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The Morning Risk Report: Election Tests Companies’ Policies on Social Media, Political Speech
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Unrest stoked by the pandemic and an election has presented challenges for compliance executives. Activists during a protest in Portland, Ore., this month. PHOTO: NATHAN HOWARD/GETTY IMAGES
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The political rancor of the coming U.S. presidential election is putting pressure on companies and their compliance officers to engage proactively with employees on ethical behavior and social-media use.
Corporate codes of conduct and social-media policies are hardly a cure-all for the challenges posed by the increasing polarization of political views among Americans, but with companies increasingly sensitive to reputational risks, experts say it would behoove corporate leaders to remind employees of their existence before an issue arises.
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Clifford Rossi, an expert on risk management and a professor at the Robert H. Smith School of Business at the University of Maryland, said the consequences for not doing so are increasingly severe.
“Awareness and sensitivity is really what this is about,” Mr. Rossi said. “That’s how you manage this risk: Make people more aware of their actions and the consequences.”
The task today falls at least partly on the shoulders of corporate compliance officers.
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From Risk & Compliance Journal
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CFTC to Offer Lower Fines to Offenders That Cooperate
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The U.S. derivatives watchdog is planning to offer rewards to companies that turn themselves in, following in the footsteps of other regulators and law-enforcement agencies.
The Commodity Futures and Trading Commission is expected to release guidance Thursday spelling out how companies that self-report potential misconduct, cooperate with investigators and take steps to address underlying issues could receive a “substantially reduced” financial penalty.
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Former Transportation Executive Sentenced to Four Years in Prison
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The former president of a Maryland transportation company was sentenced to four years in federal prison for participating in a scheme to bribe an official at a unit of a Russian nuclear-energy company.
Mark Lambert, 57 years old, was sentenced by a federal judge in Greenbelt, Md., on Wednesday. He also was ordered to serve three years of supervised release and pay a $20,000 fine.
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An Apple store in Paris; the Interactive Advertising Bureau France and others have filed a complaint against Apple. PHOTO: GONZALO FUENTES/REUTERS
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Advertising companies and publishers have filed a complaint against Apple with France’s competition authority, arguing that privacy changes the smartphone maker plans to roll out are anticompetitive. Starting in early 2021, Apple’s operating software will require apps to get opt-in permission from users to collect their advertising identifier, a key number used to deliver targeted ads and check how ad campaigns performed.
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A federal appeals court Wednesday refused to reconsider its decision earlier this year to throw out a government antitrust case against Qualcomm. The Federal Trade Commission had alleged the dominant cellphone chip maker engaged in illegal monopolization, but a three-judge panel on the Ninth U.S. Circuit Court of Appeals ruled in August that the government hadn’t proven its case.
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The Securities and Exchange Commission on Wednesday shelved a measure intended to protect investors who trade the shares of a class of exchange-traded funds it considers risky, saying it would review the issue later. The SEC in November had proposed requiring broker-dealers and investment advisers to vet individual investors before approving them to trade the products, known as leveraged and inverse exchange-traded funds.
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The state of Iowa’s decision earlier this year to use $21 million in federal Covid-19 aid to pay for information-technology software has drawn the attention of the U.S. Treasury Department as well government IT experts.
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Shareholders of Russia’s Vostochny Bank came to a multimillion-dollar settlement Wednesday to resolve a corporate dispute at the heart of a criminal case against a U.S. businessman, whose arrest last year on fraud charges shook foreign investors’ confidence in doing business in Russia.
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Twitter CEO Jack Dorsey, Alphabet CEO Sundar Pichai and Facebook CEO Mark Zuckerberg faced a Senate committee on Wednesday on their companies’ role in shaping political discourse.
PHOTO: JIM LO SCALZO/EPA/SHUTTERSTOCK; JEFF CHIU/ASSOCIATED PRESS; NICK WASS/ASSOCIATED PRESS
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Chiefs of the largest social-media companies tangled with U.S. senators over their role in public discourse amid a contentious election that has stoked bipartisan criticism of the companies’ policies.
Facebook Chief Executive Mark Zuckerberg; Twitter CEO Jack Dorsey; and Sundar Pichai, CEO of Google and YouTube owner Alphabet, have spent the years since the 2016 election rewriting their policies and taking a more active role in moderating online speech—in part to avoid a spotlight like the one placed on them Wednesday.
Instead, the Senate Commerce Committee hearing reflected deep discontent with social-media platforms’ power and equally deep divisions about how to address it.
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U.S. states are facing their biggest cash crisis since the Great Depression. Nationwide, the U.S. state budget shortfall from 2020 through 2022 could amount to about $434 billion, according to data from Moody’s Analytics, the economic analysis arm of Moody’s.
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House Speaker Nancy Pelosi said Wednesday the coronavirus relief plan she has been discussing with the White House could morph in the lame-duck session of Congress, absent any formal agreement on its details and shifting incentives for both parties after the election.
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The ECB said a software glitch in a third-party network device was responsible for a nearly 11-hour technical disruption. PHOTO: BLOOMBERG NEWS
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The European Central Bank blamed a software defect for a disruption to the region’s main wholesale payment system last week that left banks unable to process transactions and securities trades for almost 11 hours.
The outage Friday paralyzed the ECB’s Target2 payments system, which provides the plumbing that allows money to flow across the area’s single market. Owned and operated by the region’s central banks, it processes around €2 trillion in transactions a day, equivalent to $2.35 trillion and to around a fifth of the eurozone’s annual economic output.
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Ride-share driver Tyra Johnson-Morris scouts in her car in Chicago. PHOTO: TAYLOR GLASCOCK FOR THE WALL STREET JOURNAL
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Uber Technologies, Lyft and DoorDash are spending tens of millions of dollars and flooding voters with messages in a neck-and-neck battle to preserve their current business model in California.
The companies, along with other gig-economy giants like Postmates and Instacart, have contributed nearly $200 million to persuade voters to approve a ballot measure that would exempt them from a new state law requiring businesses to reclassify contract workers as employees. That amount, the most ever raised for a California ballot question, according to Ballotpedia, suggests how pivotal the vote will be for companies reliant on a labor model in which workers are summoned at the touch of an app.
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Protesters outside Lloyd’s of London during an Extinction Rebellion march on Sept. 4. PHOTO: DAVE RUSHEN/SOPA IMAGES/LIGHTROCKET/GETTY IMAGES
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Lloyd’s of London has launched an internal investigation into its role in the trans-Atlantic slave trade in part to determine whether it is on the hook to pay reparations.
The 332-year-old insurance market is responding to pressure from Black employees and racial-equality campaigners to open up about the slave trade in the 18th and 19th centuries. Lloyd’s Chairman Bruce Carnegie-Brown said he is talking to academic and cultural institutions that can help to investigate its archive.
“We insured cargo vessels and slaves that were the cargoes of those vessels going across the Atlantic to the Caribbean and the East Coast of the United States,” Mr. Carnegie-Brown said. “It’s almost certain that we have a very high share of whatever insurance was bought. We don’t know today how much insurance was bought.”
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Anthony Albanese has led the New York Stock Exchange’s in-house regulatory unit since 2016. PHOTO: JUSTIN LANE/SHUTTERSTOCK
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The New York Stock Exchange’s top markets cop is leaving the Big Board for a job advising venture-capital firm Andreessen Horowitz on cryptocurrency regulation.
Anthony Albanese, who has led the NYSE’s in-house regulatory unit since 2016, will join the Silicon Valley firm as its chief regulatory officer in mid-November, a spokeswoman for Andreessen Horowitz said.
The move makes Mr. Albanese the latest regulator to join a firm active in digital-currency markets, where regulations are still emerging and many businesses operate in a legal gray area. His work will involve outreach to regulators and helping to shape strategy for Andreessen Horowitz’s cryptocurrency projects, according to a blog post that the firm released Wednesday.
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