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The Morning Risk Report: Leaders of Self-Driving Truck Company Face Espionage Concerns Over China Ties
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Good morning. The Justice Department has been urged by representatives of a U.S. national security panel to consider economic espionage charges against leaders of TuSimple Holdings Inc., an American self-driving truck company with ties to China, according to people familiar with the matter.
The recommendation for criminal charges, made late last year, stemmed from concerns that two founders and the current chief executive of the San Diego-based company were improperly transferring technology to a Chinese startup, the people said. The concerns were based on material gathered as part of a national security review of TuSimple launched earlier last year.
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The background: The Biden administration has ordered a range of steps to try to prevent U.S. technology from advancing China’s military power, and is considering others. The Pentagon has specifically pushed to increase the U.S. military’s use of autonomous vehicles and to counter American adversaries’ technological advances in the field.
The Wall Street Journal reported in October that the Committee on Foreign Investment in the United States, known as Cfius, the Federal Bureau of Investigation and the Securities and Exchange Commission have been investigating whether TuSimple improperly financed and transferred technology to a Chinese startup, citing people with knowledge of the matter. The startup, Hydron Inc., was founded and is run by TuSimple’s controlling shareholder and co-founder, Mo Chen.
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The upshot: Whether the probes are likely to result in any charges couldn’t be determined. TuSimple has said it is unaware of any FBI or SEC investigations. Such investigations can take years.
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Indian industrialist Gautam Adani’s net worth has dropped to an estimated $84.5 billion after a short seller’s report. PHOTO: AMIR COHEN/REUTERS
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Adani scraps share sale after market rout. Indian billionaire Gautam Adani's flagship company reversed course and canceled an up-to-$2.5 billion share sale after its stock tumbled as the conglomerate struggles to contain the fallout from fraud allegations by U.S. short-seller Hindenburg Research.
A day earlier, Adani Enterprises Ltd. said it had collected enough investor bids to pull off the so-called follow-on public offering. But the company’s shares fell more than 25% Wednesday, which would have left investors in the offering with big losses.
Last week, Hindenburg published a scathing report that Mr. Adani had engaged in stock manipulation and malpractices across his companies over decades. The 60-year-old industrialist hasn’t personally addressed the allegations so far, but his conglomerate has criticized the short-seller and its motives and issued a lengthy rebuttal to Hindenburg. Adani Group had said that the report’s publication was timed to scupper Adani Enterprises’ follow-on public offering.
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FTC loses antitrust challenge to Facebook parent Meta. A federal judge declined to halt Meta Platforms Inc.’s acquisition of the virtual-reality startup Within Unlimited, delivering a setback to antitrust enforcers at the Federal Trade Commission seeking to block the deal, a person familiar with the ruling said.
Meanwhile, prescription-drug discount provider GoodRx Holdings Inc. agreed to resolve FTC allegations that it unlawfully disclosed consumers’ personal health information to advertisers, in what the agency said was a first-of-its-kind enforcement action.
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The Biden administration on Wednesday proposed a rule to limit late fees on credit cards, kicking off a regulatory battle with banks that issue the cards.
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Federal labor authorities have cited Amazon.com Inc. for safety violations at three of its warehouses, adding to previous citations the company has faced in a broad review of its workplace practices.
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The European Union’s executive body on Wednesday set out a road map for competing with American green subsidies with a range of tools that could include coordinated tax rebates and the ability to match certain U.S. incentives on a dollar-for-dollar basis.
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Businesses and residents in Hong Kong are dumping their CBD products ahead of a new law starting Wednesday that criminalizes possession of the cannabis derivative, ranking it alongside heroin and cocaine.
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Another prominent Democrat has joined Republicans seeking to hobble TikTok, with Sen. Michael Bennet (D., Colo.) calling on Apple Inc. and Google to bar the Chinese-owned video platform from their app stores.
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A new proposal by the Energy Department could reignite a debate over gas stoves. The department published a proposal Wednesday for new energy-conservation standards for consumer conventional cooking methods, which include gas and electric stoves and ovens.
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Businesses currently classify crypto assets such as bitcoin as indefinite-lived intangible assets, similar to intellectual property such as trademarks.
PHOTO: STEFANI REYNOLDS/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Standards setter floats new rule on crypto accounting. The Financial Accounting Standards Board voted to propose a new rule on cryptocurrency accounting and disclosure, creating new guidance for companies holding these assets and providing more details to investors.
The U.S. has no specific accounting or disclosure rules for crypto assets. The FASB, which sets accounting standards for U.S. public and private companies, on Wednesday said it would issue a proposal that would require businesses to use fair-value accounting for bitcoin and other crypto assets.
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Some Western executives say they have retained ties to Russia to help protect foreign investors and local employees. PHOTO: KONSTANTIN KOKOSHKIN/ZUMA PRESS
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Ukraine denounces Western executives at Russian companies. Ukraine is ratcheting up pressure on Western executives who have retained posts at Russian companies, saying their presence is indirectly supporting Moscow’s war effort.
Many Western executives cut ties with Russia after it invaded Ukraine last year, sometimes in opposition to the war or to comply with Western sanctions. Others remained for various reasons, including saying they had a fiduciary duty to their investors, a responsibility to local employees or yearslong ties to Russia that were hard to break.
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Dangerous fungal infections are on the rise, and a growing body of research suggests warmer temperatures might be a culprit.
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Airfares have eased from last year’s highs. Now a resurgence in jet-fuel prices is threatening to push them higher again.
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European Commission headquarters in Brussels. Country regulators will have to report their progress on major cases to the commission every other month
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EU tightens oversight of data-privacy regulators to speed up decisions. European officials are introducing a new oversight process to monitor major data-privacy investigations following criticism of the glacial pace of enforcement, particularly against multinational tech firms.
Regulators that handle large-scale cases affecting people in more than one European Union country will need to report on their progress every other month to the European Commission, the EU’s executive arm. The commission disclosed the new procedure in response to a complaint alleging that the commission itself had violated EU law by not properly overseeing the Irish privacy regulator.
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As BP appears headed toward a narrower green-energy strategy, a picture of a solar farm hangs in the London office of its solar business. PHOTO: CHRIS RATCLIFFE/BLOOMBERG NEWS
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BP’s CEO plays down renewables push as returns lag. BP PLC Chief Executive Bernard Looney plans to dial back elements of the oil giant’s high-profile push into renewable energy, according to people familiar with recent discussions.
Mr. Looney has said he is disappointed in the returns from some of the oil giant’s renewable investments and plans to pursue a narrower green-energy strategy, the people said. He has told some people close to the company that BP needs to do more to convince shareholders of its strategy to maximize profits in areas where it has a competitive advantage, including its legacy oil-and-gas operations.
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Shareholder activists, newly emboldened by beaten-down share prices, are increasingly crowding into the same big names.
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Intel Corp. Chief Executive Pat Gelsinger and other managers are taking pay cuts, days after the chip maker posted quarterly earnings that disappointed Wall Street and spurred a downgrade in the company’s credit rating.
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Striking workers attend a march in central London. PHOTO: TOBY MELVILLE/REUTERS
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U.K. hit by biggest strikes in a decade. Britain was hit by the largest strikes in a decade on Wednesday as workers from train drivers to teachers to civil servants walked off the job for the day, forcing millions of children to miss school and commuters to stay home.
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Workers in the U.S. are spending more time in the office again, with occupancy rates surpassing 50% for the first time since the start of the Covid-19 pandemic.
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Companies from around the world are moving production and equipment to Mexico as they seek a manufacturing hub closer to the U.S., part of a broader shift in global trade.
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The U.S. reached an agreement that gives it access to four more military bases in the Philippines, broadening Washington’s efforts to counter China’s influence and strengthening an alliance that a few years ago appeared in danger of collapse.
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The European Union will double the number of Ukrainian troops it trains to 30,000, a senior EU official said, in a sign of the bloc’s continued support for Kyiv’s war effort.
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