Morning Read 5/10: Comey fired hours before Trump meets with Russian foreign minister

President Donald Trump fired F.B.I. Director James Comey Tuesday [Rich Girard]
President Donald Trump fired F.B.I. Director James Comey Tuesday [Rich Girard]

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INTERNATIONAL


Trump meets Russian foreign minister Sergey Lavrov one day after firing FBI chief James Comey

Donald Trump will meet Vladimir Putin’s senior diplomat at the White House on Wednesday in a signal that US relations with Russia have improved.

The US president recently described them as being at an “all-time low” but his talks with Sergey Lavrov mark the highest level, face-to-face contact with Russia of the American leader’s term in office.

Mr Trump’s talks with Moscow’s foreign minister will take place after the Russian’s meeting earlier in the day with US Secretary of State Rex Tillerson.

A Russian plan to stabilise Syria after more than six years of civil war is the most urgent foreign policy topic on the agenda.

But the meeting will be impossible to separate from the Trump administration’s unfolding political drama in Washington.

FBI and congressional investigations are looking into possible collusion between Trump campaign associates and the Kremlin related to last year’s presidential election.

The stigma of the Russia investigations has been impossible for Mr Trump to shake.

The president on Tuesday abruptly fired FBI Director James Comey, dramatically ousting the nation’s most senior law enforcement official in the middle of the bureau’s investigation into Mr Trump’s ties with Russia.

Mr Lavrov will be coming to the American capital with a Russian plan to end the violence in Syria, after hashing out an agreement with Iran and Turkey last week.

The Russian diplomat has not visited Washington at all since 2013, a year before Russia’s annexation of Ukraine’s Crimea region and two years before it intervened militarily in Syria to help Assad remain in power. [INDEPENDENT]

Trump Set to Arm Kurds in ISIS Fight, Angering Turkey

President Donald Trump approved plans to directly arm Kurdish fighters battling Islamic State in Syria, U.S. officials said Tuesday, paving the way for an offensive against the extremist group’s de facto capital but angering Turkish allies who view the Kurdish fighters as terrorists.

The decision to arm the YPG, the Syrian Kurdish militia the U.S. considers its most reliable military ally in the country, comes after a long debate within the Trump administration.

Turkey, a North Atlantic Treaty Organization ally, considers the YPG to be a terrorist group that threatens its borders, and it has long opposed the U.S. plans.

The decision sets the stage for the YPG and its Arab allies to launch an offensive on Islamic State in Raqqa, one of the extremist group’s last major strongholds in the region.

But it also complicates Mr. Trump’s efforts to repair U.S. relations with Turkey that reached a low at the end of the Obama administration. [WSJ]

Trump to announce Netanyahu-Abbas talks during Israel visit – report

President Donald Trump will announce the resumption of peace talks between Prime Minister Benjamin Netanyhau and Palestinian Authority President Mahmoud Abbas during his upcoming visit to the region, Palestinian media reported Wednesday.

According to the London-based daily Al-Hayat, Trump is expected to announce a trilateral summit with the two leaders during his one-day visit to Israel and the Palestinian Authority on May 22.

At the White House last week, Abbas reportedly told Trump that his negotiations with former Israeli prime minister Ehud Olmert nearly a decade ago should form the basis of any future peace talks with Netanyahu. [ToI]

Israel denies reports of Trump decision against US embassy move

Prime Minister Benjamin Netanyahu’s Office denied on Wednesday reports that it had received notice that US President Donald Trump has decided not to move the American Embassy in Israel from Tel Aviv to Jerusalem.

“Israel’s position is that all embassies, particularly the US embassy, should be in Israel’s capital – Jerusalem,” the Prime Minister’s Office said in a statement.

Earlier in the day, Israeli outlet NRG cited unnamed sources as saying the White House had relayed the decision about scrapping plans for the controversial move to the government in Jerusalem.

It remains to be seen whether Trump will make any announcement on his campaign pledge of moving the US embassy during his first visit as president to Israel and the Palestinian territories on May 22-23.

Palestinian and Arab leaders have warned the US against the move, saying it would trigger violence in Israel and elsewhere.

The US Congress passed a law in 1995 mandating the move of the embassy to Jerusalem, but allowed the president a waiver. Each president since then has routinely exercised the waiver, citing the national security interests of the United States.

In early March, an official United States delegation led by Congressman Ron DeSantis (R-FL) briefly visited Israel to study the possibility of relocating the American embassy.

While Trump had promised to relocate the embassy during his run for the White House, since his January 20 inauguration, his lukewarm statements about the matter led many to speculate that he would not make good on his pledge. [JPOST]


Bring Meron Home this Lag Ba’omer
By Yoel Krausz

Bonfires. Bows and arrows. Music. Upsherins. Dancing through the night. This is Lag Ba’omer.

Add the holiness of a special site and thousands upon thousands of people celebrating with you- and it is Lag Ba’omer at Meron. Being at Meron on Lag Ba’omer is an experience that stays with you for life- as kedusha, simcha, and energy permeate the air, leaving deep grooves of inspiration. But not all of us can be zoche to be at Meron each year, or have the opportunity to tap into its spiritual blessings.

But this year, you can! You can bring Meron into your home and life this Lag Ba’omer, with the Tehillim Kollel of Meron. Throughout the year, devout men pray at this holy site, completing the entire sefer Tehillim each day. But you can take advantage of the most special time of the year at the Kever of R’ Shimon bar Yochai and enlist these special messengers to engage in fervent prayers on behalf of your family. Whether you need Parnassah, Shalom Bayis, Children, Shidduchim or any other yeshuah, you can entrust your Tefillos to the ehrliche Meron Kollel, who will utilize all their powers of concentration and sincere devotion to storm the heavens with your requests.

Tehillim Kollel is offering exclusive savings for Lag Ba’omer day and also running special membership offers during this time. Late afternoon, this Friday, May 5 th , is the last day to sign up for Lag Ba’omer savings. For more detailed information, contact the Tehillim Kollel’s central office at (718) 705-7174 or email at info@tehillimkollel.org


NATIONAL


Comey learned he was fired from TV, thought it was prank: reports

FBI Director James Comey learned of his firing from a television news report, according to CNN and The New York Times.

Comey was in Los Angeles speaking to employees at an FBI field office when he saw the news break that President Trump had ousted him, the reports said.

According to the Times, Comey laughed when he saw the report, believing it to be a prank. Staffers then pulled him aside.

Keith Schiller, the director of Oval Office operations at the White House, hand delivered a letter from Trump to Comey informing him of his firing late Tuesday afternoon. But Comey was not there to receive it.

Trump’s letter stated that he was dismissing Comey because it was time for a “new beginning” at the nation’s “crown jewel of law enforcement.”

“While I greatly appreciate you informing me, on three separate occasions, that I am not under investigation, I nevertheless concur with the judgment of the Department of Justice that you are not able to lead the Bureau,” Trump wrote. [THEHILL]

Airport chaos, flights canceled: Spirit Airlines apologizes

FORT LAUDERDALE, Fla. – Irate passengers swarmed ticket counters and some started a near-riot at Fort Lauderdale’s airport after Spirit Airlines canceled nine flights, blaming the decision on pilots’ failure to show up.

Hundreds were left stranded at the airlines’ Florida terminal late Monday. The chaos was the latest instance of airlines dealing with high-profile customer frustration.

Deputies arrested three people from New York in the Fort Lauderdale airport, charging them with inciting a riot, disorderly conduct, resisting arrest and trespassing.

The Broward Sheriff’s Office said about 500 people were crowded into Spirit’s terminal at Fort Lauderdale-Hollywood International Airport late Monday night after the airline canceled the flights because there were no pilots. Video posted online showed deputies grappling with screaming passengers and breaking up fights.

The discount airline says pilots are refusing to pick up open flying assignments, which Spirit claims is an illegal and concerted plot by the Air Line Pilots Association to apply pressure during contract negotiations. It has filed a lawsuit, saying it has had to cancel about 300 flights nationally and internationally over the past week because of the union’s actions. Another 36 were canceled Tuesday.

Federal District Judge William P. Dimitrouleas issued a temporary restraining order against the union Tuesday, ordering its member pilots to not engage in any boycotts or slowdown, saying that would violate federal law.

Spirit spokesman Paul Berry issued a statement apologizing to customers and saying the company is “shocked and saddened” by the Fort Lauderdale melee. [FOXNEWS]

Tunnel collapses at Washington nuclear waste plant; no radiation released

A tunnel partly collapsed on Tuesday at a plutonium-handling facility at the Hanford Nuclear Reservation in Washington state, but there was no indication workers or the public were exposed to radiation, federal officials said.

Workers evacuated or took cover and turned off ventilation systems after damage was discovered in the wall of a transport tunnel about 170 miles (270 km) east of Seattle, officials with the Department of Energy’s Hanford Joint Information Center said.

The damage was more serious than initially reported, and the take-cover order was expanded to cover the entire facility after response crews found a 400-square-foot section of the decommissioned rail tunnel had collapsed, center spokesman Destry Henderson said in a video posted on Facebook.

“The roof had caved in, about a 20-foot section of that tunnel, which is about a hundred feet long,” he said. “This is purely precautionary. No employees were hurt and there is no indication of a spread of radiological contamination,” Henderson said of the shelter order.

No spent nuclear fuel is stored in the tunnel, Energy Department officials said. Energy Department Secretary Rick Perry has been briefed on the incident.

Tom Carpenter, the executive director with watchdog organization Hanford Challenge who has spoken with workers at the site since the incident, called the tunnel collapse worrisome and said the evacuation was the correct call.

“There is a big hole there and radiation could be beaming out,” he said.

Carpenter said he expects total cleanup costs could reach $300 billion to $500 billion. [REUTERS]


LOCAL


City doesn’t have to protect public from dangerous cabbies: appeals panel

The city has no “special duty” to protect the public from dangerous cabdrivers, according to a ruling by an appeals panel tossing the $27.5 million suit filed by injured British tourist Sian Green.

The former beauty queen lost her left leg when a yellow taxi jumped the sidewalk near Rockefeller Center in 2013.

Green, who was on Sixth Avenue at 49th Street when hack Faysal Kabir Mohammad Himon plowed into her, says the driver should never have been on the road.

She claims that the TLC acknowledged that, because of a computer glitch, Himon still had his license despite numerous penalty points.

But a five-judge panel agreed with a lower-court ruling that Green “alleges no facts sufficient to show a special duty owed by the city to her.” [NYP]

New York City’s newly opened ferry service already hit by constant delays

The city’s waterway is like the subway — delayed.

Mayor de Blasio’s new ferry service has had its ups and downs on the waves, with 20 alerts posted to the @NYCFerry Twitter account announcing delays and trip cancellations since the May 1 launch.

To plug gaps in service, Hornblower, the San Francisco-based company that landed the city’s contract to run the ferry routes, has had to charter an extra boat from New York Waterway — its competitor and a losing bidder for the service.

Commuters who were happy to ditch subway tunnels for the water have noticed boats are arriving off-schedule now that Hornblower is running the East River Ferry, which lowered its fare to $2.75 when it was folded into de Blasio’s citywide ferry service.

“These things used to run like clockwork. I’ve been taking this ferry for four years,” banker Ramine Ziai, 31, said at the Williamsburg dock on N. Sixth St. “I used to be early. Now, more often than not, a little late. I don’t know if it has to do with the new company.”

Jillian Cooney, 33, who works in the Financial District at S&P Global, stressed the importance of running the ferries on schedule as her boat, scheduled to depart at 8:14 a.m., pulled up a few minutes late.

“The boats only come every 25 minutes, so you’re really planning your day … around the specific times,” Cooney said. “So if you’re even five or 10 minutes late, that could be a big deal, especially in the morning if you have a hard start at 8 or 9.”

Still, like other riders, she was willing to let the new service get its sea legs.

“The older system seemed to be a little bit more reliable, but I’m sure they’re probably still just working out some kinks,” she said. [NYP]

Greenfield to host Mayor de Blasio in Boro Park Town Hall on Tuesday, May 16th

Councilman David G. Greenfield will host Mayor Bill de Blasio at a special town hall on Tuesday, May 16th at Franklin Delano Roosevelt High School at 5800 20th Avenue.

The event will allow Mayor de Blasio to learn more about pressing local concerns for residents of Boro Park, Midwood and Bensonhurst.

“I am pleased that the Mayor is coming directly to Boro Park to hear our concerns,” Greenfield said. “As they say, the buck stops with him. So if you have an issue that you feel passionately about, please join us this Tuesday night and have your voice heard directly by the Mayor.”

The town hall is co-sponsored by Community Board 12 and 14, the 66th and 70th Precinct Community Council, the Boro Park Jewish Community Council, COJO of Flatbush, the Chinese American Social Service Center and Sephardic Bikur Holim, along with Boro President Eric Adams and Assemblyman Dov Hikind.

“This is the first time that I can remember that a mayor was willing to come directly to Boro Park and have a conversation with anyone in the community,” Greenfield said. “This is a unique opportunity. I invite everyone in my Midwood, Boro Park and Bensonhurst district to join us.”

Although seating is free and open to anyone, there are a limited amount of seats so anyone wanting to attend must RSVP. To do so, email : townhallrsvp@cityhall.nyc.gov or call (212) 748-0281.


POLITICS


Trump fires FBI Director Comey, setting off U.S. political storm

President Donald Trump ignited a political firestorm on Tuesday by firing FBI Director James Comey, who had been leading an investigation into the Trump 2016 presidential campaign’s possible collusion with Russia to influence the election outcome.

The Republican president said he fired Comey, the top U.S. law enforcement official, over his handling of an election-year email scandal involving then-Democratic presidential nominee Hillary Clinton.

The move stunned Washington and raised suspicions among Democrats and others that the White House was trying to blunt the FBI probe involving Russia.

Some Democrats compared Trump’s move to the “Saturday Night Massacre” of 1973, in which President Richard Nixon fired an independent special prosecutor investigating the Watergate scandal.

White House officials denied allegations that there was any political motive in the move by Trump, who took office on Jan. 20.

Senate Democratic leader Chuck Schumer said he spoke to Trump and told him he was “making a very big mistake” in firing Comey, adding the president did not “really answer” in response.

An independent investigation into Moscow’s role in the election “is now the only way to go to restore the American people’s faith,” Schumer said.

Though many Democrats have criticized Comey’s handling of the Clinton email probe, they said they were troubled by the timing of Trump’s firing of him. [REUTERS]

Before Comey’s Dismissal, a Growing Frustration at White House

WASHINGTON — The more James Comey showed up on television discussing the FBI’s investigation into possible ties between the Trump campaign and Russia, the more the White House bristled, according to aides to President Donald Trump.

Frustration was growing among top associates of the president that Mr. Comey, in a series of appearances before a Senate panel, wouldn’t publicly tamp down questions about possible collusion with Russian interference in the 2016 presidential race. A person with knowledge of recent conversations said they wanted Mr. Comey to “say those three little words: ‘There’s no ties.’”

In the months before his decision to dismiss Mr. Comey as head of the Federal Bureau of Investigation, Mr. Trump grew unhappy that the media spotlight kept shining on the director. He viewed Mr. Comey as eager to step in front of TV cameras and questioned whether his expanding media profile was warping his view of the Russia investigation, the officials said.

One White House aide, speaking after Mr. Comey’s dismissal, described him as a show horse.

“Oh, and there’s James—he’s become more famous than me,” Mr. Trump said as Mr. Comey crossed the room to greet him at a Jan. 22 reception for law enforcement.

In firing Mr. Comey, Mr. Trump said he relied on recommendations by his top two Justice Department officials that the FBI needed new leadership. But he made a point of thanking the director for “informing me, on three separate occasions, that I am not under investigation.”

That purported detail about the FBI’s investigation into possible collusion between the Trump campaign and Russia hadn’t previously been disclosed. The FBI declined to comment. [WSJ]

Grand jury subpoenas issued in FBI’s Russia investigation

Washington (CNN) Federal prosecutors have issued grand jury subpoenas to associates of former National Security Advisor Michael Flynn seeking business records, as part of the ongoing probe of Russian meddling in last year’s election, according to people familiar with the matter. CNN learned of the subpoenas hours before President Donald Trump fired FBI director James Comey.

The subpoenas represent the first sign of a significant escalation of activity in the FBI’s broader investigation begun last July into possible ties between Trump campaign associates and Russia.

The subpoenas issued in recent weeks by the US Attorney’s Office in Alexandria, Virginia, were received by associates who worked with Flynn on contracts after he was forced out as director of the Defense Intelligence Agency in 2014, according to the people familiar with the investigation.

Robert Kelner, an attorney for Flynn, declined to comment. The US Attorney’s Office in Alexandria, the Justice Department and the FBI also declined to comment. 

Investigators have been looking into possible wrongdoing in how Flynn handled disclosures about payments from clients tied to foreign governments including Russia and Turkey, US officials briefed on the matter have told CNN.

The Flynn inquiry is one piece of the broader investigation, which FBI Director James Comey testified in a Senate hearing last week is led jointly by the Alexandria US Attorney’s Office and the Justice Department’s National Security Division.

Flynn was forced to resign as Trump’s national security advisor in February after failing to disclose the nature of phone discussions with Russia’s ambassador in Washington, Sergey Kislyak.

Congressional investigators have also accused Flynn of possibly breaking the law by not properly disclosing a $45,000 payment for an appearance he made at an event in Moscow to celebrate Russia Today. The Russian government-funded news outlet that US intelligence agencies say played a key role in disseminating stolen emails intended to damage the candidacy of Hillary Clinton in the 2016 presidential election.

Flynn’s lawyer, Robert Kelner, has said that Flynn was not hiding anything, noting that he briefed the DIA on his trip to Russia. [CNN]

FOCUS TURNS TO WHO’S NEXT

Trump expected to nominate replacement ‘in the coming days’
President Trump is expected to nominate a replacement for fired FBI Director James Comey “in the coming days,” a senior White House official told Fox News late Tuesday.

The official did not specify how soon Trump would nominate someone for the position. The official also did not indicate who was being considered for the position, but told Fox News to expect candidates who were non-political and could restore credibility to the position.

Here are some possible candidates:

— RAY KELLY: The longest-serving police commissioner in New York City, Kelly oversaw the force in the years following the Sept. 11 attacks when terror threats were routine. His tough-on-crime stance, including support for provocative tactics like stop-and-frisk, could make him a natural ally of Attorney General Jeff Sessions and a go-to-guy for a fellow New Yorker like Trump. Kelly as commissioner defended a police operation that conducted secret surveillance of Muslims. He could partner with Trump and Sessions on anti-terrorism efforts.

— CHRIS CHRISTIE: Though his relationship with Trump has been topsy-turvy, the governor of New Jersey has known the president for years and could bring law enforcement bona fides to the job. Christie is a former Republican-appointed United States attorney in New Jersey, and he cited that background time and again during his 2016 presidential campaign. His legacy as governor took a hit, however, with a Bridgegate scandal that was investigated by the FBI, prosecuted by the Justice and brought down some of his allies.

— DAVID CLARKE: A wild-card, but the outspoken and polarizing Milwaukee County, Wis., sheriff has been a fierce supporter of Trump and even landed a speaking spot at last summer’s Republican National Convention. A conservative firebrand known for his cowboy hat, Clarke has called himself “one of those bare-knuckles fighters” and has been critical of what he called the “hateful ideology” of the Black Lives Matters movement. But he’d be a long shot given that a county jury recently recommended criminal charges against seven Milwaukee County jail staffers in the dehydration death of an inmate who went without water for seven days.

— TREY GOWDY: The South Carolina Republican led the House committee investigation of former Secretary of State Hillary Clinton’s actions surrounding the deaths of four Americans in Benghazi, Libya. Gowdy is also a former federal prosecutor who boasts of his work on drug trafficking, bank robberies and child pornography cases. He was among lawmakers critical of Comey’s decision not to prosecute Clinton in the email server investigation, saying other government officials would have been prosecuted if they handled classified information like Clinton did, but federal officials disagree with that assessment. Gowdy said after Comey’s firing that though he had differences with the former FBI director on some matters, he “never lost sight of the fact that he had a very difficult job.” [FOX]

Clinton campaign team denounces Comey ouster

Hillary Clinton’s 2016 presidential campaign team was quick to denounce President Trump’s Tuesday firing of FBI Director James Comey.

Campaign manager Robby Mook said the move “terrifies” him.

The White House said Comey was fired at the recommendation of the Justice Department, but Brian Fallon, who was the Clinton campaign’s press secretary last year, said Trump’s decision “smells like a coverup on Russia” coming amid the FBI’s probe of Russian election interference and any possible ties between Trump’s campaign and Moscow.

“The president has accepted the recommendation of the attorney general and the deputy attorney general regarding the dismissal of the director of the Federal Bureau of Investigation,” White House press secretary Sean Spicer told reporters in the briefing room.

Comey infuriated both parties during last year’s campaign: first Republicans for announcing that the FBI would not recommend charges against Clinton for her use of a private email server while secretary of State, and later Democrats with his letter to lawmakers that the agency’s probe was not in fact complete.

Clinton last week partially blamed her election loss to Trump on that letter.

“I was on the way to winning until the combination of Jim Comey’s letter on Oct. 28 and Russian WikiLeaks raised doubts in the minds of people who were inclined to vote for me, but got scared off,” she said. [THEHILL]


CULTURE


Fidget spinner was invented to stop Palestinian kids from throwing rocks at Israelis

(JTA) — Do we have Palestinian rock throwers to thank for the fidget spinner?

The inventor of the ubiquitous stress-reducing toy says she came up with the idea during a trip to Israel in the 1980s, during the First Intifada, as a way to distract the “young boys throwing rocks at police officers.”

Catherine Hettinger told CNN Money last week that she first brainstormed the gadget while visiting her sister in the Jewish state and hearing about the clashes between Palestinian youth and Israeli security.

She first considered designing a “soft rock that kids could throw,” according to CNN Money.
“It started as a way of promoting peace,” Hettinger said.

But soon after, upon returning home to Orlando, Florida, Hettinger put together the first fidget spinner — a propeller-like toy that spins around a center bearing.

Hettinger secured a patent for the device in 1997, but sales languished for over a decade, and Hasbro declined to market it. Hettinger did not have the money to pay the $400 fee to renew her patent in 2005.

It was not until last year that the fidget spinner became a sensation, appearing everywhere from office cubicles to elementary school classrooms. Some tout the toy as a stress reliever, but others find them disruptive and distracting. [JTA]


FINANCE


Europe shares dip; dollar down on Comey sacking

European shares pulled back on Wednesday from 21-month highs hit after strong earnings while the dollar fell on concerns that U.S. President Donald Trump’s dismissal of his FBI chief could make passage of his tax reform plans more difficult.

Expectation-beating first-quarter company results have lifted stock markets across the globe, with European full-year earnings forecasts set to be their best since 2010. The prospect of U.S. tax cuts has also helped push shares higher.

At the same time, measures of market volatility are at rock-bottom. The U.S. VIX index fell on Tuesday to 9.56, its lowest since late 2006.

However, Trump’s abrupt sacking of FBI Director James Comey marked a fresh intrusion of politics into markets after Emmanuel Macron’s weekend victory in the French presidential election had seemed to clear the decks of major political risk, at least in Europe.

“There is no doubt that Trump is dominating proceedings this morning after the sacking of Comey. This is a political story rather than a market story, but yet again it creates uncertainty in the market, which leaves everything the president does with a cloud floating over it,” said James Hughes, chief markets analyst at GKFX in London.

The pan-European STOXX 600 index fell 0.2 percent, led down by construction and materials stocks, having hit its highest since August 2015 on Tuesday.

The U.S. president said he had fired Comey, who had been leading an investigation into the Trump 2016 campaign’s possible collusion with Russia, over his handling of an email scandal involving then-Democratic candidate Hillary Clinton.

The dollar fell 0.1 percent against a basket of major currencies after slipping on the view that political uncertainty could derail Trump’s tax reform plans, the prospect of which has helped lift riskier assets.

“The Comey news is being treated as a risk-off event, and the headlines were sparking the dollar’s move down,” said Bart Wakabayashi, branch manager for State Street Bank and Trust in Tokyo.[REUTERS]

Apple Reaches $800 Billion Market Cap, a First for Any U.S. Company

The world’s most valuable listed company just got even more valuable.

Shares of Apple rose 0.6% to an all-time high of $153.99 Tuesday, sending its market capitalization above $800 billion, a first for any U.S. company. That level, the latest evidence of how much the stock has risen this year, is a milestone sure to stoke speculation about whether it will be the first public company to be worth $1 trillion.

The company’s stock is up by about a third in 2017 and about two-thirds over the last 12 months. By itself, Apple’s market capitalization at Monday’s closing bell exceeded the combined market values of the 102 smallest companies on the S&P 500, according to FactSet.

The last time one of the 10 largest companies in the S&P 500 had a year-to-date stock-price run better than Apple’s in 2017 was in 2001, when Microsoft gained 66%, according to FactSet data that uses only current constituents in the benchmark. [WSJ]

U.S. Asks Wal-Mart to Pay $300 Million to Settle Bribery Probe

U.S. authorities have asked Wal-Mart Stores Inc. to pay $300 million to settle a five-year investigation into foreign bribery, according to a person familiar with the talks, a penalty far less than what the Obama administration had sought.

The settlement offer comes after Wal-Mart spent nearly $840 million on its internal investigation of the bribery allegations and upgraded compliance operations, according to financial filings.

Wal-Mart hasn’t yet agreed to the offer, this person said, but negotiations are in the final stages. Spokesmen for Wal-Mart and the Justice Department declined to comment. Bloomberg News earlier reported Wal-Mart was close to resolving the probe for $300 million.

As the Obama administration prepared to leave office late last year, the Justice Department and the Securities and Exchange Commission attempted to reach a settlement with the world’s largest retailer of as much as $1 billion.

Those talks stalled over several issues beyond the amount Wal-Mart would pay, including the retailer’s ability to accept food stamps in its 5,300 U.S. Wal-Mart and Sam’s Club stores. A company can lose its right to government contracts after pleading guilty to a federal crime.

Wal-Mart is one of the country’s largest recipients of food-stamp spending, taking in about 18% of the money disbursed through the Supplemental Nutrition Assistance Program. It is unclear how the government’s current offer would resolve this issue.

The Justice Department launched its investigation as a series of New York Times articles described alleged bribes Wal-Mart paid in Mexico to obtain permits to build stores there, potential violations of the Foreign Corrupt Practices Act. That spurred a wide-reaching investigation of Wal-Mart employee behavior across the globe, including in Brazil, China and India. [WSJ]

05/10/2017 10:33 AM by JP News Desk
Tags: Morning Read

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