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The Morning Risk Report: Forced Labor a ‘Top-Tier’ Compliance Issue, Says U.S. Official
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Good morning. A top Department of Homeland Security official is saying a new U.S. law blocking most imports from China's Xinjiang region should be top of mind for compliance executives.
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The Uyghur Forced Labor Prevention Act, which is meant to prevent products potentially made from forced labor from being sold in the U.S., has met with plenty of criticism from Chinese authorities. American businesses operating in China also have expressed some concerns about the law, saying it could hold up shipments of goods and increase compliance costs.
Risk & Compliance Journal's Richard Vanderford spoke recently with Robert Silvers, a U.S. Department of Homeland Security undersecretary who chairs the interagency Forced Labor Enforcement Task Force. Mr. Silvers said that DHS has already targeted 1,452 cargo entries valued at $429 million in the three months since the law went into effect.
But Mr. Silvers said DHS wants the business community to know the department is committed to ensuring commerce continues unabated. "Facilitating legitimate trade is a cornerstone mission for us," he added. "We're committed to having legitimate trade come through and come through fast."
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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.
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The Securities and Exchange Commission has been punishing firms that use investor cash to cover costs without disclosing the practice. PHOTO: ANDREW KELLY/REUTERS
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The Securities and Exchange Commission alleged that Wave Equity Partners failed to promptly repay one of its funds for some expenses and didn’t tell investors for more than two years, as the regulator continues its crackdown on undisclosed costs charged to investors by private-equity firms.
The SEC’s cease-and-desist order said that between 2018 and the end of 2020, Wave Equity, which makes growth-equity investments in clean energy and environmentally focused businesses, used about $1.1 million from its Wave Equity Fund II LP to pay fees to an outside vendor. Although the firm was required to promptly repay the fund by reducing management fees charged to its investors, Wave Equity didn’t take that step—and didn’t inform those investors about the issue—until last year, the SEC said.
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Two subsidiaries of French bank Crédit Agricole Group’s corporate and investment banking arm have agreed to pay more than $1.12 million in civil penalties to settle alleged violations of U.S. sanctions, the Treasury Department said on Monday.
CA Indosuez Switzerland SA, a Switzerland-based indirect subsidiary of Crédit Agricole Corporate and Investment Bank, has agreed to pay $720,258 for allegedly violating sanctions against Cuba, Iran, Sudan and Syria as well sanctions related to the annexation of Ukraine’s Crimea region, according to the Treasury’s Office of Foreign Assets Control.
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California, New York and six other state securities regulators sued cryptocurrency lender Nexo on Monday, saying its interest-bearing accounts amount to unregistered securities.
The six other states are Washington, Maryland, South Carolina, Oklahoma, Vermont and Kentucky.
In similar lawsuits, the state regulators allege that Nexo has offered and sold unregistered or unqualified securities in the form of its “Earn Interest Product” to residents of the eight states.
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A deli in southern New Jersey was the vessel for an elaborate fraud scheme involving three men who managed to inflate the company’s stock-market value to $100 million, according to federal prosecutors and regulators.
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American Airlines Group Inc. and JetBlue Airways Corp. will defend their partnership in a trial starting this week against government allegations that they are squelching competition in New York and Boston and harming consumers throughout the country.
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Ford Motor Co. is asking a Georgia court for a new trial, after a jury reached a $1.7 billion verdict against the auto maker last month involving a truck rollover accident that left two people dead.
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Twitter Inc. and Elon Musk continue to jockey for preliminary legal advantage ahead of a trial on their soured $44 billion marriage, as the presiding judge has signaled she wants to keep the case focused on the contractual agreement between the two sides.
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Biogen Inc. agreed to pay $900 million to settle allegations that it paid kickbacks to doctors to induce them to prescribe the company’s drugs, the Justice Department said on Monday.
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A reservist drafted during Russia’s partial mobilization in a bus outside a recruitment office in the Siberian town of Tara. PHOTO: ALEXEY MALGAVKO/REUTERS
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Resistance against Russia’s mobilization for its war in Ukraine took an increasingly violent turn Monday as two recruitment centers came under attack and borders remained clogged with fighting-age men seeking to leave the country amid reports that some were being turned back.
Monday’s violence, as well as growing lines at the border, are the latest signs that President Vladimir Putin’s initiative to reinvigorate a stalling war effort in Ukraine could backfire, pushing some Russian men to choose between being called up and leaving the country.
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The Biden administration is trying to stave off a bipartisan push on Capitol Hill to sharpen the enforcement of a proposed cap on the price of Russian oil, aiming to avoid an escalation that officials worry could upset the effort’s delicate diplomatic balancing act.
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Germany is drawing up plans to cap the price of electricity and gas that could be rolled out in the coming weeks, according to government officials.
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China has spent a trillion dollars to expand its influence across Asia, Africa and Latin America through its Belt and Road infrastructure program. Now, Beijing is working on an overhaul of the troubled initiative, according to people involved in policy-making.
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Storm Ian strengthened to a Category 3 hurricane as its center made landfall on Cuba’s southwestern flank early Tuesday, threatening to produce maximum wind speeds of 125 miles an hour, the National Hurricane Center said.
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Alan Jope has faced high investor pressure during his time as Unilever’s CEO. PHOTO: HOLLIE ADAMS/BLOOMBERG NEWS
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Unilever PLC said Chief Executive Officer Alan Jope plans to retire at the end of next year, signaling an end to what has been a challenging tenure at the helm of the maker of Dove soap and Ben & Jerry’s ice cream.
The CEO change comes as Unilever seeks to reinvigorate growth across its sprawling portfolio while grappling with rising input costs, changing consumer trends and broad economic uncertainty—issues that punctuated Mr. Jope’s tenure and will likely face his successor.
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Insurance broker and benefits firm Marsh & McLennan Cos. said Chief Executive Officer Daniel S. Glaser will retire at the end of the year and Chief Operating Officer John Q. Doyle will succeed him.
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Electric-car startup Faraday Future Intelligent Electric Inc. has secured up to $100 million in new financing to fund operations after reaching a deal with one of its largest shareholders to resolve a monthslong governance dispute.
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