Category: Business

A Wells Fargo boss started by mocking a female executive’s fiancé, moved on to inappropriately touching and groping her, then threatened to take sales opportunities from her if she didn’t date him, according to a new lawsuit against the San Francisco-headquartered bank and the alleged harasser.

Wells Fargo management responded to complaints by the former VP and senior portfolio manager, who filed suit anonymously as Jane Doe, by forcing her to continue working with the man, attempting to block her from receiving a hefty referral fee and commission, and finally firing her, the lawsuit claimed.

Wells Fargo spokeswoman Laurie Kight said Wednesday the bank was reviewing the lawsuit. “We take all allegations of misconduct very seriously,” Kight said.

Doe started in an executive position at Wells Fargo in 2000, in a Los Angeles unit devoted to serving high-wealth clients, and was promoted to a senior VP position five years later, according to her lawsuit filed Wednesday in Los Angeles County Superior Court. Starting in 2016 and continuing into 2020, she was subjected to sexual harassment by a superior, Carl Nelson, a VP and senior private banker, her lawsuit claimed.

Nelson has since resigned from Wells Fargo, according to Doe’s lawyer Ronald Zambrano. Nelson did not immediately respond Wednesday to messages from this news organization at his new workplace in a different bank.

The Financial Conduct Authority has said it will change its approach to whistleblowers after a survey revealed widespread dissatisfaction among those who alert the regulator to wrongdoing.

The organisation acknowledged problems including whistleblowers not “feeling heard”; a lack of dialogue with them, which prompts doubts about the chances of a proper investigation; and frustration over a shortage of updates, sometimes interpreted as delay and inaction.

The majority of those who raised concerns with the regulator said they were “extremely or somewhat dissatisfied” with how they had been listened to and how issues had been explored, while most were dissatisfied with the outcome of their reports, an FCA study found.

When asked to rate overall satisfaction with the authority’s handling of their whistleblowing report, 15 of the 21 respondents said they were “extremely or somewhat dissatisfied”. Only two expressed any satisfaction.

The regulator said it was “disappointed” with the findings. “Whistleblowers are key in our efforts and we greatly value their contribution,” it said.

It pledged to make reforms, including improving the use of whistleblowers’ information, better communication over what has been done with their reports and engagement with the government over a review of whistleblowing legislation.

Fully backed by the Labor government, the Reserve Bank of Australia (RBA) board yesterday resumed aggressively raising interest rates. It is deliberately inflicting more suffering on working-class households in order to further cut real wages and consumer spending.

Building workers walk past Reserve Bank of Australia in Sydney, Nov. 1, 2022. [AP Photo/Rick Rycroft]
In announcing its decision to raise its cash rate from 3.6 percent to 3.85 percent, the RBA explicitly targeted wages—which have already been cut 4.5 percent in real terms over the past year. It said this level of “wages growth” was consistent with the bank’s inflation target, but it would continue to “pay close attention” to labour costs.

Real wages had fallen, RBA governor Philip Lowe told an RBA Board Dinner brimming with business leaders in Perth last night, but if inflation continued “workers will seek larger pay rises.” He said the “labour market” was “still very tight.” Therefore, the RBA was determined to pursue its course, “even if it is difficult for some people in the short term.”

In Huawei’s head office last month, staff gathered to celebrate the in-house development of software to replace a US system that, thanks to Washington’s export controls, the Chinese technology company was no longer able to purchase. “Three years ago, we were cut off from the old ERP [enterprise resource planning] system,” said Tao Jingwen, a Huawei board member and president of its quality, business process and IT management department. “Today we are proud to announce that we have broken through…

LOUISVILLE, Ky. (AP) — Two 10-year-olds are among 300 children who worked at McDonald’s restaurants illegally, a Labor Department investigation of franchisees in Kentucky found.

Agency investigators found the 10-year-olds received little or no pay at a McDonald’s in Louisville, the Labor Department said. The franchisee for the Louisville store was among three McDonald’s franchisees fined $212,000 in total by the department.

Louisville’s Bauer Food LLC, which operates 10 McDonald’s locations, employed 24 minors under the age of 16 to work more hours than legally permitted, the agency said. Among those were two 10-year-old children. The agency said the children sometimes worked as late as 2 a.m., but were not paid.

“Below the minimum age for employment, they prepared and distributed food orders, cleaned the store, worked at the drive-thru window and operated a register,” the Labor Department said Tuesday, adding that one child also was allowed to operate a deep fryer, which is prohibited task for workers under 16.

The former manager used inside information from a deal Morgan Stanley was advising on to generate HK$4.2mn in profits for herself and a friend.

A Hong Kong court has granted an interim injunction order allowing the freezing of about HKD 8.2 million in assets in an insider dealing case.

The case was brought by the SFC (Securities and Futures Commission), which suspects two individuals – Ms Tsang Ching Yi and Mr Barry Kwok Sze Lok – of engaging in insider trading in the stock of I.T Limited, a software company that was privatised in 2021.

The SFC alleged that Tsang obtained information relating to the privatisation of I.T Limited through her employment as a manager at an investment bank, and shared such information with her friend Kwok, before both traded in the stock using the inside information.

Though not named in the SFC’s statement, the investment bank was identified through Tsang’s licensing record to be Morgan Stanley – which was the adviser for I.T Limited’s privatisation offer.

The Fed had to choose between capitulation on inflation or letting the banking crisis mushroom. The twin crashes in the US’s commercial real estate and bond market have collided with $9 trillion uninsured deposits in its banking system, which can vanish in an afternoon in the cyber age.

The second and third biggest bank failures in US history have followed in quick succession. The Treasury and Federal Reserve would like us to believe that they are “idiosyncratic”. That is a dangerous evasion. Almost half of America’s 4,800 banks are already burning through their capital buffers. They may not have to mark all losses to market under US accounting rules but that does not make them solvent. Somebody will take those losses.

“It’s spooky. Thousands of banks are under water,” said Prof Amit Seru, a banking expert at Stanford University. “Let’s not pretend that this is just about Silicon Valley Bank and First Republic. A lot of the US banking system is potentially insolvent.” The full shock of monetary tightening by the Fed has yet to hit. A great edifice of debt faces a refinancing cliff edge over the next six quarters.

Only then will we learn whether the US financial system can safely deflate the excess leverage induced by extreme monetary stimulus during the pandemic. A Hoover Institution report by Prof Seru and a group of experts calculates that more than 2,315 US banks are sitting on assets worth less than their liabilities. The market value of their loan portfolios is $2 trillion (£1.6 trillion) lower than book value.

These lenders include big beasts.

Low-cost carrier Go First has filed for bankruptcy at the National Company Law Tribunal. The airline has also suspended its flight operations for three days – May 3, 4 and 5. It has cited mounting losses for its decision to file for bankruptcy. The airline has attributed the losses to delays in the delivery of Pratt and Whitney engines. It said that delay in delivery of the said engines has resulted in grounding of half its fleet of aircrafts.

Meanwhile, the directorate general of civil aviation (DGCA) has served a show cause notice to the airline for the sudden cancellation of flights without sharing prior information with it. The DGCA has also asked Go First to submit its plan of action for the resumption of flights. In a statement, the airline said that once the NCLT admitted its plea, the court would appoint an Insolvency resolution professional who would take over Go First’s operations.

Air Moldova has submitted to court a request to enter a pre-insolvency accelerated restructuring procedure. The airline says the move will help it avoid bankruptcy and absorb some $50mn from unnamed investors, according to a company press release.

The company blames its difficult financial situation on the debts inherited on privatisation, the loss of revenues during the COVID-19 crisis and the ban on flights after the invasion of Ukraine. It highlights that the state did not extend any financial support, while foreign airlines were supported during the COVID-19 crisis.

The company suspended all flights and ticket sales starting May 2. The resumption of activity will be possible within three days from a positive court decision, the company said.

“Investors are ready to invest around $50mn in Air Moldova. These investments would settle the company’s financial problems and would allow the company to renew its own fleet. Investments cannot be made outside the accelerated restructuring procedure due to the increased risk of an attack from existing creditors,” says Air Moldova.

The airline said that the accelerated restructuring will allow the company to use the capital injection strictly for the development of the company, so that later, in time, the existing debts will be paid.

Air Moldova was privatised in 2018 but the identity of the investors was never made public.

A report in the Wall Street Journal, published on the newspaper’s front page Monday morning, links important figures in the US business and political elite to financier and sex trafficker Jeffrey Epstein, who died in a federal prison in Manhattan in 2019 under circumstances that strongly suggest he was murdered to keep him quiet.

The Journal reporters wrote that they had gained access to Epstein’s private diary and other documents, “which include thousands of pages of emails and schedules from 2013 to 2017, [that] haven’t been previously reported.” The diary listed meetings with dozens of individuals, though it supplied little information about the content or subject of the meetings. The bulk of these engagements were at Epstein’s palatial townhouse in Manhattan.

Among those prominently mentioned in the Journal report were two high-level officials of Democratic administrations: William Burns, currently CIA director, formerly deputy secretary of state in the Obama administration; and Kathryn Ruemmler, currently general counsel for Goldman Sachs investment bank, who was White House counsel in the Obama administration.

Rioters smashed shop fronts and tried to set fire to police officers in Paris as up to a million people marched across France in May Day protests against President Macron’s reform to the pension age. Young men dressed in black from the anarchist “black block” movement were joined by hardline yellow vest protesters on a rampage at the front of the peaceful union-organised march, which moved through central Paris from the Place de la République to the Place de la Nation. The anarchists broke shop windows and bank frontages and set fire to bins as riot police on motorcycles moved in.

Officers using teargas and batons arrested several dozen violent protesters in the capital and at similar outbreaks on the edges of marches in Lyons, Toulouse and Nantes, which were staged by unions and left-wing parties as a “show of contempt” for Macron’s reform. About 12,000 police had been deployed for the marches after the interior ministry said it expected trouble from two or three thousand black block “wreckers” and violent followers of the yellow vest movement, whose protests inflicted heavy damage in Paris and other cities in 2018 and 2019.

Protesters from the radical climate movements were also active, spraying paint on shop fronts in the Place Vendôme, the central Paris home to jewellery shops, and also on the façade of the Fondation Louis Vuitton, the contemporary art museum financed by LVMH, the luxury brand giant.

Shares in Asia are set to decline after Wall Street fell on renewed concern about the banking sector before a Federal Reserve decision on Wednesday where US policymakers are expected to raise interest rates.

Equity futures in Japan, Australia and Hong Kong all declined, while US contracts edged lower in early Asian trade. The S&P 500 slipped 1.2 per cent on Wednesday, with the financial sector the second-worst performer after energy. 

US regional lenders PacWest Bancorp and Western Alliance Bancorp both slid at least 15 per cent just a day after J.P. Morgan Chase’s acquisition of First Republic Bank seemed to bolster confidence in the sector.

The decline in energy stocks followed a 5.3 per cent drop for the US oil price, the biggest decline since July, in a sign of unease about global growth. The decline stabilised early on Wednesday.

Elon Musk has threatened to reassign NPR’s Twitter account to another company.

In a series of emails sent to this reporter, Musk suggested he would transfer the network’s main account on Twitter, under the @NPR handle, to another organization or person. The idea shocked even longtime observers of Musk’s spur-of-the-moment and erratic leadership style.

Handing over established accounts to third parties poses a serious risk of impersonation and could imperil a company’s reputation, said social media experts.

“If this is a sign of things to come on Twitter, we might soon see even more of a rapid retreat by media organizations and other brands that don’t think it’s worth the risk,” said Emily Bell, a professor at Columbia Journalism School who studies social media. “It’s really an extraordinary threat to make.”

Last month, NPR effectively quit Twitter after Musk applied a label to the news organization’s account that falsely suggested it was state-controlled. Other public media organizations, including PBS and the Canadian Broadcasting Corporation, followed suit and stopped tweeting following similar labeling.

The U.S. is sending Ukraine about $300 million in additional military aid, including an enormous amount of artillery rounds, howitzers, air-to-ground rockets and ammunition as the launch of a spring offensive against Russian forces approaches, U.S. officials said Tuesday.

The new package includes Hydra-70 rockets, which are unguided rockets that are fired from aircraft. It also includes an undisclosed number of rockets for the High Mobility Artillery Rocket Systems, or HIMARS, mortars, howitzer rounds, missiles and Carl Gustaf anti—tank rifles. The weapons will all be pulled from Pentagon stocks, so they can go quickly to the front lines. The officials spoke on condition of anonymity because the aid has not yet been formally announced.

The latest shipment comes as Ukrainian officials say they are readying a counteroffensive — with Ukrainian Defense Minister Oleksiy Reznikov declaring they are in the “home stretch, when we can say: ‘Yes everything is ready.’” Ukrainian officials have said they are stockpiling ammunition to stow it along potentially long supply lines.

Reznikov said Monday that the key things for the assault’s success would be “the availability of weapons; prepared, trained people; our defenders and defenders who know their plan at their level, as well as providing this offensive with all the necessary things — shells, ammunition, fuel, protection, etc.”

NEW YORK – US stocks ended the trading day lower on Tuesday, with regional bank stocks recording another day of plummeting values ahead of an expected rate hike from the Federal Reserve.

The Fed is widely anticipated to raise its benchmark lending rate for a 10th – and possibly final – time on Wednesday as it looks to tackle high inflation through interest rate hikes.

The Dow Jones Industrial Average finished 1.1 per cent lower, at 33,684.46.

The broad-based S&P 500 fell 1.2 per cent to 4,119.60, while the tech-rich Nasdaq Composite Index declined 1.1 per cent to 12,080.51.

Crude oil futures also finished the day down more than five percent on regional banking concerns.

LONDON – Apple Inc urged a London tribunal on Tuesday (May 2) to block a US$2 billion (S$2.7 billion) mass lawsuit accusing it of hiding defective batteries in millions of iPhones by “throttling” them with software updates.

The tech giant is facing a lawsuit worth up to 1.6 billion pounds (S$2.6 billion) plus interest, brought by consumer champion Justin Gutmann on behalf of iPhone users in the United Kingdom.

Gutmann’s lawyers argued in court filings that Apple concealed issues with batteries in certain phone models and “surreptitiously” installed a power management tool which limited performance.

Apple said in written arguments that the lawsuit is “baseless” and strongly denies its iPhones’ batteries were defective, apart from in a small number of iPhone 6s models for which it offered free battery replacements.