|
|
|
|
|
The Morning Risk Report: Crypto Security Debate Goes to Court
|
|
|
|
|
|
Good morning. Investors are asking the courts to decide an existential question for the cryptocurrency industry: whether digital tokens are, for legal purposes, more similar to stocks or to gold.
Attorneys for cryptocurrency-trading platform Coinbase Global Inc. filed a motion this month to dismiss a class-action lawsuit arguing that 79 of the tokens listed on the firm’s platform are unregistered securities.
[Continued below...]
|
|
|
Content from our Sponsor: DELOITTE
|
|
3 Ways Quantum Computing May Create Ethical Risks
|
Quantum computing could revolutionize many business processes but is also likely to introduce new ethical risks to enterprises. Read More ›
|
|
|
|
|
|
The group of Coinbase users is demanding reimbursement for trading fees and market losses and seeking to prevent the assets from continuing to trade on the platform. Among the assets targeted in the lawsuit are four of the 10 largest cryptocurrencies by market value: XRP, Cardano, Solana and Dogecoin.
Outside of enforcement actions, the Securities and Exchange Commission hasn’t indicated which cryptocurrencies it considers to be securities. But federal statutes passed in the 1930s deputize ordinary investors to help the SEC do its job, by giving buyers of unregistered securities the right to sue the seller for their money back. The evaporation of some $1.5 trillion from cryptocurrency markets in the past six months could give investors a new incentive to test that power.
|
|
|
|
The Morning Risk Report will not be published Monday in observance of Memorial Day. We will resume publication on Tuesday.
|
|
|
From Risk & Compliance Journal
|
|
|
Glencore Said It Revamped Its Compliance Program Following Guilty Pleas
|
|
Glencore PLC said it has revamped its ethics and compliance program, including boosting its annual compliance spending and hiring more full-time compliance staff, as the global mining and trading company settles corruption and bribery charges in the U.S., U.K. and Brazil.
The Anglo-Swiss commodities company published a 13-page investor update on the same day it announced the settlements with various regulators, saying it has “invested substantial resources” in its ethics and compliance program and has renewed its commitment to integrity and transparency.
On Tuesday, Glencore said it would pay at least $1.2 billion and two business units would plead guilty to bribery in the U.K. and to conspiracy to violate U.S. anticorruption laws, resolving criminal probes that have hung over the business for years.
|
|
|
|
|
Twitter’s $150 million privacy settlement with the FTC represents about 3% of the company’s revenue last year. PHOTO: JUSTIN SULLIVAN/GETTY IMAGES
|
|
|
|
Twitter Inc. on Wednesday agreed to new oversight and a $150 million penalty to settle a federal privacy suit, the first major deal between a large tech company and the Biden administration Federal Trade Commission, which has pledged to more aggressively police data abuses.
Federal prosecutors alleged that Twitter collected phone numbers and email addresses for account security measures and then fed the information into its advertising tools, an additional use of the data the government said it failed to disclose. The alleged activity violated a 2011 consent order between the FTC and Twitter that barred it from misrepresenting how it used individuals’ contact information.
|
|
|
-
A U.S. central bank digital currency could one day provide consumers with a level of safety amid a proliferation of privately-issued digital assets such as stablecoins, Federal Reserve Vice Chairwoman Lael Brainard told House lawmakers Thursday.
-
A New York state appeals court ruled Thursday that former President Donald Trump and two of his adult children must testify under oath as part of the New York attorney general’s civil-fraud investigation into the Trump family business.
|
|
|
|
|
Pacific nations allied with the U.S. are concerned about China’s push to deepen security ties in the region, following its pact signed last month with the Solomon Islands; Honiara, the Solomon Islands capital. PHOTO: MARK SCHIEFELBEIN/ASSOCIATED PRESS
|
|
|
|
U.S. allies are pushing back against a Chinese proposal for deeper security and trade ties in the Pacific, with the president of one island country warning that China’s aim is to gain control of a region that has been at the center of competition between Washington and Beijing in recent years.
China plans to press Pacific nations at a summit in Fiji in the next few days to sign on to an agreement that would expand cooperation on law enforcement and cybersecurity, and explore the creation of a free-trade zone between China and the Pacific, according to a draft of the agreement reviewed by The Wall Street Journal.
|
|
|
-
Ukrainian President Volodymyr Zelensky dismissed suggestions that his country should cede territory to Russia in return for peace, comparing them to attempts to appease Nazi Germany, as Russia stepped up its attacks in Ukraine’s east
-
Sanctions against Russia have pushed its economy into what could be the biggest decline in decades, but the country’s currency has gone the other way.
-
Natural-gas prices are heating up ahead of air-conditioning season, adding pressure to household budgets and manufacturing costs.
|
|
|
|
|
Britain will introduce an ‘energy profits levy’ of 25% that will eventually phase out as oil and gas prices decline. PHOTO: JUSTIN NG/ZUMA PRESS
|
|
|
|
The U.K. said it would impose a temporary levy on oil-and-gas producers to help soften the pain of soaring energy prices on consumers, a rare so-called windfall tax aimed at blunting a worsening cost-of-living crisis.
British officials said Thursday they will introduce an “energy profits levy” of 25% that will eventually phase out as oil-and-gas prices decline. They said the surcharge amounts to an additional tax on top of current rates, effective immediately and lasting potentially to the end of 2025.
|
|
|
-
Apple Inc. is boosting pay for workers amid rising inflation, a tight labor market and unionization pushes among hourly store employees.
-
Microsoft Corp. said it would be slowing down some of its hiring, making it the latest tech giant to become more cautious about adding staff.
-
Discount retailers Dollar General Corp. and Dollar Tree Inc. reported earnings that beat Wall Street’s subdued expectations. The results showed resilience in the face of inflationary pressure that have weighed on consumers and rising freight and labor costs that have pressured many big retail chains.
|
|
|
|
|
EY last year had global revenue of $40 billion, of which $13.6 billion came from audit work. PHOTO: PHILIP TOSCANO/ZUMA PRESS
|
|
|
|
Big Four accounting firm Ernst & Young is considering a world-wide split of its audit and advisory businesses, amid regulatory scrutiny of potential conflicts of interest in the profession, according to people familiar with the matter.
A split would be the biggest structural change at a Big Four firm since Arthur Andersen fell apart some 20 years ago.
|
|
|
|
|
Remote work has dented WeWork’s finances and sent its stock price lower. PHOTO: KATE MUNSCH/REUTERS
|
|
|
|
Co-working space operator WeWork Inc. has hired Andre Fernandez as its chief financial officer, marking the third CFO appointment since March 2020. The company’s current finance chief, Benjamin Dunham, plans to leave after roughly 18 months in the role.
New York-based WeWork, which went public in October 2021 through a merger with a special-purpose acquisition company, said Mr. Dunham will depart on June 9. His exit is not related to financial disclosure issues or accounting matters, the company said.
|
|
|
-
McDonald’s Corp. shareholders voted down two director nominees backed by activist investor Carl Icahn as part of his effort to change the way the fast food giant’s pork suppliers treat hogs.
-
Broadcom Inc. Chief Executive Hock Tan’s $61 billion deal to buy VMware Inc. marks the biggest bet yet that the boom in enterprise software demand will endure despite the economic tumult—and that bundling disparate offerings of low-profile products can yield outsize returns.
|
|
|
|
|
Covid-19 has long hit seniors especially hard. A nurse works with a Covid-19 patient in Sheffield, Ala. PHOTO: DAN BUSEY/ASSOCIATED PRESS
|
|
|
|
Covid-19 deaths in the U.S. are hovering near the lowest levels since the pandemic hit, showing how a population with built-up immune protection is less at risk of severe outcomes even as another wave of infections flows through the country.
The nearly 300 deaths reported daily are again more concentrated among older people, underscoring hazards for the more vulnerable while the overall population appears less at risk.
|
|
|
Big-city population declines deepened across the U.S. last year as the pandemic continued sending Americans in search of more space, according to census figures released Thursday.
The largest cities lost a greater share of residents than small and midsize cities during the year that ended July 1, 2021, new estimates show. Collectively, in the nine cities with more than one million people, the population fell 1.7%, a loss of 419,000 residents. Only two cities in that group grew: Phoenix and San Antonio.
|
|
|
|
|
|
|