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The Morning Risk Report: U.S. Approves Nearly All Tech Exports to China, Data Shows
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Good morning. A Commerce Department-led process that reviews U.S. tech exports to China approves almost all requests and has overseen an increase in sales of some particularly important technologies, according to an analysis of trade data.
Of the U.S.’s total $125 billion in exports to China in 2020, officials required a license for less than half a percent, Commerce Department data shows. Of that fraction, the agency approved 94%, or 2,652, applications for technology exports to China, the analysis showed.
[Continued below...]
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Content from our Sponsor: DELOITTE
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For 2021, that approval rate decreased to 88%, the analysis showed, but changes in data compilation methods between the two years make comparisons difficult. The figures omit applications “returned without action,” meaning their outcomes were uncertain.
The result: The U.S. continues to send to China an array of semiconductors, aerospace components, artificial-intelligence technology and other items. Critics say such sales, which have taken place across successive U.S. administrations, could be used to advance Beijing’s military interests.
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WSJ Risk & Compliance Forum
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Sign up for the next WSJ Risk & Compliance Forum on Nov. 16 for discussions on the critical issues facing corporate risk & compliance professionals, including keeping up with sanctions, screening for forced labor, and proposed U.S. rules on climate change and cybersecurity. Register here for a discounted ticket.
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From Risk & Compliance Journal
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Crypto VC Firm Digital Currency Group Registers to Lobby
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Digital Currency Group Inc., a cryptocurrency-focused venture-capital firm, has registered to lobby Congress, according to a disclosure filing submitted on Monday.
Julie Stitzel, vice president of public policy at the Stamford, Conn.-based firm, has registered as a lobbyist to work on digital-assets regulations, according to the filing. The cryptocurrency investor has backed many large businesses in the sector, including digital-currency asset manager Grayscale Investments LLC, crypto trading firm Genesis Global Trading Inc. and exchange Coinbase Global Inc.
Digital Currency Group didn't immediately respond to a request for comment.
The registration comes as the crypto industry faces increased regulatory scrutiny and looks to expand its influence by building its ranks of advisers and lawyers familiar with Capitol Hill. The sector has hired scores of former government officials and regulators as it seeks to shape policies to govern the largely unregulated industry.
—Mengqi Sun
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Liberty Mutual Unit Appoints New Chief Risk Officer
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Liberty Mutual Insurance Co. has appointed Crystal Ottaviano as chief risk officer of its Global Risk Solutions unit, which offers commercial and specialty insurance and reinsurance.
Ms. Ottaviano will join GRS effective Sept. 1 and will report to GRS Chief Financial Officer Alison Erbig, Liberty said.
Ms. Ottaviano joins from Aspen Insurance Holdings Ltd., where she was group chief risk officer, and previously worked as chief risk officer of Swiss Reinsurance America Corp. and head of risk management at Hiscox US.
—Richard Vanderford
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A JBS plant in Greeley, Colo. PHOTO: MICHAEL CIAGLO/BLOOMBERG NEWS
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Brazilian meatpacking giant JBS SA has named a new chief compliance officer and announced the creation of a committee meant to ensure a more consistent compliance program across its global operations, moves that come in the wake of high-profile antitrust and bribery settlements.
JBS said on Tuesday it had appointed Michael Koenig its chief ethics and compliance officer, moving him up from his previous role as head of compliance at JBS subsidiary Pilgrim’s Pride.
The company also announced the creation in June of a global executive compliance committee aimed at creating a more uniform and consistent compliance program across all its units, including Pilgrim’s. The committee has been tasked with “overseeing continued improvements and enhancements to the compliance program,” JBS said.
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Amazon.com Inc. is accusing the Federal Trade Commission of making excessive and unreasonable demands on founder Jeff Bezos and company executives as the agency probes Amazon’s Prime membership program.
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In a petition to the FTC filed earlier this month and recently made public, Amazon says the agency’s demands on the company have been “overly broad and burdensome,” and its legal tactics have been unfair.
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An investigation by World Wrestling Entertainment Inc.’s board of directors into allegations of sexual misconduct against former chairman and chief executive Vince McMahon is “substantially complete,” the company said in a securities filing on Monday.
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A data-marketing and analytics company has sued the Federal Trade Commission, saying the agency is wrongly threatening to sue it for marketing geolocation data that might be used to track consumer visits to sensitive locations such as abortion clinics.
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A Johnson & Johnson subsidiary urged a federal appeals court to uphold the controversial legal strategy it used to move to bankruptcy roughly 38,000 lawsuits linking its talc-based products to cancer.
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The Labor Department fined Dollar General Corp. over workplace safety issues after it found problems at three of the company’s Georgia locations earlier this year.
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A former Democratic congressman from California created off-the-books business accounts to solicit and steal roughly $2 million, the Justice Department said Tuesday, charging him in a number of financial fraud schemes including one that allegedly raised more than $25,000 in illegal straw donations for his 2018 House campaign.
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Videos shared on social media show plumes of smoke as explosions struck at an ammunition dump in northern Crimea on Tuesday, according to Russian authorities. PHOTO: SERGEI MALGAVKO/TASS/ZUMA PRESS
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Explosions rocked an ammunition depot in Crimea, damaging rail tracks and power lines and marking a fresh blow to Moscow’s war effort.
The blasts were set off by Ukrainian saboteurs, according to a senior Ukrainian government official. Russian officials also blamed sabotage, their first official acknowledgment of a major strike on the peninsula.
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For the past two decades, China has conditioned global companies and markets to anticipate big government spending at any hint of an economic slowdown. Now, as growth sputters, Beijing is taking only small steps toward boosting its ailing economy.
On Monday, China’s central bank cut two key interest rates, as fresh economic data showed a range of economic activity slowing in July. Unlike in the U.S., interest rates in China have a limited effect, and economists said the move would likely do little to encourage further borrowing by households and businesses.
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Natural-gas prices in Europe closed at a new record Tuesday, with hot summer weather boosting fuel demand and Russia throttling back supplies.
Europe has contended since June with drastically lower imports of gas from Russia, until recently its biggest supplier by far. Moscow cut flows through the Nord Stream pipeline by 80% to punish Germany and others for supporting Ukraine. Fearing President Vladimir Putin will order a full cutoff, the European Union has embarked on a plan to conserve gas now to burn it over the winter.
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A labor organization that earlier this year became the first to unionize an Amazon.com Inc. warehouse in the U.S. has filed to hold an election at a company facility in upstate New York near Albany.
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Signal has been a go-to messaging app for users concerned about surveillance since Open Whisper Systems launched the app in 2014. PHOTO: NICOLAS ASFOURI/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Signal, which is widely seen as one of the most secure messaging services, said Monday that a phishing attack compromised 1,900 users and potentially revealed their phone numbers.
The encrypted messaging app said on its website that an attacker had accessed the information through Twilio Inc., a company that provides Signal with phone number verification services.
Signal said the attacker, whom it didn’t identify, didn’t access its users’ messages, contact lists or profile information. Still, the attacker saw either the users’ phone numbers or the registration codes that some users received over text when they first signed up for Signal.
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XPO Logistics CIO Mario Harik is also president of its North American less-than-truckload business. PHOTO: XPO LOGISTICS INC.
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XPO Logistics Inc. announced earlier this month that it would promote its CIO to CEO, a move that highlights the increasing importance of data and technology in the logistics sector.
Chief Information Officer Mario Harik, who is also president of XPO’s North American less-than-truckload business, will succeed current Chief Executive Brad Jacobs after XPO spins off its brokerage business in the fourth quarter, the company said on Aug. 4.
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H&M was wiped off China’s leading e-commerce, ride-hailing, daily-deals and map apps and sites last year. PHOTO: BLOOMBERG
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H&M resumed sales on a popular e-commerce platform in China, more than a year after the Swedish fashion brand was virtually erased from the Chinese internet after it expressed concerns about reports of forced labor in the country’s Xinjiang region.
Chinese social-media users noticed this month that H&M Hennes & Mauritz AB reopened its official store on Tmall, one of the flagship e-commerce platforms run by Alibaba Group Holding Ltd.
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Investment companies such as KKR & Co. and Brookfield Asset Management Inc. are raising money at a record clip to invest in power plants, telecom towers and data centers—businesses that can thrive even as inflation runs rampant.
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Walmart Inc. and Home Depot Inc. reported stronger revenue in the most recent quarter, signs that Americans are spending even as they pay more for fewer products and are shifting their purchases to mitigate the effects of inflation.
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