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The Morning Risk Report: Equifax to Pay About $700 Million to Resolve Data-Breach Probes
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CEO Mark Begor testifies in Congress on March 7. He has said the company has sought to help consumers fix errors on their credit reports since the breach. PHOTO: AL DRAGO/BLOOMBERG NEWS
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Good morning. Equifax Inc. is nearing a deal to settle a slew of state and federal investigations into a 2017 data breach that exposed nearly 150 million Americans’ Social Security numbers and other sensitive personal information.
Under the agreement, the credit-reporting firm would pay around $700 million to settle with the Federal Trade Commission, the Consumer Financial Protection Bureau and most state attorneys general, according to people familiar with the matter. The deal would also resolve a nationwide consumer class-action lawsuit, they said. The settlement could be announced as soon as Monday, the people said.
[Continued below...]
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The deal would clear a cloud that has hung over Equifax since it revealed in September 2017 that hackers had penetrated its systems and gained access to consumers’ names, Social Security numbers, birth dates and addresses. The settlement would establish a fund to compensate consumers for harm suffered because of the breach, according to people familiar with the matter. A website and call center would be set up to handle the claims, one of the people said.
The settlement would also require Equifax to make additional changes to how it handles and protects consumer data, the people said. The company is on track to spend some $1.25 billion shoring up its security systems and upgrading technology. Regulators in several states last year ordered the company to strengthen its information-security defenses, patches and disaster-response protocols.
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U.S. Blacklists Venezuelan Intelligence Agency Officials
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The U.S. imposed sanctions on four officials in Venezuela’s military counterintelligence agency, following the death of a Venezuelan naval officer in June, the Treasury Department said Friday.
The designations follow the blacklisting of the agency, the General Directorate of Military Counterintelligence, which the Treasury has accused of systematic human rights abuses and suppressing dissent. The four officials include the agency’s deputy director, its director of investigations and the head of its special affairs unit.
The U.S. Treasury said the Venezuelan military counterintelligence service detained Capt. Rafael Acosta Arévalo last month, alleging that the Venezuelan naval officer was involved in a plot to assassinate Venezuelan President Nicolás Maduro, whose government the Trump administration says is illegitimate and corrupt. Mr. Acosta died last month after showing signs of physical abuse at a hearing seven days after his arrest, according to the Treasury.
–Mengqi Sun
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From Risk & Compliance Journal
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Basil al Jarah pleaded guilty to conspiring to pay bribes, according to the U.K.’s Serious Fraud Office. PHOTO: DANIEL LEAL-OLIVAS/AGENCE FRANCE-PRESSE/GETTY IMAGES
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A former partner of Unaoil Group in Iraq has pleaded guilty to conspiracy charges brought in connection with an investigation by the U.K. Serious Fraud Office into the oil-services firm, Risk & Compliance Journal’s Dylan Tokar reports. Basil al Jarah pleaded guilty to conspiring to pay bribes to secure contracts to supply and install moorings and oil pipelines in southern Iraq, the SFO said Friday, after a court order restricting reporting on Mr. al Jarah’s plea was lifted.
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The Securities and Exchange Commission charged three former executives at a Chicago engine manufacturer with allegedly overstating the company’s revenue by almost $25 million, Risk & Compliance Journal’s Kristin Broughton reports. Prosecutors charged three former executives at Power Solutions International Inc. with violating internal control, antifraud and various other provisions of U.S. securities law. All three men played a role in falsely recording revenue for incomplete sales so that the company could meet analysts’ expectations, and then concealing information from the company’s auditors, the SEC said Friday.
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A helicopter takes off from the flight deck of the amphibious assault ship USS Boxer during its transit through Strait of Hormuz on Thursday. PHOTO: HANDOUT/REUTERS
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Ships plying the Strait of Hormuz are getting caught in the middle as Iran pushes back against U.S. sanctions and maneuvers around a more muscular American regional presence, raising the risk of direct military confrontation. A British-flagged oil tanker Iran seized on Friday became the latest casualty of an Iranian response to perceived aggression that stops short of full conflict. The Iranian seizure came a day after the U.S. Navy said it had shot down an Iranian drone over the Persian Gulf—which Iran denied—and involved Revolutionary Guard forces rappelling onto the deck from a helicopter.
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Secretary of State Mike Pompeo warned at a conference in Buenos Aires of a regional terrorism threat, singling out the militant Hezbollah group as a concern and announcing U.S. sanctions against an operative charged with coordinating a 1994 bombing in Argentina.
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Johnson & Johnson, still facing thousands of lawsuits over the safety of its signature baby powder after losing several trials, will make a high-stakes attempt to head off future losses in a courtroom battle beginning Monday.
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Ford Motor Co.'s multibillion-dollar push to expand in China this decade has veered off course, leaving it mired in a sales slump that is weighing on its future in the world’s largest auto market. The No. 2 Detroit auto maker’s sales in China fell 27% in the first six months of 2019 from the prior-year period, as a downturn in the Chinese car market extended to a 12th month in June.
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Egypt is braced for fresh economic fallout from a British Airways decision to suspend flights to Cairo for a week due to security concerns.
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State laws expanding the statute of limitations for child sexual-abuse claims pose a growing financial risk to insurance companies, said ratings firm A.M. Best.
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Lawyer Eugene Scalia at his offices in Washington in 2012. PHOTO: STEPHEN VOSS FOR THE WALL STREET JOURNAL
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In Eugene Scalia, the Trump administration has found a potential secretary of labor with an established record of pursuing limits on government regulation of business. Mr. Trump on Thursday said he intends to nominate Mr. Scalia, the son of the late Supreme Court Justice Antonin Scalia, to the post. If he is confirmed by the Senate, he could move quickly on a number of significant rules under consideration by the Labor Department.
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President Trump plans to meet with a group of senators at the White House this week to discuss possible sanctions against Turkey as pressure mounts from lawmakers to punish Ankara for its recent purchase of a Russian missile-defense system.
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Bumble Bee Foods LLC has hired turnaround firm AlixPartners LLP as the seafood purveyor seeks to recover after pleading guilty to fixing prices on canned tuna, according to people familiar with the matter.
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The National Security Agency suffered a historic theft of data by contractor Harold Martin III, who was sentenced to 9 years in prison on Friday. PHOTO: PATRICK SEMANSKY/ASSOCIATED PRESS
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A former National Security Agency contractor was sentenced to nine years in prison after pleading guilty earlier this year to removing classified information from the spy agency, in what is widely viewed as one of the largest thefts of U.S. government secrets in history.
Harold “Hal” Martin III, who was indicted in 2017 and accused of taking home thousands of pages of documents containing some of the nation’s most sensitive secrets over a span of several years, pleaded guilty in March to a single count of willful retention of national defense information. Prosecutors at the time agreed to recommend dropping 19 other counts of the same charge, and a plea deal recommended a nine-year sentence.
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The dispute centers on how much AT&T is willing to pay CBS for the right to show its channels on its satellite and cable-TV packages. PHOTO: PATRICK T. FALLON/BLOOMBERG NEWS
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Programming from CBS Corp. went dark for about 6.6 million viewers of AT&T’s DirecTV, DirecTV Now and U-verse packages Saturday morning after the two companies couldn’t come to terms on a new distribution agreement.
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Restaurants are sweetening pay packages and adding perks like more scheduling flexibility to attract and retain workers in the tightest job market in decades. Waiting tables and operating deep-fryers has long been some of the lowest-paid work in the U.S., and a rite of passage for students during the summer. This year, with unemployment at the lowest level in decades, restaurants are finding fewer students and lower-skilled workers willing to take those jobs.
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Walmart Inc. ’s finance executives are undergoing a shuffling as the world’s biggest retailer absorbs Jet.com into the company’s digital operation. The Bentonville, Ark., company said in an internal memo that it would merge the U.S. e-commerce finance group into the greater U.S. finance team.
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Carl Icahn wants changes made to Occidental Petroleum’s bylaws. PHOTO: BRENDAN MCDERMID/REUTERS
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Billionaire investor Carl Icahn has taken another step in his effort to replace four directors at Occidental Petroleum Corp., alleging the company’s board mismanaged its $38 billion deal to buy Anadarko Petroleum Corp.
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PG&E Corp. and certain shareholders are fighting back against a restructuring strategy by Elliott Management Corp. and other bondholders that would hand them nearly full control of the utility when it exits bankruptcy.
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https://www.wsj.com/articles/pepsi-expands-in-africa-with-1-7-billion-deal-11563530797
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PepsiCo Inc. has agreed to buy South Africa’s Pioneer Foods Group Ltd. for $1.7 billion, as the snack-and-beverage giant looks to build up its business in sub-Saharan Africa.
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Facing stagnant sales of household mainstays from diapers to detergent, the world’s biggest consumer-products companies are trying to crack the lucrative market for influencer-pitched, millennial-approved skin-care products. Household-goods makers such as Procter & Gamble Co., Colgate-Palmolive Co. and Unilever PLC have begun snapping up skin-care startups selling pricey creams, serums and lotions—long the domain of beauty companies—while relying on Instagram and Sephora, a U.S. beauty chain, to drive sales instead of drugstores and shopping malls.
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