of trying to weaken Russia through espionage.

But analysts said neither nation is in the mood for a new downturn in relations.

Russia is counting on U.S. backing to clinch entry into the World Trade Organization, where it is the largest economy still banging on the doors after a 17-year accession campaign.

That support was high on Medvedev’s agenda at a summit with Obama last week that followed a visit to California’s Silicon Valley, a hub of U.S. expertise crucial to Russia’s uphill battle to modernize its overly resource-reliant economy.

Obama needs Russia on his side for efforts to rein in Iran’s nuclear program, keep supply lines open to forces in Afghanistan and advance his goal of progress toward a world without nuclear arms.

“It is absolutely evident that the scandal will wind down, as neither side wants a disruption of the ‘reset’,” said Alexander Golts, a Russian military analyst.

DAMAGE CONTROL

The relatively mild Russian rhetoric clearly indicated that the Kremlin wants to limit the damage, Golts said.

Putin sent that message on Tuesday, telling ex-U.S. President Bill Clinton that U.S. police were “out of control” and “throwing people in jail.” But he then added that they were just doing their job, and stressed he hoped the spy scandal would not reverse “all the positive gains.”

Russian-U.S. ties deteriorated steadily after the U.S.-led invasion of Iraq in 2003, which Putin vehemently criticized, and hit new lows when Russia sent forces into pro-Western Georgia in a five-day war in 2008.

Washington has also signaled it does not want the arrests to dent the upswing in relations.

“We’re moving toward a more trusting relationship,” State Department official Philip Gordon said on Tuesday. “We’re beyond the Cold War.”

Russia backed new sanctions against Iran this month, and Medvedev and Obama signed a major nuclear arms pact in April.

(Additional reporting by Alexei Anishchuk; Editing by Jon Hemming)

WASHINGTON, CMC – The United States Securities and Exchange Commission (SEC) says it has filed charges against a US Virgin Islands-based fund manager who used the National Bank of Anguilla to deposit funds he raised in a multi-million dollar Ponzi scheme.

The SEC said that Daniel Spitzer “perpetrated a US$105 million Ponzi scheme against investors” and “used several entities and sales agents to misrepresent to investors that their money would be invested in investment funds that, in turn, would be invested primarily in foreign currency.

“Investors were falsely told that Spitzer’s funds had never lost money and historically produced profitable annual returns that one year reached over 180 percent,” the SEC said in a statement.

It said that Spitzer used money raised from new investors to pay earlier investors, and misappropriated investor funds to pay unrelated business expenses.

“He concealed his scheme by issuing phony documents to investors that led them to believe their investments were profiting,” the SEC said, adding that it has obtained an emergency court order freezing the assets of Spitzer and his companies.

According to the SEC’s complaint, filed in US District Court for the Northern District of Illinois, Spitzer conducted the alleged fraudulent scheme, which involved 400 investors, from at least 2004 to present.

It said he only invested about US$30 million of the more than US$105 million he raised from investors. Of that amount, Spitzer used about US$13.5 million to invest through an offshore entity via a bank account in the Netherlands Antilles, the indictment charged

The SEC alleged that Spitzer used offshore bank accounts to pay purported business expenses of his companies.

It also charged that he deposited investor funds into bank accounts at the National Bank of Anguilla and the First Bank of Puerto Rico, from which he paid more than US$15 million in purported operating expenses and payments to himself and various sales agents.

Spitzer also used more than US$4.8 million to pay third-party business expenses, the SEC charged.

According to the SEC’s complaint, Spitzer’s scheme is “on the verge of collapse as he has attempted to delay and avoid paying investor redemptions.”

As recently as March 2010, the SEC claimed that Spitzer obtained US$100,000 from an unidentified investor for an investment in one of his “purportedly more conservative investment funds.”

“Rather than invest the money, Spitzer used a portion of the money in April 2010 to pay other investors and third-party expenses,” the complaint alleged.

In February 2009, the SEC filed a civil lawsuit against Texas financier Allan Stanford, accusing him of masterminding a US$7 billion Ponzi scheme involving his Antigua and Barbuda-owned Stanford International Bank.

Stanford, who is currently jailed in Houston, Texas, has repeatedly denied any wrongdoing. He goes on trial in January.

Miami, Florida (CNN) — Hurricane Alex aimed its fury toward northeastern Mexico and southern Texas but was “moving in no hurry,” the National Hurricane Center said Wednesday morning.

The Category 1 storm, which became the first June hurricane to form on the Atlantic side of the United States since 1995, is expected to make landfall in Mexico late Wednesday or early Thursday.

At 11 a.m. ET, Alex was moving toward the northwest in the Gulf of Mexico at 7 mph, the National Hurricane Center reported. The storm had maximum sustained winds of 80 mph, and its center was about 190 miles southeast of Brownsville, Texas, and about 145 miles east of La Pesca, Mexico.

President Obama issued a federal emergency declaration for Texas ahead of Alex’s expected arrival, the White House said Tuesday night.

A hurricane warning was issued for the Gulf Coast from Baffin Bay, Texas, to La Cruz, Mexico. A hurricane warning means that hurricane conditions and tropical storm-force winds are expected in the forecast area within 36 hours.

A tropical storm warning was in place along the Texas coast from Baffin Bay to Port O’Connor.

The storm continued to move away from the massive BP oil catastrophe near the Louisiana coast in the northern Gulf of Mexico, but it already was complicating cleanup efforts. The storm created 12-foot waves Tuesday, and oil-skimming ships were sent to shore from Louisiana to the Florida Panhandle.

The rough seas may force crews to replace and reorganize booms meant to deter the oil from reaching shore, CNN’s Ed Lavandera reported.

Florida Gov. Charlie Crist said that even though Florida may dodge any problems with this storm, the Atlantic hurricane season is just beginning.

“In Florida, we’ve had a lot of hurricanes a number of years ago, but we handled them very well,” he told CNN’s Campbell Brown. “The difference and the distinction that we face now is that we have a Gulf of Mexico that’s full of oil. So our hope and our prayer is that we don’t have a mixture of hurricanes with oil that could potentially damage the beautiful beaches of Florida. But if we do, we’re prepared for it.”

Pat Ahumada, the mayor of Brownsville, Texas, said the city was expecting to distribute 60,000 sandbags and provide shelter for roughly 2,000 families. Utility crews were on standby to handle outages. At the same time, the state government provided 90 buses in case an evacuation is needed.

“I expect about 10 percent of residents to evacuate voluntarily, which already started yesterday,” Ahumada said Tuesday. “I see a steady flow of people going out, but no bottlenecks — which is good.

“We’re not taking it lightly,” he said. “We’re ready for a worst-case scenario.”

On Monday, Texas Gov. Rick Perry issued a disaster proclamation for 19 counties and ordered the predeployment of state resources. The governor’s declaration allows the state to initiate necessary preparedness efforts, such as predeploying resources to ensure local communities are ready to respond to disasters.

The governor’s order puts up to 2,500 National Guard personnel, eight UH-60 helicopters and three C-130 aircraft on standby for rapid deployment as needed, Perry’s office said in a statement.