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The Morning Risk Report: Boeing Seeks Blessing to Deliver 737 MAX as FAA Reviews Pilot Training
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Boeing is running low on parking spots for the 737 MAX as finished planes pile up. Here, an employee works on 737 MAX planes at a Washington factory. PHOTO: JASON REDMOND/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Good morning. Boeing hopes to deliver 737 MAX aircraft to airlines before the end of the year even if regulators haven’t approved related pilot training, people familiar with the matter said.
As the plane maker prepares for the Federal Aviation Administration to lift a MAX flight ban as soon as December, Boeing is discussing with regulators whether it can deliver the aircraft before airline pilots have undergone required training needed to fly the jet, these people said. The emerging plan comes amid increasing signs there will be lag between an FAA’s lifting of a flight ban and its approval of new training for pilots.
[Continued below...]
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Delivering aircraft before all the regulatory approvals are complete would relieve pressure on the manufacturer as it contemplates further cutting or halting MAX production amid the protracted grounding. It would also help airlines that have lost hundreds of millions of dollars and disrupted passengers’ travel plans. Under the plan, airlines still wouldn’t fly the plane with passengers until the training occurs.
“Subject to strict regulatory approval, we continue to complete key milestones that put us on a path to certification of the MAX in December, with training approved in January, paving the way for the safe return of the MAX to commercial service,” a Boeing spokesman said.
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Corporate Compliance in a Disrupted World
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Digital disruption, shifting workplace norms and the rapidly changing state of world affairs have added new dimensions to corporate compliance. Join The Wall Street Journal in New York on Nov. 19 for a live discussion with chief compliance officers from leading companies about how their focus is changing. For details and to register, click here.
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From Risk & Compliance Journal
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Lawrence Hoskins, a former executive at France-based train maker Alstom, was found guilty of violating a 1977 U.S. law that prohibits bribing foreign government officials. PHOTO: HAUKE-CHRISTIAN DITTRICH/AGENCE FRANCE-PRESSE/GETTY IMAGES
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A jury found a former Alstom SA executive guilty of helping orchestrate a bribery scheme in Indonesia, a verdict that reinforces the reach of a U.S. law prohibiting bribes to foreign government officials, the Risk & Compliance Journal's Dylan Tokar reports.
Lawrence Hoskins, a former senior vice president at the France-based train maker, was found guilty Friday of various counts of violating the U.S. Foreign Corrupt Practices Act, as well as of money laundering and conspiracy charges.
Jurors at the U.S. District Court for the District of Connecticut deliberated for one day before reaching the verdict. They acquitted Mr. Hoskins of a single count of money laundering, which related to an $80,000 transfer that prosecutors alleged a consultant had made to a bank account in Indonesia for the purpose of bribing a government official there. Sentencing is scheduled for Jan. 31.
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Banca Monte dei Paschi di Siena’s ex-chairman Giuseppe Mussari was given the longest jail sentence of those convicted Friday, seven years and six months. PHOTO: ALESSIA PIERDOMENICO/BLOOMBERG NEWS
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A Milan court convicted 13 former and current executives of Banca Monte dei Paschi di Siena SpA, Deutsche Bank and Nomura International of a number financial crimes, in a long-running judicial saga tied to losses at the troubled Italian bank.
The court gave the bankers suspended jail sentences of up to seven years and six months each, according to a court document seen by The Wall Street Journal.
The court also ordered the seizure of about €65 million ($71 million) from Deutsche Bank and €88 million from Nomura plus a €3 million fine for Deutsche Bank and €3.5 million for Nomura.
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Funds with a focus on socially responsible investing are enjoying a record year of inflows. But many such portfolios aren’t as clean as investors might expect. Eight of the 10 biggest U.S. sustainable funds are invested in oil-and-gas companies, which are regularly slammed by environmental activists, according to a review of the funds’ public disclosures.
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In August 2018, a service member at a U.S. Air Force base noticed something unusual about a new body camera there: Chinese characters appeared on its built-in screen, including what turned out to be the logo for China’s domestic-security agency. The discovery, detailed in a criminal complaint unsealed in federal court last week, was one clue that led investigators to a scheme by a Long Island company to import surveillance and security equipment from Chinese manufacturers for resale as purportedly American-made goods.
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President Trump is supporting a move to raise the minimum purchase age for e-cigarettes nationwide to 21 from 18 in an effort aimed at curbing teenage vaping. Meanwhile, vitamin E oil was detected in all 29 samples taken from vaping patients tested by the Centers for Disease Control and Prevention, the federal agency said Friday, a tantalizing clue in the investigation into the cause of the mysterious lung injuries.
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Embattled Bolivian President Evo Morales fled the capital La Paz and resigned after the head of the armed forces, Gen. Williams Kaliman, suggested that he leave power in the wake of an Oct. 20 presidential vote that electoral monitors said was marred by fraud.
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WeWork was scrambling to reassure regulators at the SEC about its financial reporting just weeks before its planned IPO; a WeWork co-working space in Brooklyn. PHOTO: SPENCER PLATT/GETTY IMAGES
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Just weeks before WeWork expected its stock to begin trading publicly, the startup was still wrangling with the Securities and Exchange Commission over a controversial key financial metric and a litany of other concerns about its planned multibillion-dollar IPO.
On Sept. 11—after the initial public offering prospectus had been public for nearly a month, and after the SEC had already made dozens of demands about the document—the regulator sent the shared-workspace company a list of 13 still-unresolved concerns, according to previously unpublished correspondence reviewed by The Wall Street Journal.
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Lael Brainard said rising insurance premiums and increased spending on climate-change adaptations ‘will have implications for economic activity and inflation.’ PHOTO: TAYLOR GLASCOCK/BLOOMBERG NEWS
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Federal Reserve governor Lael Brainard said the central bank is ramping up its efforts to understand the implications of climate change for monetary policy and noted that the phenomenon may have consequences for interest rates.
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Farmers are increasingly leaning on alternative lenders to make it through the steepest agricultural downturn in a generation. With crop prices stuck at low levels, traditional farm banks are placing stricter terms on farm loans and doling out less money, leaving cash-strapped farmers to seek capital from more lightly regulated entities.
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Aramco revealed a steep drop in profit related to attacks on its facilities in September that briefly halved the Saudi company’s oil output, highlighting the risks to investors ahead of what could be the world’s largest initial public offering.
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FRANCESCO CICCOLELL
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The Trump administration in recent months has warned about supply-chain risks that could make next-generation wireless networks vulnerable to spying or disruptive attacks, and has tried to pressure U.S. allies from using equipment manufactured by Chinese telecom giant Huawei Technologies. Those concerns are valid, cybersecurity experts say.
But they also say that 5G—which is expected to be 100 times faster than 4G networks and could enable new technologies such as self-driving cars and remote surgery—will have new features that will make it easier for companies to identify cyber threats, authenticate users and segment their networks to prevent an attack from quickly spreading throughout an organization.
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Consumption of alcohol in India is soaring, despite societal disapproval of drinking. A bartender at a pub in Sector 29 of Gurgaon Haryana, India. PHOTO: NASIR KACHROO/NURPHOTO/GETTY IMAGES
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Johnnie Walker-maker Diageo is betting on India, the world’s largest whiskey market, to power its growth. But first, it has to win over dozens of local governments that want to either ban liquor or tax it heavily, even as more Indians embrace drinking.
To protect sales, Diageo is helping a number of Indian states develop tax policy. To demonstrate that it is a responsible actor, it is rolling out road-safety programs. Diageo is even presenting ways that states can move up India’s ease-of-doing-business rankings—which are important for attracting investment—by cutting red tape for alcohol.
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Bernard Tyson, chief executive officer at Kaiser Permanente, died Sunday. PHOTO: ANDREW DAVIS FOR THE WALL STREET JOURNAL
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Kaiser Permanente Chief Executive Bernard Tyson, a high-profile voice in U.S. health policy, died unexpectedly Sunday. Mr. Tyson was 60 years old and had served as CEO of the Oakland, Calif.-based nonprofit hospital system and health insurer since 2013. Kaiser named Gregory Adams, an executive vice president and group president, as interim chief executive and chairman.
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Viacom and CBS are realigning the leadership of their creative operations in advance of the expected closing of their merger in early December, people familiar with the matter said. The restructuring will result in consolidation among the cable programming and digital operations of the two companies. Viacom and CBS have already detailed combinations of their advertising sales and content distribution units.
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