1. Amazon Lies To Congress?
An investigation by Reuters showed that Amazon had copied products and rigged search results in India to increase sales. The investigation was based on thousands of pages of Amazon's internal documents that had been leaked. Other organizations such as the Markup, the Wall Street Journal, and the Capital Forum all have also released stories commenting on Amazon's products and use of seller data.
Amazon denies Reuter's allegation; however, the House Judiciary Committee is considered referring Amazon for criminal investigation. Amazon says that they did not mislead the committee and they want to correct the record. As it stands, Amazon has probably either misled the committee or lied to Congress and violated federal criminal law. This follows from an investigation that the Committee had been pursuing looking at how Amazon's use of digital markets: how they used third party seller data and if they favored their own products. Regulators are concerned with the power that firms like Amazon have and how it leads to unfair business practices.
2. $200 million payout to ‘LIBOR’ whistleblower
Earlier in the week, the Commodity Futures Trading Commission (CFTC) agreed to award a whistleblower almost $200 million for their role in assisting a probe into the manipulation of the London interbank offered rate (LIBOR). This payment, apparently to a former Deutsche Bank executive, is the largest ever payment under the US regulator’s whistleblower programme.
The ‘LIBOR Scandal’ – where banks including Barclays, Deutsche Bank, and Société Générale were eventually forced to pay multi-billion dollar settlements to the CFTC for their part in undermining the interest rate benchmark – happened almost a decade ago. In 2012, traders were found to be fixing the rate; as a result, it is now being phased out. This shockingly large payment signals the ongoing assiduity of financial regulators in the wake of such recent scandals.
3. UK Trade Deal with New Zealand
UK has entered a free trade deal with New Zealand to benefit both consumers and businesses. The deal will cut costs as it removes tariffs on a number of goods such as clothing, bulldozers, wine, and kiwi fruit. It will also open New Zealand's job market to UK professionals as they will be able to work in New Zealand more easily.
Since less that 0.2% of UK trade is done with New Zealand, the deal is unlikely to drastically boost the economy. However, post-Brexit, the UK is looking at making deals with other countries and has done so with Japan and Australia. Both those countries and New Zealand are part of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership which the UK has applied to. The British Secretary of State for International Trade hopes that these deals will assist in UK's application being approved.
The Labour and National Farmers Union have expressed their concern over the implications of the deal on UK farmers as the amount of imported food will increase (and might lower the standard of food) but UK farmers are not benefitting. They have expressed multiple concerns over the effect on employment and costs. The International Trade Secretary has attempted to reassure them about the increase in lamb imports as lamb season is different in both countries.
4. Klarna introducing new “pay now” service in anticipation of tougher regulation
The Swedish fintech firm, Klarna, renowned for its “buy now, pay later” (BNPL) service is soon to offer a “pay now” option in the shadow of a looming regulator crackdown. Just as the CTFC is maintaining a strong grip over US financial markets, the UK’s Financial Conduct Authority (FCA) is soon to start regulating BNPL products.
According to their own statistics, the FCA says that more than one in ten customers of a major bank who was using BNPL was already exceeding their overdraft limits. Controversy also surrounds their lack of transparency, as some argue it is unclear to consumers that they will be in debt as a result of using the service. This prompted the UK Advertising Standards Authority to ban several of Klarna’s adverts in 2020. This latest diversification represents Klarna’s attempts to survive the expected clamp down to ward against consumer harm.
5. Puerto Rico Electricity Outages
Earlier this year, Luma, a private company, took control of Puerto Rico's distribution of power. Ever since, there has been massive outages that have led to thousands marching in protest earlier this week. These outages are damaging appliances, leaving the elderly defenseless against the heat, and affecting education; people cannot work, students cannot attend online classes, and the damage to appliances has to led food and insulin being thrown out.
Puerto Rico's power grid has been unstable since Hurricane Maria hit the island in 2017. The government has working on strengthening it and the US Federal Emergency Management Agency has given 9.5 billion dollars. However, these outages have become longer and more frequent and people are demanding the removal of Luma.