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The Morning Risk Report: U.K.’s Serious Fraud Office Charges Former Executives of G4S Subsidiary
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Three former executives of a subsidiary of security-services company G4S face fraud charges in the U.K. PHOTO: GARETH FULLER/PA WIRE/ZUMA PRESS
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Good morning. The U.K.’s Serious Fraud Office filed fraud charges against three former executives of a subsidiary of security-services company G4S PLC. The former executives of G4S Care and Justice Services (UK) Ltd. made false representations to the U.K.’s Ministry of Justice in a multiyear scheme to defraud the agency, according to the SFO, the U.K.’s prosecuting agency for major economic crimes.
The charges come after G4S Care and Justice Services in July reached a deferred prosecution agreement with the SFO to resolve allegations that it misled the Ministry of Justice about the profits the company derived from contracts with the agency for electronic monitoring services.
[Continued below…]
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The SFO’s recent use of deferred prosecution agreements—a voluntary settlement under which prosecutors agree not to prosecute a company if it fulfills certain requirements—has come under scrutiny, Risk & Compliance Journal’s Dylan Tokar reports. Several companies, including British grocery chain Tesco Stores Ltd., have reached deferred prosecution agreements with the SFO to resolve allegations of wrongdoing by former employees who were later acquitted.
The agreement with G4S Care and Justice Services resolved the company’s liability; it doesn’t indicate whether any employee or former employee of the subsidiary is also liable, according to an order attached to the settlement.
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We’re conducting a survey of compliance professionals about the impact of the Covid-19 pandemic on their work, and we’ll present findings at the WSJ Risk & Compliance Forum on Oct. 8. If you work in compliance, we’d love to hear from you via this survey link. Responses will be kept anonymous. To request an invitation to the event, click here.
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Pactiv Discloses Potential Anti-Corrupt Violations in IPO Filing
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Packaging maker Pactiv Evergreen Inc. said it identified practices in a China unit that may have violated U.S. anti-bribery laws.
Pactiv’s amended prospectus, filed Tuesday, said the company identified the potential violations last month and reported them to the U.S. Justice Department and the U.S. Securities and Exchange Commission. The company said its Evergreen Packaging Shanghai business occasionally gave gift cards of “relatively minor monetary values” to Chinese regulators or employees of state-owned companies over several years.
The Lake Forest, Ill., company, currently known as Reynolds Group Holdings Ltd., said it is investigating the practices. It said the amounts involved aren’t material. The company said it expects to sell 41 million shares between $18 and $21 apiece in its planned initial public offering.
—Mengqi Sun
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JPMorgan Chase delivered $28 billion in loans through the small-business lending program. PHOTO: MARY ALTAFFER/ASSOCIATED PRESS
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JPMorgan Chase has found evidence of employees and customers misusing the government’s flood of stimulus funds this spring and is cooperating with authorities, the bank’s leaders told employees Tuesday.
In a memo to employees, the bank said it had found customer wrongdoing involving the small-business rescue plan known as the Paycheck Protection Program, unemployment benefits and other government programs aimed at easing the coronavirus pandemic’s economic effects. “Some employees have fallen short, too,” the memo said, without elaborating. The memo described the issues as “conduct that does not live up to our business and ethical principles—and may even be illegal.”
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The U.S. blacklisted two former Lebanese government ministers it says have aided Iran-backed Hezbollah and are part of systemic corruption that the U.S. says is contributing to the country’s economic and political crises.
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The Trump administration said the action against Yusuf Finyanus, a former minister of transportation and public works, and Ali Hassan Khalil, a former finance minister, is an effort to help Lebanon use the political backlash from last month’s deadly blast in Beirut to overhaul a government long plagued by corruption. Neither former official responded to requests for comment.
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Apple swung back at Epic Games in a counter-lawsuit accusing the software developer of duplicity and greed, intensifying a legal battle over the iPhone maker’s online software store that could reshape how the marketplace operates.
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Boeing said it had identified a third quality-control lapse in production of its 787 Dreamliner, further slowing deliveries of the jetliner and revving up an investigation by the federal air-safety regulator.
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The House Oversight Committee is launching an investigation into Postmaster General Louis DeJoy following published allegations that he reimbursed employees of the logistics company he ran after they made campaign contributions to Republican politicians, a practice barred by federal election law.
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A McDonald’s restaurant in Chicago. The company is defending itself against discrimination allegations filed in a federal court in Illinois. PHOTO: JOSHUA LOTT/BLOOMBERG NEWS
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The number of Black officers in the uppermost ranks of McDonald’s U.S. business fell to six this year from 42 in 2014, according to company figures and those cited in a lawsuit.
The burger giant says it has begun to assess diversity across its ranks, and is trying new initiatives, such as creating diverse panels of employees to evaluate candidates for officer-level jobs. It has also restored funding for its African-American employee council, along with other internal diversity networks, after a dropoff in support. The company said it would report on its diversity goals annually.
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The companies said ‘the safety and well-being of vaccinated individuals’ would always be their top priority. PHOTO: HENRY FORD HEALTH SYSTEM/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Nine drugmakers said their chief executives signed a pledge promising to not file for regulatory approval or authorization of their experimental Covid-19 vaccines until the shots have shown to work safely through late-stage clinical testing. They promise to keep following scientific and ethical standards in clinical trials testing the Covid-19 shots, and in manufacturing. They also pledge to ensure supply across the world.
Meanwhile, AstraZeneca said it paused clinical trials of an experimental Covid-19 vaccine after a participant in a U.K. study had an unexplained illness.
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Power shut-offs like the one that darkened parts of California this week are expected to be a regular occurrence in the state for years during wildfire season as PG&E upgrades its aging equipment and completes overdue repairs.
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California utilities in recent years have resorted to so-called public safety power shut-offs in which they cut off electricity to certain areas to reduce the risk of their power lines sparking wildfires when wind speeds pick up.
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