Sunday, October 17News That Matters

Tag: Securities and Exchange Commission

Google Could Be Violating Labor Laws With Pay for Temp Workers

Google Could Be Violating Labor Laws With Pay for Temp Workers

Technology
But last year, in a company email, a Google manager said it appeared that 16 additional countries, including Brazil, Canada, Australia and Mexico, had some form of equal treatment laws for temps that the company had not properly recognized and had not taken any extra steps to be compliant with the local laws.As more countries introduce new regulations, Google is being forced to take action. In 2019, the Netherlands passed a law that requires Google’s staffing agencies to provide temps with the same benefits as the company’s permanent employees, such as sick pay, maternity and other paid leaves, health care and stock grants. This change affected at least seven Google temp workers in the country.“This is a situation we ought to avoid,” Mr. Barry, Google’s compliance manager, wrote in an emai...
Crypto’s Rapid Move Into Banking Elicits Alarm in Washington

Crypto’s Rapid Move Into Banking Elicits Alarm in Washington

Business
BlockFi, a fast-growing financial start-up whose headquarters in Jersey City are across the Hudson River from Wall Street, aspires to be the JPMorgan Chase of cryptocurrency.It offers credit cards, loans and interest-generating accounts. But rather than dealing primarily in dollars, BlockFi operates in the rapidly expanding world of digital currencies, one of a new generation of institutions effectively creating an alternative banking system on the frontiers of technology.“We are just at the beginning of this story,” said Flori Marquez, 30, a founder of BlockFi, which was created in 2017 and claims to have more than $10 billion in assets, 850 employees and more than 450,000 retail clients who can obtain loans in minutes, without credit checks.But to state and federal regulators and some me...
SPACs Went Up, Then Down, but They’re Not Out

SPACs Went Up, Then Down, but They’re Not Out

Business
The DealBook newsletter delves into a single topic or theme every weekend, providing reporting and analysis that offers a better understanding of an important issue in the news. If you don’t already receive the daily newsletter, sign up here.Back in 2015, one of my dishiest banking sources called, incredulous, with a tip about Aubrey McClendon. The disgraced energy executive, who was being sued by his own company, had found a way to raise money for a new venture: a special-purpose acquisition company, known as a SPAC for short.Rarely, if ever, had this source and I talked before about SPACs, also known as blank-check firms. At the time, most of Wall Street considered these financial vehicles tainted, a last resort for desperate dealmakers who couldn’t find other ways to raise funds.SPACs w...
A Skeptical Stock Analyst Wins Big by Seeking Out Frauds

A Skeptical Stock Analyst Wins Big by Seeking Out Frauds

Business
Last month, federal authorities charged the founder of the electric vehicle manufacturer Nikola, which had gone public in the summer of 2020, with defrauding investors. They were led there partly by the work of a little-known Wall Streeter named Nathan Anderson.A stock researcher and investor, Mr. Anderson and his upstart firm, Hindenburg Research, are having a moment. In early August, the Securities and Exchange Commission subpoenaed the sports betting firm DraftKings after Hindenburg said in a June report that it had potentially enabled black-market betting. And shares of Lordstown Motors have fallen nearly 70 percent since Hindenburg said in March that the electric truck maker was hyping commercial interest for its vehicle. Federal authorities are investigating Lordstown’s claims.Mr. An...
U.S. Authorities Seek Documents From Troubled Covid Vaccine Manufacturer

U.S. Authorities Seek Documents From Troubled Covid Vaccine Manufacturer

Technology
That decision does not mean the F.D.A. has broadly authorized Johnson & Johnson to distribute doses made by Emergent on an emergency basis. The F.D.A. signed off on previous batches of vaccine made at the Baltimore factory but with a warning that it could not guarantee the company had followed good manufacturing practices. The agency has cleared the equivalent of up to 75 million doses, but tens of millions remain in limbo.In a conference call with investors on Thursday, Emergent executives announced a $41.5 million hit from being forced to discard doses the F.D.A. had deemed unusable, and said the company had spent another $12.4 million to address manufacturing issues in Baltimore.The newly disclosed inquiries from federal and state agencies underscore a dramatic reversal of fortune f...
Robinhood Reveals Rising Revenue and a $1.4 Billion Loss

Robinhood Reveals Rising Revenue and a $1.4 Billion Loss

Technology
The company’s shareholders, however, stuck with it. Within a week, it raised two rounds of emergency funding totaling $4.4 billion to meet lending requirements for stock trades and to continue making trades. That funding resulted in Robinhood’s outsize loss in the first three months of the year.Robinhood attracted scrutiny from regulators long before the GameStop frenzy drew the national spotlight. In 2018, it announced that it would offer checking and savings accounts, claiming it was already backed by the Securities Investor Protection Corporation, a consumer protection group that oversees brokerages. After the group said it did not insure checking and savings accounts, Robinhood backtracked and started the service a year later.Last year, Robinhood was fined $65 million by the Securities...
In an about-face, Lordstown Motors says it has enough money and will start building trucks.

In an about-face, Lordstown Motors says it has enough money and will start building trucks.

Technology
A day after ousting two top executives, the electric truck start-up Lordstown Motors said on Tuesday that it was on track to start production in September even if it does not raise additional funding, contradicting what it told securities regulators just a week ago.In a filing to the Securities and Exchange Commission last week, Lordstown said it needed to raise more money and might not survive. Then, on Monday its founder and chief executive, Steve Burns, and the company’s chief financial officer resigned.But in a news conference hosted by the Detroit-based Automotive Press Association, the company’s new executive team presented a far more optimistic outlook without providing many details.Lordstown’s president, Rich Schmidt, said that the company would start making trucks at its plant in ...
As Scrutiny of Cryptocurrency Grows, the Industry Turns to K Street

As Scrutiny of Cryptocurrency Grows, the Industry Turns to K Street

Technology
The board of advisers at the digital chamber is stuffed with former federal regulators, including a former member of Congress and a recent chairman of the Commodity Futures Trading Commission, J. Christopher Giancarlo, who was named to the board of BlockFi, a financial services company that tries to link cryptocurrencies with traditional wealth managers.Max Baucus, the Democratic former chairman of the Senate Finance Committee, and Jim Messina, a former top Obama adviser, also have recently been named to senior industry posts.Lobbying disclosure records show that at least 65 contracts as of early 2021 addressed industry matters such as digital currency, cryptocurrency or blockchain, up from about 20 in 2019. Some of the biggest spenders on lobbying include Ripple, Coinbase — the largest cr...
Help Wanted: Someone With Money and Connections

Help Wanted: Someone With Money and Connections

Business
So you’ve been asked to become a director of a special purpose acquisition company, more commonly known as a SPAC. The job has something in common with being a director of a company. But there’s one big difference: Instead of overseeing a company that is building, selling or creating something, you’re in charge of a big pot of money.Sure, being asked to become a director of a SPAC is a coveted brass ring in certain circles. In return, you’ll be asked to contribute knowledge and capital to the SPAC, whose sole purpose is to find a company that wants to go public within two years. At that point, you’ll most likely no longer be a director.If it all works out, you can make a lot of money. But there are also risks — the biggest one being not finding a high-quality company in time that wants to ...
Money Market Funds Melted in Pandemic Panic. Now They’re Under Scrutiny.

Money Market Funds Melted in Pandemic Panic. Now They’re Under Scrutiny.

Business
The Trump-era working group suggested a variety of fixes. Some would revise when gates and fees kicked in, while another would create a private-sector backstop. That would essentially admit that the funds might encounter problems, but try to ensure that government money wasn’t at stake.If history is any guide, pushing through changes is not likely to be an easy task.Back in 2012, the effort included a President’s Working Group report, a comment process, a round table and S.E.C. staff proposals. But those plans were scrapped after three of five S.E.C. commissioners signaled that they would not support them.“The issue is too important to investors, to our economy and to taxpayers to put our head in the sand and wish it away,” Mary Schapiro, then the chair of the S.E.C., said in August 2012, ...