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The Morning Risk Report: Fast-Tracked Aircraft Certification Comes Under the Spotlight
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Boeing 737 MAX airplanes are parked at the company’s plant in Renton, Wash., on Thursday. PHOTO: LINDSEY WASSON/REUTERS
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Good morning. The safety-certification process that put the Boeing 737 MAX in the air is coming under congressional scrutiny in what is shaping up as a test of the aircraft maker’s influence in Washington.
Boeing Co. and its lobbyists for years pushed to speed up the time it takes to get a new plane certified to fly. Congress and the Federal Aviation Administration—which were both targets of the company’s multimillion-dollar lobbying—supported efforts to delegate some safety-certification functions to Boeing.
[Continued below…]
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Following the two fatal crashes of Boeing 737 MAX airplanes in Indonesia and Ethiopia, lawmakers are questioning whether a new automated anti-stall system in the aircraft was properly vetted.
Several lawmakers are zeroing in on the Organization Designation Authorization program, established by the FAA in 2005, that allows certain aspects of safety certification to be delegated by the FAA to a plane maker. That program “left the fox guarding the henhouse,” Sen. Richard Blumenthal (D., Conn) wrote in a letter sent to acting FAA Administrator Daniel Elwell on Friday.
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From Risk & Compliance Journal
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Swedbank CEO Birgitte Bonnesen says local bank secrecy laws have hindered the bank’s ability to make its case to the public PHOTO: KARIN TÖRNBLOM / IBL BILDBYR/ZUMA PRESS
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Swedbank AB has cut ties with an undisclosed number of customers who are at the center of money-laundering allegations against the Stockholm-based lender, according to a third-party audit published Friday. The Swedish bank commissioned the audit last month following a report by Swedish television station SVT that said 50 customers with ties to a $230 billion Danske Bank A/S money-laundering scandal moved billions of dollars through Swedbank between 2007 and 2015.
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President Trump speaking at the White House on Thursday. PHOTO: JOSHUA ROBERTS/REUTERS
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The conclusion of special counsel Robert Mueller’s Russia investigation leaves in its wake about a dozen other probes into President Trump and his associates by an array of federal, state and congressional investigators. Among them: the Manhattan U.S. attorney’s office continues to investigate matters related to the hush-money payments to women that former Trump lawyer Michael Cohen arranged during the 2016 campaign, according to a court filing in February.
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President Trump’s move to reverse economic sanctions on North Korea surprised U.S. officials who had described the Treasury Department’s actions as modest but necessary steps to enforce existing sanctions against Pyongyang. Mr. Trump said Friday he was reversing Treasury’s decision a day earlier to tighten sanctions on North Korea by listing two Chinese shipping companies as sanctions violators.
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Regulators who sued Tesla Inc. Chief Executive Elon Musk last year for allegedly misleading investors with his tweets wanted the company to preapprove anything the executive said publicly about the auto maker. Mr. Musk didn’t agree to the condition, saying his ability to freely talk about the company and its products was crucial to Tesla’s success, according to new details in a filing that Mr. Musk’s legal team submitted Friday in Manhattan federal court.
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Nokia Corp. warned it could face penalties for compliance issues, prompting its shares to fall and adding another challenge as it struggles to compete with China’s Huawei Technologies Co. The Finnish telecom-equipment manufacturer first disclosed the issue in its annual report filed with the U.S. Securities and Exchange Commission.
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The Future of Corporate Compliance
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Join The Wall Street Journal and Dow Jones Risk & Compliance in Houston on April 11 for an interview with Stratfor’s vice president of global analysis, Reva Goujon, on how world events are creating corporate risk, followed by a panel discussion on energy company compliance with Christine Stevenson, chief compliance officer for integrated supply and trading at BP Americas and Brent Benoit, chief compliance officer of National Oilwell Varco. Register here.
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Marijuana use has generated millions of dollars in additional tax revenue for states that have legalized its use. PHOTO: M. SCOTT BRAUER FOR THE WALL STREET JOURNAL
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Companies facing a shortage of employees from health-care workers to forklift operators are confronting a new challenge: finding candidates who can pass drug tests in states that have legalized marijuana. Marijuana use has generated millions of dollars in additional tax revenue for states that have legalized its use. But job applicants in those states are also flunking drug tests at higher rates than the national average, according to Quest Diagnostics Inc., a major drug-screening provider.
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The owner of a Chinese chemical plant that exploded this week, killing dozens of people and injuring hundreds, has a record of safety and environmental lapses, underscoring the nation’s challenge in improving industrial safety after a string of disasters in recent years.
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FEMA’s inspector general said officials accidentally released personal information to a contractor. PHOTO: CARLOS GIUSTI/ASSOCIATED PRESS
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Federal emergency officials inadvertently released personal information of more than 2 million disaster victims in what a government watchdog called a “major privacy incident,” according to a recent report. The Federal Emergency Management Agency’s inspector general said officials accidentally released personal information to a contractor. It included Social Security numbers and banking information of about 2.3 million survivors of hurricanes Harvey, Maria and Irma, as well as the California wildfires in 2017, leaving them exposed to identity theft and fraud.
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Shares of Avon Products fell more than 10% following its latest earnings release last month. PHOTO: ALAN DIAZ/ASSOCIATED PRESS
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Three years after splitting itself apart, Avon Products Inc. has been considering a deal that would put the company back together, according to a person familiar with the matter. Amid continuing sales struggles, directors of the cosmetics company have discussed a sale to Brazilian rival Natura & Co., the person said.
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The fate of Deutsche Bank AG’s global investment bank, including its embattled U.S. operations, has emerged as a focus of debate following the first week of formal merger talks with Commerzbank AG, according to people familiar with the matter.
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Eli Lilly & Co., facing mounting scrutiny in the U.S. Congress over big increases in the list price of a widely used insulin, says the price it was paid dropped by 8.1% during the previous five years after accounting for rebates and discounts.
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BlackRock Inc. said it has entered into an exclusive agreement to buy French software firm eFront, a move by the world’s largest money manager to become a bigger provider of the technology used by Wall Street. The offer from the New York firm is to pay $1.3 billion in cash for 100% equity in eFront. The software company provides reporting on private equity and alternatives for financial institutions, tracking everything from fees to deals to fundraising.
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One of Newmont Mining Corp.’s largest investors wants the terms of the Denver-based company’s merger with Goldcorp Inc. renegotiated, in a potential setback for a deal that would create the world’s largest gold miner. Joe Foster, who runs the VanEck International Investors Gold Fund, said Friday that the company’s $10 billion merger with Goldcorp transfers away significant gains from a recently announced Nevada joint venture with Barrick Gold Corp.
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Thermo Fisher Scientific Inc. said it is buying Brammer Bio for $1.7 billion in a move that would expand the lab-equipment company’s presence in the rapidly growing field of gene therapy.
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Former Enron CEO Jeffrey Skilling, center, arriving at the federal courthouse in Houston in 2006 for his sentencing hearing. PHOTO: ASSOCIATED PRESS
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Former Enron Corp. Chief Executive and convicted felon Jeffrey Skilling is looking to get back into the energy business, with a little help from his friends. Just weeks after serving more than 12 years in federal custody on fraud, conspiracy and insider-trading convictions following Enron’s fall, Mr. Skilling has been holding meetings with former Enron executives and others, hoping to win backing for a new energy venture, people familiar with the matter said.
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Papa John’s International Inc. added former basketball star Shaquille O’Neal to its board as the pizza chain works to repair its image following controversies tied to its founder and former chief executive. Mr. O’Neal will also participate in Papa John’s marketing efforts and has invested in nine of the chain’s restaurants in the Atlanta area, the company said.
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Discovery Inc. Chief Executive David Zaslav received total compensation valued at $129.4 million in 2018, more than three times his compensation the year before, the company said in a securities filing.
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