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The Morning Risk Report: Carnival, Under Court Order, Gives Compliance Unit More Independence
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Carnival agreed to appoint an executive-level compliance chief after it admitted dumping plastic waste. Pictured, a Carnival cruise ship passing Miami Beach. PHOTO: ANDY NEWMAN/AP
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When Carnival Corp. names its first chief compliance officer, as it is expected to do soon, the appointment will be a symbolic step in the cruise-line operator’s effort to move on from years of legal woes, Risk & Compliance Journal’s Kristin Broughton reports.
The position will answer to the chief executive and the board, underscoring how compliance will play a bigger role in Carnival’s leadership as the company attempts to strengthen and consolidate its controls across the patchwork of companies stitched together through three decades of acquisitions.
[Continued below...]
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The Miami-based company didn’t choose to restructure the compliance unit. It agreed to the executive-level appointment as part of a $20 million settlement last month, in which Carnival and a subsidiary admitted to dumping plastic waste into the ocean and falsifying environmental training records, among other violations.
Prosecutors said Carnival violated the terms of a 2017 probation agreement stemming from a guilty plea by one of its subsidiaries, which agreed to pay a $40 million fine for illegally dumping oily water overboard and attempting to conceal it. Carnival said in interviews the move will strengthen its ability to manage its far-flung operations, offering a glimpse of how one company, albeit under a court order, is strengthening its compliance function.
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From Risk & Compliance Journal
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The skyline of Havana, Cuba. The U.S. imposed sanctions on the Cuban state oil import and export company, alleging they continue to import oil from Venezuela. PHOTO: TAMPA BAY TIMES/ZUMA PRESS
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The U.S. imposed sanctions on Cubametales, alleging the Cuban state-run oil import and export company continues to import oil from Venezuela, the U.S. Treasury Department said Wednesday. The designation comes as the U.S. ramps up pressure on Havana over its support of the Nicolás Maduro regime in Venezuela, which the Trump administration has said is illegitimate and corrupt.
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Serco Group PLC said Wednesday that a subsidiary agreed to pay about $24 million (£19.2 million) to settle fraud and false accounting charges brought by the U.K.’s Serious Fraud Office. The deferred prosecution agreement with Serco Geografix Ltd. resolves a six-year probe into the government services company, which the SFO says misled the U.K.’s Ministry of Justice about profit made from a contract to provide electronic monitoring of offenders between 2010 and 2013. Meanwhile, a U.K. regulator has fined and reprimanded Deloitte LLP and
one of its partners for shortfalls in its audits of Serco Geografix. The rebuke comes as the country looks to boost the quality of its audit sector.
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A former Deutsche Bank AG trader was cleared by a London court of charges related to the rigging of a key European interbank-lending rate.
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An international organization has called on Japan to step up enforcement of its foreign-bribery laws, saying the Asian nation has one of the least stringent enforcement rates given the size and range of its economy.
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A handout image of Iranian President Hassan Rouhani inspecting nuclear technology in Tehran in April. PHOTO: IRANIAN PRESIDENCY/EPA/SHUTTERSTOCK
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Tighter new U.S. sanctions have proved more punishing than Iran’s leaders expected, driving Tehran to hit back militarily and breach limits it had agreed to put on its nuclear program. Iran said it was taking steps to increase uranium enrichment that would break limits set in a 2015 nuclear deal by Monday morning, violating for the second time elements of the multiparty accord and putting it at risk of collapse. Last Friday, the U.S. called for a special session of the United Nations atomic agency board, increasing the pressure on Europe and others to take a stand against Iran after Tehran said it breached the 2015 nuclear treaty. Meanwhile, Iran demanded the immediate release of one of its tankers impounded with the help of British forces in Gibraltar this week, an incident that has angered Tehran and exacerbated tensions between Iran and Western countries.
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Banks, asset managers and public companies could find it easier to settle regulatory enforcement actions without damaging other parts of their business. The Securities and Exchange Commission said Wednesday a company can now negotiate a penalty while at the same time seeking the waivers needed to limit the consequences of its alleged misconduct.
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Prosecutors charged former Malaysian Prime Minister Najib Razak’s stepson, who co-founded the company that produced “The Wolf of Wall Street,” with five counts of money-laundering on Friday in relation to one of the world’s biggest financial scandals.
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New York legislation establishing the country’s highest standards for reducing greenhouse-gas emissions has companies scrambling to determine how much it will cost to comply. State lawmakers in June passed the Climate Leadership and Community Protection Act, which by 2050 requires an 85% reduction in greenhouse-gas emissions from the 1990 level. For all its sweeping changes, the legislation is light on details.
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Britain’s competition regulator is reviewing Amazon.com Inc.’s investment in U.K. food-delivery startup Deliveroo, as the expansion of Silicon Valley giants heightens antitrust concerns in markets around the globe.
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Chinese authorities are directing Anbang Insurance Group to sell off assets more quickly, seeking to shrink the troubled company to roughly half its previous size.
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Adobe implemented the revenue-accounting rule on Dec. 1 for the first quarter of the 2019 fiscal year. PHOTO: DADO RUVIC/REUTERS
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The Securities and Exchange Commission’s queries to Adobe Inc. on how it is implementing the new revenue accounting standard shows the regulator’s efforts to push companies into revealing more about how they are complying with the new rules. The San Jose, Calif.-based software company is the latest U.S. firm to grapple with the new accounting guidelines, which came into effect at the start of last year for most public companies and aim to unify how companies from different industries account for revenue from sales and services.
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Colt’s Manufacturing is one of the defendants involved in a wrongful-death lawsuit filed by the parents of a woman killed in the 2017 Las Vegas massacre. PHOTO: BLOOMBERG
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The parents of a woman killed in the 2017 Las Vegas massacre have filed a wrongful-death lawsuit against the manufacturers of the AR-15 style rifles used by the gunman. The complaint, filed in state court in Nevada Tuesday, alleges that the makers of the 12 different semiautomatic rifles used in the mass shooting knew they could be easily modified to fire like fully automatic machine guns. The manufacturing and sale of new fully automatic weapons is prohibited under federal law.
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Canned soup made Campbell Soup Co. an icon of 20th-century consumer culture. This century, the soup business has become a millstone for the Camden, N.J.-based company. Campbell’s soup sales in the U.S. have fallen eight out of its past 10 fiscal years, according to its annual reports. The struggle reflects challenges facing many big food makers that have seen customers abandon older brands for products that they perceive as fresher and more healthy.
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Amazon.com Inc. has been on a buying spree in recent years, but the U.S. government’s increased scrutiny of large tech companies threatens to slow that pace.
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A drone in the works at Impossible Aerospace’s Santa Clara, Calif., facility, a former floppy-disc factory. PHOTO: CAYCE CLIFFORD FOR THE WALL STREET JOURNAL
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Citing national security, lawmakers are looking to ban military purchases of Chinese-made drones—which could boost prospects for U.S. makers struggling to compete.
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China’s Huawei Technologies Co. disputed findings from a U.S. cybersecurity firm that its gear is far more likely to contain flaws than equipment from rival companies, characterizing the analysis as incomplete and inaccurate.
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The Boeing 737 MAX has been grounded since a pair of fatal crashes. PHOTO: STEPHEN BRASHEAR/GETTY IMAGES
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Boeing Co. Sunday lost a deal for 737 MAX jetliners in one of the first tangible signs the crisis around the plane could shift business to European rival Airbus SE. Saudi Arabia’s flyadeal Sunday said it would buy up to 50 Airbus A320neo planes, the direct rival to Boeing’s MAX that has been idled globally in the wake of two crashes within less than five months.
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Bruce Linton was removed as Canopy Growth’s chairman and co-chief executive officer on Wednesday. PHOTO: SIMON DAWSON/BLOOMBERG NEWS
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The leader of one of Canada’s biggest cannabis companies said he was pushed out because of differences with Constellation Brands Inc. over strategy and spending decisions, less than a year after the Corona brewer bet $4 billion on Canopy Growth Corp.
Bruce Linton, who started Canopy Growth in 2013, was removed as chairman and co-chief executive officer on Wednesday. The announcement followed public criticism from Constellation CEO Bill Newlands, a Canopy board member, who last week said he wasn’t pleased with the marijuana grower’s recent results.
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The Deutsche Bank, headquarted in Frankfurt, Germany, unveiled restructuring plans expected to eliminate thousands of jobs and reorder the bank’s executive ranks. PHOTO: ALEX KRAUS/BLOOMBERG NEWS
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Deutsche Bank AG moved to gut its global ambitions as a trading powerhouse, cutting 18,000 jobs and retreating to its German banking roots in a radical overhaul to try to save itself after years of decline. The bank’s investment-banking chief, Garth Ritchie, reached an agreement with the embattled German lender to leave the bank at the end of July, the bank said. He’s expected to stay through a transition period ending in November.
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Univision Communications Inc. is exploring strategic options including a possible sale, according to people familiar with the matter. The company is grappling with debt, the consequence of a $13.7 billion leveraged buyout in 2006 when the company was taken private. Univision said it finished 2018 with $7.4 billion in debt but reduced its total debt by $547 million last year.
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WeWork Cos. has a plan to shore up confidence in its business before it goes public: offer billions of dollars in debt that would fund its growth until it can turn a profit. The money-losing office-space manager is seeking to raise as much as $3 billion to $4 billion in coming months through a debt facility that could grow as big as $10 billion over the next several years, the people said. This debt offering would be independent of the money WeWork raises in its initial public offering and could even raise more money for the company than the IPO itself.
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Iconic humor publication MAD Magazine is saying goodbye to newsstands, according to a person familiar with the situation. Starting with issue No. 10, which goes on sale in October, the magazine will be available only in comic-book stores and will also be mailed directly to subscribers, the person said. As of issue No. 11, MAD will no longer publish new, original content with the exception of end-of-year specials.
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Trucking fleets added 4,300 jobs in June, the Labor Department said in a report Friday. PHOTO: SCOTT OLSON/GETTY IMAGES
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Transportation and logistics companies added jobs at a strong pace in June, in a rebound from weak hiring this spring and a sign of growing confidence in U.S. freight demand. Couriers and messengers boosted payrolls by 6,500 jobs last month while trucking fleets added 4,300 jobs, the Labor Department said in a report Friday that included upward revisions for the past two months in trucking employment.
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