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The Morning Risk Report: Biden Administration Weighs New Sanctions Against Belarus
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Sviatlana Tsikhanouskaya visited a Washington rally for Belarusian rights last week. PHOTO: BRYAN OLIN DOZIER/ZUMA PRESS
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Good morning.The Biden administration is considering a new round of economic sanctions targeting Belarus and its authoritarian leader after a leading dissident appealed to U.S. officials for stronger U.S. action, according to participants in meetings last week in Washington.
The new sanctions would be in addition to punitive measures imposed by the administration earlier this year and would aim to further isolate the leader, Alexander Lukashenko, nearly a year after he initiated a crackdown on a popular uprising in the country, according to a Belarusian political adviser.
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The administration’s deliberations come on the heels of a visit to Washington last week by Sviatlana Tsikhanouskaya, who opposed Mr. Lukashenko in last year’s contested election. In meetings with lawmakers and senior administration officials, Ms. Tsikhanouskaya pressed for tougher sanctions.
Ms. Tsikhanouskaya met with President Biden’s top two foreign-policy aides, national security adviser Jake Sullivan and Secretary of State Antony Blinken. Mr. Biden didn’t meet with the dissident leader.
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From Risk & Compliance Journal
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Star Entertainment Withdraws Crown Merger Proposal on License Worries
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The Star Entertainment Group Ltd. withdrew its indicative proposal to merge with Crown Resorts Ltd. over concerns its rival could lose its casino license in Melbourne. Star on Friday said issues raised by Victoria state’s quasi-judicial inquiry into Crown’s suitability to hold a license generated too much uncertainty for the proposal to proceed. It also said it had limited engagement with Crown on the proposal.
With Crown mired in allegations of money-laundering and links to organized crime figures, Mr. Packer’s CPH agreed in April to neutralize most of its influence over Crown in an effort to quell some regulatory concerns. CPH can’t appoint nominees to Crown’s board until October 2024 and can’t talk to the company about its operations privately.
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The spying scandal surrounding Iqbal Khan led to Credit Suisse’s chief executive being forced out. PHOTO: ARND WIEGMANN/REUTERS
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Credit Suisse Group AG said it reached a settlement with a former executive and private investigators over a spying scandal that rocked the bank.
In fall 2019, the Swiss bank hired investigators to spy on Iqbal Khan, a top wealth-management executive who was leaving to join rival UBS Group AG . Mr. Khan spotted one of the investigators and went to the police, setting off international headlines and leading to the ouster of the bank’s chief executive over the reputational fallout.
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The U.K.’s competition authority is stepping out of the shadow of the European Union, launching a flurry of new cases against big tech companies and becoming a new source of global scrutiny for the industry.
Earlier this month, the British government said it would bolster the Competition and Markets Authority, the country’s longtime competition watchdog, granting it new powers to move more quickly to probe and fix anticompetitive behavior. The move would also strengthen its ability to fine companies and prevent takeovers that might stymie competition.
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Sen. Elizabeth Warren is bolstering efforts by Democratic lawmakers to stop the owners of OxyContin maker Purdue Pharma LP from using the company’s bankruptcy to shield themselves from lawsuits blaming them for the opioid crisis.
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The Justice Department dropped cases against five visiting researchers accused of hiding their affiliations with China’s military, in a major setback to a landmark effort to root out alleged Chinese intelligence-gathering in the U.S.
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Huawei Technologies Co. has hired veteran Democratic lobbyist Tony Podesta —whose firm imploded in 2017 amid financial and legal troubles—as part of the Chinese company’s expanded U.S. influence operation, according to people familiar with the matter.
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Tom Barrack, the real-estate investor and longtime ally of former President Donald Trump, was freed from detention Friday on $250 million bond after striking a deal with federal prosecutors for his release before trial on charges that he worked as a foreign agent of the United Arab Emirates.
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The Florida attorney general asked the Supreme Court Friday for an emergency order blocking federal Covid-19 regulations for cruise ships, arguing in the state’s latest challenge that the damage to the tourism industry outweighs their public-health benefits.
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The Financial Reporting Council said KPMG’s auditing performance was unacceptable. PHOTO: JACK TAYLOR/GETTY IMAGES
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The U.K.’s accounting regulator said audits performed by the big four accounting firms and smaller rivals failed to meet expectations, raising troubling questions about the financial statements upon which investors rely.
The Financial Reporting Council, which oversees the U.K. arms of international auditing firms, said that the performance of Deloitte LLP, Ernst & Young LLP, Grant Thornton UK LLP and PricewaterhouseCoopers LLP had improved from the year before but still fell below expectations, with about 80% of audits assessed as good or requiring only limited improvements.
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Shoppers in Cologne, Germany. Surveys of businesses from across Europe recorded the strongest increase in activity for more than two decades. PHOTO: YING TANG/ZUMA PRESS
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Parts of the global economy are expected to surge over the coming months and start to catch up with the U.S. and China, though the Delta variant of Covid-19 looms as a potential headwind, according to surveys of purchasing managers.
The U.S., which saw red-hot growth in the second quarter, is meanwhile expected to see growth ease amid continued supply constraints, a shortage of available workers and the spread of the new Delta variant, the IHS Markit survey of U.S. businesses said on Friday.
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General Motors Co. is recalling its all-electric Chevrolet Bolt for a second time because of a potential battery defect that can cause a fire, underscoring the technical challenges car companies face as they race to develop more plug-in vehicles.
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Concerns about a Chinese government crackdown on after-school tutoring hammered shares in Chinese education stocks. Shares in New Oriental Education & Technology Group Inc. and rival TAL Education Group traded about 54% and 71% lower, respectively, in New York on Friday.
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China is calling on private-sector pioneers Ant Group Co. and Tencent Holdings Ltd. to help it develop a state-backed digital currency that threatens the pair’s highly popular payment networks.
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Researchers proposed that bankruptcy judges should regard independent directors as truly neutral ‘only if all creditors support their appointment, making them accountable to all sides of bankruptcy disputes.’ PHOTO: JOHN NACION/ZUMA PRESS
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Companies on the brink of insolvency are increasingly appointing independent directors to their boards as they prepare for a bankruptcy filing, but their neutrality is disputed by creditors, lawyers and academics.
The companies label these directors as disinterested experts who act to maximize value for creditors by investigating the reasons for the bankruptcy, dealings between the company and its owner, and other matters. The directors’ input carries significant weight with bankruptcy judges, who tend to defer to their findings that a particular settlement or transaction is fair, years of court rulings show.
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BNSF’s Logistics Park in Chicago. The railroad recently began metering freight from the West Coast to the hub for two weeks, a tactic it typically only undertakes after disruptions like extreme weather events. PHOTO: TANNEN MAURY/SHUTTERSTOCK
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Chicago is emerging as a new bottleneck in the global supply chain as rail, trucking and logistics operators struggle with a glut of imports from Asia reaching the Midwestern freight hub.
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Meanwhile, schools are struggling to secure food for student breakfasts and lunches ahead of classrooms’ planned reopening in the fall.
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The surge in Covid-19 cases is giving some companies and workers pause over looming return-to-office plans, even as a number of employers push ahead and reopen workplaces.
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