Category: Business

ESTONIA (Reuters): The chief executive of Danske Bank has resigned in the wake of a money-laundering scandal involving its Estonian operation.

Thomas Borgen stepped down following an investigation into payments of about €200bn (£177bn) through its Estonian branch.

The Danish bank said many of those payments were suspicious.

Mr Borgen said it was clear Danske had failed to live up to its responsibilities, which he regretted.

“Even though the investigation conducted by the external law firm concludes that I have lived up to my legal obligations, I believe that it is best for all parties that I resign,” he said.

The bank said it was unable to determine how much money was believed to have been laundered through its Estonian branch between 2007 and 2015.

Shares in Danske fell 7% in Copenhagen following Mr Borgen’s resignation and a lowering of its outlook for the full year.

Estonia’s Financial Supervision Authority (FSA) said it was now examining the findings of Danske’s internal investigation.

“The report describes serious shortcomings in the organisation of Danske Bank, where risk-appetite and risk control were not in balance,” said the Estonian FSA’s chairman, Kilvar Kessler.

The watchdog and Denmark’s financial supervision authority will now consider taking action.

The FSA said that it had carried out thorough inspections of Danske Bank’s Estonian branch in 2014.

The following year the FSA said it ordered the bank to rectify flaws in its risk control organisation. That resulted in Danske’s Estonian branch no longer serving customers who did not live in the country.

‘Massive tax scam’

The branch’s handling of Russian and former Soviet money has also been the focus of an inquiry in Estonia itself.

International financier Bill Browder is one of Russian President Vladimir Putin’s most public critics.

He has long alleged that Danske’s Estonian branch was “one of the main conduits related to the fraud”.

In July 2017, he gave evidence to the US Senate Judiciary Committee pertaining to allegations that Russia interfered with the 2016 US presidential elections.

Mr Browder set up and ran Russia’s most successful hedge fund, Hermitage Capital Management, from 1995 to 2005.

In 2005, he claims that the Russian government took over his firm and used it to claim a $230m tax refund.

Mr Browder was refused entry into the country for “national security” reasons, so he moved to London and asked his staff to move with him.

Magnitsky Act

Mr Browder said his lawyer, Sergei Magnitsky, refused to leave as he wanted to investigate evidence of what he said was a massive tax scam by Russian government officials. Mr Magnitsky died in 2009 while in Russian custody.

After Mr Magnitsky’s death, Mr Browder embarked on a worldwide campaign asking governments to pass legislation to freeze the assets involved and deny visas to human rights abusers.

In the US, this law was passed in 2012 and is known as the Magnitsky Act. The UK passed a similar bill in February 2017, updating its existing Proceeds of Crime Act.

In 2013, Mr Browder was tried in absentia in Russia and sentenced to nine years in prison for tax fraud.

Russia asked Interpol to arrest Mr Browder, but the international policing agency rejected the claim.

In May, Mr Browder was arrested and detained for two hours in Spain. He was released after Interpol announced that the arrest warrant was politically motivated.

ISTANBUL: Amazon.com said on Wednesday it had launched activities in Turkey, offering products across 15 categories to customers across the country.

“We are committed to building our business in Turkey in the coming months by expanding our selection and delivery options,” Sam Nicols, country manager for Amazon.com said in a written statement. (Reuters)

WASHINGTON (Agencies): Tesla Inc and its Chief Executive Elon Musk are under criminal investigation by the US Department of Justice over public statements about taking the electric carmaker private, it was reported on Tuesday.

Tesla did not immediately respond to a request for comment, while DoJ declined to comment.

Federal prosecutors opened a fraud investigation, the report said, citing two people familiar with the matter, over Musk’s tweets in early August that he had secured funding for a buyout deal valued at $72 billion, before backing off.

Musk has already been sued by short-sellers such as Citron Research and is facing a probe by the US Securities and Exchange Commission.

The billionaire CEO’s behaviour has raised concerns about his leadership, with several Wall Street analysts and some investors urging Tesla to appoint a strong second-in-command.

Musk has been under intense pressure to prove he can deliver consistent production numbers for the Model 3 sedan, which is crucial to Tesla’s plan to become a mass-market automaker.

He said on Monday the company is facing delivery bottlenecks as it ramps up production to meet its target of 6,000 cars per week.

Separately, Musk was sued for defamation on Monday for falsely suggesting that a British caver who helped rescue 12 boys and their soccer coach from a Thailand cave in July was a paedophile and child rapist.

Tesla’s stock, which has lost about 25 per cent since its gains on Aug. 7 after Musk tweeted about going private, fell 4.8 per cent to $280.79 on Tuesday.

 

 

 

 

LONDON (BBC News): The senior vice president of Honda Europe has warned that a no-deal Brexit would cost his company tens of millions of pounds. Ian Howells told the BBC that quitting the bloc without an agreement would affect the carmaker’s competitiveness in Europe.

He said the Japanese firm was preparing for a no-deal outcome but had not discussed relocating its Swindon plant. The firm builds its Civic model in Britain for the global market.

In an interview with Radio 5 live, Mr Howells said a no-deal Brexit would lead to costly trade barriers and disrupt its supply chain.

“In terms of administration, we’d probably be looking at something like sixty odd thousand additional bits of documentation we would have to provide to get product to and from Europe,” he told the Wake up to Money programme.

“And clearly if we end up with World Trade Organization tariffs we’d have something like 10% costs in addition on our shipped product back into Europe, and that would certainly run into tens of millions of pounds.”

“Likewise when we’re looking at componentry coming the other way, again [it could cost] tens of millions in terms of tariffs coming into the UK.”

Supply chain risks

Like other carmakers in Britian, Honda only stores about an hour’s worth of components at its Swindon plant to keep costs down.

Instead it relies on about 350 truckloads of parts that are delivered from the continent each day.

Mr Howells said the loss of “frictionless trade” in this supply chain would harm its production output and competitiveness.

“If we are shipping and competing against a European manufacturer in Europe, they are not incurring those tariffs,” he said.

“And in the UK it would be the componentry cost that would be the main additional burden we would have to carry for UK customers.”

 

 

NEW YORK (BBC News): Staff at McDonald’s restaurants in 10 US cities will walk out on Tuesday over claims the fast food giant is not doing enough to prevent sexual harassment.

The strike comes after 25 women filed complaints against the chain, alleging it failed to enforce company rules against abuse.

The women said they were ignored after reporting incidents including groping, indecent exposure and lewd comments.

McDonald’s said there was “no place for harassment” at its restaurants.

Organisers said the strike would target multiple restaurants in cities including Chicago, Los Angeles and Miami.

It is thought several hundred staff will walk out.

McDonald’s has a company-wide sexual harassment policy but the protestors – who are backed by the Time’s Up Legal Defense Fund – want to see improvements.

They say procedures for responding to harassment complaints are inadequate and that all staff should undergo anti-harassment training.

Since 2016, 25 McDonald’s workers have filed complaints with the US National Labor Relations Board, alleging their reports of harassment were ignored, mocked or met with retaliation.

The complaints named both McDonald’s franchisees and the company itself. However, the firm regards its franchisees as independent business owners.

In one example, Breauna Morrow, a 15-year-old cashier in St Louis, said that she had been “repeatedly harassed” by a co-worker using “graphic, sexual language”.

However, when she reported the incident her “supervisors did nothing”.

In another incident, an employee said she had reported being groped by a co-worker at a New Orleans outlet.

Instead of taking action, her managers mocked the woman and said “she was probably giving the worker ‘sex appeal’”.

‘Policies in place’

McDonald’s spokeswoman Andrea Abate said: “We have policies, procedures and training in place that are specifically designed to prevent sexual harassment at our company and company-owned restaurants, and we firmly believe that our franchisees share this commitment.”

McDonald’s also continues to face pressure from labour unions over the wages it pays it staff.

The Fight for $15, a national movement seeking to increase the minimum wage, has been pressurising the chain to increase wages and improve working conditions.

 

LONDON (BBC News): The Mini factory in Oxford will shut down for a month after Brexit at the end of March to minimise disruption in case of a no-deal outcome.

Owner BMW said its summer maintenance shutdown had been brought forward to 1 April to reduce any “possible short-term parts-supply disruption”.

“While we believe this worst case scenario is an unlikely outcome, we have to plan for it,” BMW said.

The German firm said it “remained committed” to its UK operations.

The Cowley plant, on the outskirts of Oxford, will remain open in April with maintenance, management and catering staff continuing to work despite no cars being made. BMW said the downtime would be used to start preparing the plant to make the new electric Mini.

Global operation

The UK is the only country where BMW makes cars under all three of its brands, which include Rolls-Royce.

The Cowley plant employs 4,500 people and produces 5,000 cars a week.

The concern is that in the event of the UK leaving the EU without a deal on 29 March, there could be disruption at the borders and shortages of parts.

Hundreds of lorries a day arrive at Cowley with parts from across the world, with 60% of components coming from the EU.

Other carmakers with British operations have warned that a bad or no Brexit deal would be damaging for the UK car industry.

Earlier on Tuesday, the head of Honda Europe, Ian Howells, told the BBC that a no-deal Brexit would cost his company tens of millions of pounds.

“In terms of administration, we’d probably be looking at something like sixty odd thousand additional bits of documentation we would have to provide to get product to and from Europe,” Mr Howells told BBC Radio 5 live.

“And clearly if we end up with World Trade Organization tariffs we’d have something like 10% costs in addition on our shipped product back into Europe, and that would certainly run into tens of millions of pounds.”

Last week, Jaguar Land Rover boss Ralf Speth warned the government to get “the right Brexit” or it could wipe out profits at the carmaker and lead to big job cuts.

 

 

 

Monitoring Desk

ANKARA: The European Commission has opened an in-depth investigation of whether several major automakers colluded to avoid competition, it announced on Tuesday. “The Commission is investigating whether BMW, Daimler and VW [Volkswagen, Audi, and Porsche] agreed not to compete against each other on the development and roll-out of important systems to reduce harmful emissions from petrol and diesel passenger cars,” Margrethe Vestager, commissioner for competition, said in a statement.

“These technologies aim at making passenger cars less damaging to the environment,” Vestager said.

“If proven, this collusion may have denied consumers the opportunity to buy less polluting cars, despite the technology being available to the manufacturers,” she added. The commission said the investigation will focuses on information showing those companies — also called the “circle of five” — participated in meetings where they discussed inter alia the development and deployment of technologies to limit harmful car exhaust emissions.

“The in-depth investigation will aim to establish whether the conduct of BMW, Daimler and VW may have violated EU antitrust rules that prohibit cartels and restrictive business practices, including agreements to limit or control technical development,” the statement said.

“At this stage, the Commission has no indications that the parties coordinated with each other in relation to the use of illegal defeat devices to cheat regulatory testing.

“The Commission will carry out its in-depth investigation as a matter of priority,” it added, noting that the opening of a formal investigation does not prejudge its outcome. (AA)

 

 

Monitoring Desk

ANKARA: The world’s leading cargo companies have applied to rental spots at the new Istanbul airport, Transport and Infrastructure Minister Cahit Turhan told Anadolu Agency. “Istanbul will also be the center of the global cargo transportation,” he said.

Turhan said the first phase of the new airport is set to be completed on Oct. 29.

“We will provide a great competitive environment especially for large companies that provide air cargo services globally, which will be able to operate in our country,” Turhan noted. Turhan underlined with the first phase opened, the new airport will welcome 90 million passengers annually, with 3,500 daily landings and take-offs.

He said it will also offer a 100,000 square meter area of living space, a 25,000-vehicle parking lot, a 42 km-long baggage conveyor system, as well as 143 boarding bridges. Turhan said the new airport will offer employment opportunity to 225,000 people.

Once complete, the new airport will offer flights to more than 300 destinations with an annual passenger capacity of up to 200 million.

A total of 1.38 billion people have passed through the country’s airports in the last 10 years, the General Directorate of State Airports Authority data shows.

 

F.P. Report

ISLAMABAD: TDAP is participating in World Food Moscow Russia with six (06) exhibitors relating to the products categories like rice, fruits & vegetables, spices etc. World Food Moscow, a four (04) day exhibition starting from 17th September, 2018, is a major exhibition serving the global food and drinks industry. Since its inception in 1991, the event has grown to become the entry point for international manufacturers looking to enter the vibrant Russian market. The event is the perfect platform to promote new food and drink products in Russia-attracting thousands of businesses from around the world.

Pakistan has constructed a customized pavilion with beautiful branding under the theme of “Emerging Pakistan” with the support of the Minister (Trade) Moscow, Mr. Nasir Hamid. The Pakistani Trade Wing in Moscow has invited relevant buyers from the major food related brands, chain stores and large importers of food items to the Russian Federation to visit the Pakistani Pavilion. The Trade Wing has also made arrangements for match-making and B2B meetings of Pakistani exporters with the foreign buyers at the platform of “World Food Moscow”. Several general visitors have visited the Pakistani Country Pavilion during the event. TDAP’s participation in “World Food Moscow” is expected to fetch several export orders for the Pakistani exporters.