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The Morning Risk Report: Chevron Has Second Thoughts About Venezuela |
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Filling up in Puerto Piritu, Venezuela. The government provides gasoline almost free. PHOTO: CARLOS BECERRA FOR THE WALL STREET JOURNAL
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Good day. Chevron Corp. has weathered dictatorships, coups and nationalization drives in Venezuela over its nearly centurylong time in the country, but executives there are debating whether it may be time to leave.
Chevron's dilemma is both moral and commercial. It hopes to outlast President Nicolás Maduro, as it has others, but staying risks damage to the company's reputation. Adding to the conundrum is the fact that the company isn't making much money in the country, and Chevron is aware that a pullout could trigger a collapse in the government's finances.
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Chevron has put up with many provocations in Venezuela, including late payments, requests for employees to attend political rallies and bickering over loans Caracas sought because it couldn't afford oil-field maintenance. Joint ventures with the state oil company are regularly subjected to what Venezuelan prosecutors call corrupt overcharging by vendors.
Graft and the risk it will worsen have weighed on executives as they consider Chevron's position in the country. It has become harder to stomach since the money disappeared from the Venezuelan operations, people familiar say.
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| From Risk & Compliance Journal |
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Top Commodities Firms of Engaged Risky Middlemen, Group Alleges |
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The top three global commodity trading firms used or engaged middlemen with links to a massive Brazilian corruption investigation, according to antigraft group Global Witness. All three firms have denied wrongdoing.
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U.S. Targets Crimean Resort Amid Sanctions on Russia |
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The U.S. Treasury Department said it put new sanctions on three individuals and nine entities over Russia’s intervention in Ukraine, targeting, among other things, a Yalta resort.
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Acting Attorney General Advised Company Accused of Scam |
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Matthew Whitaker, appointed acting attorney general this week, was a paid advisory-board member of an invention-promotion company shut down by regulators as an alleged scam.
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U.S. Sues UBS Over Mortgage Securities |
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The U.S. Justice Department filed a civil suit against UBS AG over "catastrophic" losses incurred by investors from mortgage-linked securities sold in the run-up to the financial crisis. UBS has vowed to fight the lawsuit.
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SEC Settles Charges With EtherDelta Founder |
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The Securities and Exchange Commission said Thursday it has reached a settlement with the founder of a digital-token trading platform for operating an unregistered exchange.
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FTC Alleges Major Real-Estate Scam |
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The Federal Trade Commission announced a law-enforcement action against a residential resort development in Belize, calling it "the largest-ever overseas real-estate investment scam" the agency had ever targeted.
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MoneyGram Extends U.S. Agreement, to Pay $125 Million |
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MoneyGram International Inc. said it extended and amended a deferred-prosecution agreement with the U.S. Justice Department. The Federal Trade Commission said the company agreed to pay $125 million to allegations it failed to crack down on fraudulent transfers.
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China Violated Obama-Era Cybertheft Pact, U.S. Official Says |
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China has violated an accord it signed with the U.S. three years ago pledging not to engage in hacking for the purpose of economic espionage, a senior U.S. intelligence official said Thursday.
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Toshiba to Get Out of U.K. Nuclear, U.S. Gas Businesses |
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Toshiba Corp. said it would liquidate its U.K. nuclear business and sell its U.S. natural-gas business, taking a combined loss of nearly $1 billon. The move is intended to clear legacy problems after waves of restructuring.
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Federal Judge Blocks Keystone XL Pipeline Permit |
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A federal judge in Montana blocked the Trump administration’s permit allowing the Keystone XL pipeline and barred any construction of the long-delayed project until completion of a supplemental environmental review.
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Ad Agencies That Hide Media Rebates Could Face Legal
Exposure |
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Advertising agencies that engage in suspect ad-buying practices could be exposed to liability for wrongdoing such as wire fraud and racketeering, according to the trade group that uncovered it.
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Monster Cries Foul Over Coke Plan to Launch Energy
Drinks |
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Coca-Cola Co. plans to launch a line of energy drinks. Monster Beverage Co. executives disclosed that Coke filed an arbitration claim to resolve a dispute over whether a Coke energy drink would violate a deal they struck in 2015.
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Google to End Forced Arbitration for Sexual-Harassment Claims |
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Alphabet Inc.'s Google said it would end its requirement for sexual-harassment claims to be handled in private arbitration, a move coming a week after thousands of workers walked out of the company's offices around the world.
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McDonald’s Serves Local Fries and a Side of Realpolitik in
Russia |
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McDonald's Corp. boosted its share of Russian suppliers to its restaurants to 98% and embarked on a marketing campaign to drive home its point that, in Russia, McDonald's doesn't have to be American company.
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Wells Fargo Ends Investigation Over Bias Against Women |
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Wells Fargo Co. has ended its investigation into alleged gender bias in its wealth-management division, people familiar with the matter said. Jon Weiss, the unit’s top executive, told some managers on a call last week that “there is unequivocally no gender bias” in the unit.
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Google Picks Geisinger CEO to Oversee Health-Care Initiatives |
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Alphabet Inc.'s Google is expected to name David Feinberg, a prominent hospital-system chief executive, to a newly created role overseeing the company's health-care efforts.
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P&G Moves to Streamline Its Structure |
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Proctor & Gamble Co. said it would revamp its management structure, shrinking the number of business units to six and giving the heads of those products more control.
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Tesla’s New Chairman Faces Governance Challenges |
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Tesla Inc. named Robyn Denholm as its new chairman, replacing Chief Executive Elon Musk. She faces the tough task of reining in Mr. Musk at a crucial time for the electric car maker.
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Some Directors in Hong Kong Forget How Many Boards They're
On |
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Hong Kong has 113 companies with a director who serves on more than six boards, according to an analysis by Bloomberg News. Just 39 companies on the New York Stock Exchange and eight in London can say the same.
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KPMG Stops Consulting for U.K. Clients It Audits |
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Accounting firm KPMG said it will no longer do consultancy work for the U.K.'s biggest companies if it also audits their books. The firm's chairman said in a memo it was to "remove even the perception of a possible conflict."
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Readers can subscribe to The Morning Risk Report here. Follow us on Twitter at @WSJRisk.
Follow the WSJ Risk & Compliance Team on Twitter: @WSJRisk, @srubenfeld and @_MengqiSun.
Send complaints, comments and kudos to editor Jack Hagel at Jack.Hagel@wsj.com
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