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The Morning Risk Report: Google Resists Demand From States in Digital-Ad Probe
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Google is concerned that the probe led by Texas Attorney General Ken Paxton has been advised by consultants who could share confidential information with rivals. PHOTO: TONY GUTIERREZ/AP
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Good morning. Google is resisting efforts to surrender emails, text messages and other documents sought by state investigators probing possible anticompetitive practices, according to records and interviews.
Google, a unit of Alphabet Inc., also hasn’t agreed to a waiver that would give the coalition of state attorneys general access to documents obtained by the Justice Department for its own probe, according to a person familiar with the situation.
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Texas Attorney General Ken Paxton, who is leading the investigation by 48 states, the District of Columbia, Puerto Rico and Guam, said the company’s actions suggest it is withholding information that could be damaging.
“Every indication right now is they don’t believe that they’re clean because they don’t act in any way like they are,” Mr. Paxton said in an interview.
A Google spokeswoman said the company has cooperated with the probe but raised concerns that the Texas-led investigation has been advised by outside business consultants who could share confidential information from Google with rival companies.
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From Risk & Compliance Journal
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U.S. Blacklists Senior Iranian Officials Ahead of Parliamentary Election
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The U.S. imposed sanctions on five senior Iranian officials for allegedly preventing fair and free elections in Iran, the U.S. Treasury Department said. The sanctions came ahead of Iran’s parliamentary elections on Friday, for which the country’s leadership is trying to rally a large turnout to bolster itself against a rise in domestic discontent.
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Paris Saint-Germain chairman Nasser Al-Khelaifi was indicted after a three-year probe into the sale of World Cup television rights. PHOTO: FRANCK FIFE/AGENCE FRANCE-PRESSE/GETTY IMAGES
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The chairman of soccer side Paris Saint-Germain and head of the BeIN Media Group, Nasser al-Khelaifi, was indicted by Swiss prosecutors following a three-year probe into the sale of World Cup television rights. A more serious charge of bribery, however, was dropped after soccer authorities withdrew their complaint against him.
Mr. Al-Khelaifi, a Qatari businessman who also serves on the top committee of European soccer’s governing body, was charged with inciting former FIFA No. 2 Jérôme Valcke “to commit aggravated criminal mismanagement,” the office of the Swiss Attorney General said.
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Separately, Switzerland’s market watchdog criticized private bank Julius Baer Gruppe in connection with money-laundering claims involving the FIFA soccer federation and Venezuela’s national oil company. The Swiss Financial Market Supervisory Authority the Zurich-based bank had fallen “significantly short” in combating money laundering in the period between 2009 and 2018.
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A global terror-finance watchdog agency is set to blacklist Iran, broadening a U.S. effort to isolate Tehran financially and potentially strain the already sanctions-battered Iranian economy.
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Sprint and T-Mobile agreed on new terms for their merger, as the wireless carriers race to close the deal after overcoming a federal court challenge. The parties will improve the exchange ratio in the all-stock deal in favor of T-Mobile’s parent, Deutsche Telekom, the companies said. U.S. District Judge Victor Marrero last week allowed the deal to proceed by rejecting arguments from a group of state attorneys general seeking to block it as anticompetitive.
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The U.S. Indian Health Service says it can’t disclose a report that identifies the officials responsible for mishandling a government pediatrician who abused Native American boys for decades, citing a law meant to protect medical reviews. That stance has angered relatives of the pediatrician’s victims, tribal members and former agency employees who hoped the report would provide a public reckoning and greater accountability for those who didn’t do enough to protect Native American children.
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Some U.K. regulators are seeking to strengthen climate-change-related reporting requirements. PHOTO: JASON ALDEN/BLOOMBERG NEWS
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The accounting and audit regulator for the U.K. and Ireland said it would review how companies and auditors are assessing and reporting on the impact of climate change on their business.
The Financial Reporting Council said its review would involve, among other things, assessing whether companies are complying with climate-change-related reporting requirements and whether auditors are ensuring that climate risks are reflected in company reports and accounts.
“Not only do boards of U.K. companies have a responsibility to report their impact on the environment and the risks of climate change to their business, but investors expect them to operate sustainably,” Jon Thompson, chief executive of the FRC, said in prepared remarks.
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Anglo American CEO Mark Cutifani. Four of the company’s employees were killed at its managed operations in 2019. PHOTO: MIKE HUTCHINGS/REUTERS
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Anglo American, one of the world’s largest miners, gave a full picture of fatalities related to its operations, a major shift in an industry that typically undercounts the number of deaths.
A Wall Street Journal investigation revealed in December that many mining deaths aren’t captured by global safety statistics, making the industry seem safer to regulators, investors and consumers.
Anglo’s disclosure “represents a very significant development which can and should become an industry standard,” said Adam Matthews, director of ethics and engagement at the Church of England Pensions Board, which has around $3.3 billion under management.
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A Cathay Pacific employee speaking with a passenger at Hong Kong International Airport in February. PHOTO: IVAN ABREU/BLOOMBERG NEWS
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Airlines around the world are counting the cost of the coronavirus that has led to thousands of China flights being canceled, with several Asian airlines teetering on the brink of ruin if the nation’s shutdown persists.
Many carriers have taken emergency measures in hope of offsetting expected losses resulting from the continuing slump in global traffic. In Hong Kong, Cathay Pacific Airways—already feeling the impact of the city’s antigovernment protests—has asked all its staff to take three weeks’ unpaid leave, while Hong Kong Airlines has sacked more than 400 workers. Asiana Airlines, South Korea’s second largest carrier, also asked thousands of staff to take unpaid leave.
Norwegian Cruise Line Holdings Ltd., meanwhile, said it has canceled its voyages in Asia across three brands through the end of September as the coronavirus epidemic weighs on its bottom line.
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A.P. Moeller-Maersk is facing a weak year as the coronavirus outbreak takes a toll on shipping volumes and freight rates after broader market conditions sent the Danish shipping giant to an unexpected fourth-quarter loss. The world’s biggest container ship operator, said it has canceled dozens of sailings out of China since late January as factories there were closed for an extra week after the Lunar New Year and struggled to resume production.
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Royal Dutch Shell, the global leader in liquefied natural gas sales, said the coronavirus outbreak was hurting demand for the supercooled fuel and prompting it to reschedule or locate new buyers for cargoes previously allocated to the Chinese market.
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The office of New Mexico Attorney General Hector Balderas accuses Google of violating the federal Children’s Online Privacy Protection Act. PHOTO: SUSAN MONTOYA BRYAN/ASSOCIATED PRESS
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New Mexico sued Google, alleging that the internet giant knowingly spies on students and their families through its Google Education platform. The state says Google has used the platform to circumvent privacy laws and gain access to children’s personal data and movements online—including students’ physical locations, visits to websites, internet searches—according to a complaint filed Thursday in federal court in Albuquerque.
“These claims are factually wrong,” Google spokesman Jose Castaneda said in an emailed statement.
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The U.S. and Britain joined Georgia in blaming Russia for a large-scale cyberattack that knocked out thousands of government, private and media websites in the Caucasian country in October. Secretary of State Mike Pompeo and British Foreign Secretary Dominic Raab attributed the attack to the GRU, the Russian military spy agency that Western officials allege is responsible for a raft of overseas operations, including an attempt to interfere with the 2016 U.S. presidential campaign.
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Company founder Les Wexner will keep a seat on L Brands’ board. PHOTO: ADAM CAIRNS/ZUMA PRESS
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Les Wexner’s decision to part ways with Victoria’s Secret is an admission that the 82-year-old billionaire couldn’t revive the fortunes of a troubled lingerie brand he had built around shopping malls and sex appeal.
He agreed to sell a controlling stake in the chain to private-equity firm Sycamore Partners for $525 million and step down from his roles as chairman and chief executive of its parent company, L Brands Inc.
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The founders of $6.9 billion hedge-fund firm Senator Investment Group are splitting up after 12 years together, following a rift that had grown between the two.
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Volkswagen Chief Finance Officer Frank Witter said he plans to step down at the end of June 2021 for personal reasons.
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Railway blockades like this one in Edmonton, Alberta, have interrupted supply chains. PHOTO: CODIE MCLACHLAN/REUTERS
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Canada’s economy is facing a blow from two weeks of protests that have blocked multiple railway lines, stranding shipments and snarling supply chains in key commercial corridors.
The country’s largest passenger-rail operator issued temporary layoff notices for 1,000 workers, a day after Canadian National Railway Co. said it would temporarily lay off 450 workers of its own. Factories in central Canada could be next in sending workers home, said the head of a national lobby for manufacturers and exporters.
Economists said the stoppages threaten to shave 0.1% to 0.3% from economic output in February, adding the damage could be greater the longer the interruption drags on.
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Swiss asset manager GAM Holding said it would slash jobs and streamline its operations as part of a new cost-cutting strategy aimed at stabilizing itself after nearly two years of turmoil. GAM, once owned by UBS Group, has been struggling to improve its profitability after it dismissed a star bond-fund manager for alleged misconduct and liquidated some funds, prompting investors to pull billions of francs.
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After buying E*Trade, Morgan Stanley would have more than 4,000 corporate customers. PHOTO: ANDREW HARRER/BLOOMBERG NEWS
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Morgan Stanley is buying E*Trade Financial in a $13 billion deal that will reshape the storied investment bank and firmly stake its future on managing money for regular people. The all-stock takeover will combine a Wall Street firm in the late innings of a decadelong turnaround with a discount broker built on the backs of dot-com day traders. It is the biggest takeover by a giant U.S. bank since the 2008 crisis.
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Ultimate Software and Kronos Inc. are merging in a deal creating a big new player in workplace-software products. The all-stock deal will create a company worth roughly $22 billion including debt, the companies said. Kronos CEO Aron Ain will lead the combined company, which will have more than 12,000 employees.
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