CRIMINAL CAPITALI$M
Russian Billionaire Oleg Tinkov to Pay $500 Million for U.S. Tax Fraud

Malathi Nayak
Fri, October 1, 2021,



(Bloomberg) -- TCS Group’s billionaire founder Oleg Tinkov agreed to pay more than $500 million and pleaded guilty in a 2013 U.S. fraud case that accused him of concealing assets to evade paying taxes, the Justice Department said.

Tinkov, 53, hid $1 billion in assets and income when he renounced his U.S. citizenship following TCS Group’s initial public offering, according to an indictment unsealed last year. After his was arrested in February 2020 in London, he was contesting extradition to the U.S. while undergoing treatment for leukemia.

The alleged fraud is about half that of the biggest-ever tax evasion case brought by U.S. prosecutors. Robert T. Brockman, a Houston software tycoon, was charged in October with using a web of Caribbean entities to hide $2 billion in income.

Tinkov has agreed to pay $506,828,377, which includes unpaid 2013 taxes, the penalty for civil fraud and interest, according to a statement Friday by the Justice Department. Tinkov’s fortune is an estimated $8 billion, according to the Bloomberg Billionaires Index.

In 2013, Tinkov falsely reported income of less than $206,000 in a tax return even though he pocketed more than $192 million from the TCS initial public offering on the London Stock exchange in October of that year, according to U.S. prosecutors. Three days after the IPO, the billionaire went to the U.S. Embassy in Moscow to give up his U.S. citizenship, prosecutors have said.

His sentencing is set for Oct. 29 in Oakland, California.

The case is USA v. Tinkov, 4:19-cr-00489, U.S. District Court, Northern District of California (Oakland).

Lordstown to Sell Ohio Plant to Foxconn in $280 Million Deal

David Welch and Debby Wu
Thu, September 30, 2021


(Bloomberg) -- Lordstown Motors Corp. agreed to partner with Foxconn Technology Group in a $280 million deal that has the startup selling its former General Motors Co. factory in Ohio to the Taiwanese company in exchange for cash while also receiving an equity investment.

Under terms of the transaction, Lordstown Motors will sell the Lordstown factory to Foxconn for about $230 million after buying it from GM for just $20 million two years ago. The maker of Apple Inc.’s iPhone will buy $50 million worth of common stock in its new partner and will assemble the Lordstown Endurance electric pickup truck. The deal is contingent on the two sides reaching an agreement on manufacturing the vehicle. Foxconn plans to start mass production in April, according to a person familiar with its schedule.

Lordstown shares jumped as much as 12% in late New York trading Thursday. During regular trading hours, the stock rose 8.4%, closing at $7.98 after Bloomberg had earlier reported a deal was in the works. It’s still down 60% for the year.

The accord gives both companies something they badly need. Lordstown Motors gets a partner that will hasten the startup’s move into large-scale production, which will help lower the high costs required to make EVs. Foxconn gets a plant in North America where it can build its open-source electric vehicle platform and do contract manufacturing for partners like Fisker Inc.

“It’s less about a facility sale than a strategic partnership,” Lordstown Motors Chief Executive Officer Dan Ninivaggi said in an interview. “You have to find a way to get scale in the auto industry. Foxconn has a vision. They’ve got enormous capabilities in manufacturing and they will be able to fill that plant faster than we could.”

The two companies are working on a manufacturing pact that would agree to a certain cost basis for the Endurance pickup. Lordstown Motors would pay a fee on top of that, Ninivaggi said. Foxconn will make the $50 million equity investment immediately regardless of what happens with talks for an assembly partnership.

The CEO said Lordstown Motors will keep its assembly lines that make the hub motors for each wheel of the Endurance and also the line that assembles the pickup’s battery pack.

Racing to Production

Lordstown is racing to get its Endurance pickup into production early next year. Even if the truck is well received by customers, the company won’t fully utilize its Ohio factory anytime soon. So selling the facility and operating in parallel with Foxconn could help the company better leverage the plant where GM employed 10,000 people at its peak.

The company ousted Steve Burns, its founder and CEO, in June over misstatements he made about Endurance orders. Lordstown has repeatedly warned that its status as a going concern is in doubt less than a year after merging with a special purpose acquisition company to go public.

Burns’s successor, Ninivaggi, said in an interview last month that he was looking for partners to help the company take full advantage of a plant that was once the Mahoning Valley’s biggest industrial employer. He added he was exploring all options to raise money.

Lordstown Motors has been under investigations by the U.S. Securities and Exchange Commission and the Justice Department after an internal probe concluded that prior management made inaccurate statements about pre-orders for the Endurance. The company is pushing to start deliveries of the pickup next year.

GM’s decision in 2018 to close the plant was a blow to then-President Donald Trump, who a year earlier discouraged rally-goers in the region from selling their homes because of all the jobs he vowed to bring back. Democrats seized on the development as a symbol of unfulfilled promises Trump made to voters in a key battleground state.

Betting on EVs

Foxconn, meanwhile, is hoping to replicate its smartphone success by building clients’ electric vehicles from the chassis up. It’s rapidly expanding its EV business as major tech companies from Apple to Xiaomi Corp. invest heavily in technologies for next-generation mobility. Over the past year, the Taiwanese company has launched an open EV platform, inked a manufacturing deal with Fisker and formed a partnership with Thailand’s state-owned conglomerate PTT Pcl.

Earlier this year, Chairman Young Liu of Foxconn’s flagship unit, Hon Hai Precision Industry Co., said the company was considering creating an EV manufacturing facility in Wisconsin as its first U.S. automotive outpost. With Foxconn bulking up its automotive muscle, it’s seen as a contender in the race to make EVs for Apple.

The company has had a controversial history of bringing its manufacturing capabilities to the U.S. It originally committed to investing $10 billion in a Wisconsin facility in exchange for billions of dollars in possible subsidies, a project championed by then-President Trump. That vision was never realized, and Liu said earlier this year he’s trying to figure out what to make at the location.

Foxconn will rely on Ohio as its main EV manufacturing base in North America, while the company will still continue to invest in Wisconsin as a key site for tech products, according to a person familiar with the plans.

One of the projects Foxconn will build at the Lordstown plant is Fisker’s Project Pear, which stands for Personal Electric Automotive Revolution, company CEO Henrik Fisker said in an interview. That model is scheduled to start production in the first quarter of 2024 with a minimum planned production of 150,000 vehicles a year, eventually scaling up to 250,000 annually, he said.

Fisker’s CEO said he doesn’t want to reveal too much about the design of his company’s Project Pear except to say that it will target young urban dwellers and sell at a starting price under $30,000.

“It doesn’t have a normal trunk or hatch,” he said. “It’s basically trying to come up with a really cool vehicle that could excite the new generation of buyers, but it fits in their lifestyle and budget. It would take people out of a Toyota Prius or BMW X1.”

Foxconn will build EVs for Lordstown Motors and Fisker at Ohio plant

Kirsten Korosec
Thu, September 30, 2021


Foxconn will build electric vehicles for Lordstown Motors as well as its other partner Fisker Inc. at a former GM factory in Ohio, under an agreement announced Thursday.

Lordstown Motors, the beleaguered electric vehicle company that became publicly traded via a merger with a special purpose acquisition company, said Thursday it reached a nonbinding agreement with Foxconn to sell its 6.2-million-square-foot factory. Lordstown purchased the factory in 2019 from General Motors.

Under the agreement, which has yet to close, Foxconn will pay $230 million for the facility. The deal excludes certain assets such as Lordstown's hub motor assembly line, battery module and packing line assets and certain intellectual property rights. Foxconn will also buy $50 million of Lordstown common stock.

The companies said they will negotiate a contract manufacturing agreement for Foxconn to assemble Lordstown's Endurance full-size pickup truck at the facility. Reaching a contract manufacturing agreement is a condition to closing the facility purchase. The parties have agreed to explore licensing arrangements for additional pickup truck programs.

The deal comes at a critical moment for Lordstown Motors, a cash-strapped startup turned SPAC that had a string of missteps earlier this year. In August, the company hired Daniel A. Ninivaggi, a longtime automotive executive and former head of Carl C. Icahn’s holding company, as CEO and a board member. The appointment came after months of tumult at the company, including the resignation of its founder and CEO Steve Burns. CFO Julio Rodriguez resigned following a disappointing first-quarter earnings report that revealed the company was consuming more capital than expected and unable to reach previously forecasted production numbers for its electric Endurance pickup truck.

The goal of the partnership, the companies said in its announcement, is to present both Lordstown Motors and Foxconn with increased market opportunities in scalable electric vehicle production in North America. That includes Foxconn's existing partnership with EV company Fisker Inc. (Lordstown and Fisker are separate companies and have no connection.)

In May, Fisker signed an agreement with Foxconn to co-develop and manufacture a new electric vehicle under a program called Project PEAR. Production on the Project PEAR car, which stands for Personal Electric Automotive Revolution, will be sold under the Fisker brand name in North America, Europe, China and India. Pre-production is expected tp begin in the U.S. by the end of 2023 and will then ramp up into the following year, Fisker told TechCrunch in an an August interview.

Fisker didn’t reveal the U.S. manufacturing location. The final decision would be Foxconn’s, Fisker noted at the time.

Fisker issued a statement Thursday welcoming the news from Foxconn.

"Achieving key program objectives such as time to market, access to a well-developed supplier ecosystem and overall cost targets were all important factors in the decision to locate manufacturing in Ohio," Henrik Fisker said in an emailed statement. "Since signing the agreement with Foxconn earlier this year, we have been working together intensively on all aspects of Project PEAR including design, engineering, supply chain and manufacturing. Fisker's commitment to volume manufacturing in the United States takes another important step forward today with the signing of this agreement."

Fisker also has another vehicle program in the works with a different contract manufacturer. The Fisker Ocean SUV will be assembled by automotive contract manufacturer Magna Steyr in Europe. The start of production is still on track to begin in November 2022, the company reiterated in its second-quarter earnings call. Deliveries will begin in Europe and the United States in late 2022, with a plan to reach production capacity of more than 5,000 vehicles per month during 2023. Deliveries to customers in China are also expected to begin in 2023.

Foxconn tentatively agrees to produce electric vehicles in Ohio, doesn't rule out Mount Pleasant

Enlarge
The 6.2-million-square-foot Lordstown Motors production facility that Foxconn has agreed to purchase for $230 million
LORDSTOWN MOTORS IMAGE

By David Schuyler – Digital Producer, Milwaukee Business Journal
Oct 1, 2021

Foxconn Technology Group has reached an agreement in principle to buy a former General Motors Corp. production plant in Ohio that could enable it to begin manufacturing electric vehicles for Fisker Inc., work that Wisconsin officials had been seeking to bring to Foxconn's facility in Mount Pleasant.

Under the tentative agreement, Hon Hai Technology Group, the Taiwanese contract manufacturing company better known as Foxconn, would buy a 6.2-million-square-foot assembly plant near Youngstown, Ohio, from Lordstown Motors Corp. (Nasdaq: RIDE), a developer of electric vehicles for the commercial fleet market, for $230 million. Foxconn would also produce Lordstown Motors' Endurance full-size pickup truck under contract and acquire certain rights to future Lordstown programs.

According to a joint press release announcing the agreement Thursday, the "facility would serve as a speed to market asset that would also support Foxconn's partner and customer, Fisker Inc."

“In addition to achieving the goal of moving ahead our timeline to establish electric vehicle production capacity in North America, it also reflects Foxconn’s flexibility in providing design and production services for different EV customers," Young Liu, chairman of Hon Hai Technology Group, said in the release. "This mutually beneficial relationship is an important milestone for Foxconn’s EV business and our transformation strategy."

Foxconn and California electric car startup Fisker are partners in developing a new electric vehicle under a deal announced in February. The companies have been considering multiple states to potentially manufacture Fisker's Pear electric vehicle starting in late 2023, and earlier this year talks were confirmed with officials at the Wisconsin Economic Development Corp.

Enlarge
A view of Foxconn's Mount Pleasant campus from October 2020
CURTIS WALTZ, AERIALSCAPES.COM

In a separate statement, Foxconn said Wisconsin could still play a role in its electric vehicle strategy in the future.

"While initial electric vehicle production takes place in Lordstown, Foxconn’s assets in Wisconsin will continue to serve as a potential location for additional investment for Foxconn’s electric vehicle growth in the United States and continue to be the location for data infrastructure hardware and Information and Communication Technology production," Foxconn said.

The Mount Pleasant site is challenged by a Wisconsin state law that prohibits vehicle manufacturers from selling vehicles directly to customers. Fisker chairman and CEO Henrik Fisker was recently quoted saying Fisker wants to manufacture cars in a state where it could also sell them directly to customers.

Bills have been floated multiple times in recent years to change the Wisconsin law to allow that. The most recent proposal was introduced in late July.

Foxconn's deal with Lordstown Motors remains non-binding and is subject to the negotiation and execution of definitive agreements.

Under the tentative agreement, Foxconn also agreed to buy $50 million of Lordstown Motors' common stock and lease a portion of the plant back to Lordstown Motors for its Ohio-based employees. Foxconn also agreed to offer employment to Lordstown operational and manufacturing employees.

Lordstown Motors has been lauded for buying the shuttered General Motors auto plant and for bringing back hundreds of jobs to the plant.

But the electric vehicle developer, which was expecting to start producing its first Endurance electric truck models, ran into trouble. In early June, the electric vehicle developer revealed that it had insufficient cash to begin producing and selling its Endurance truck in late September as planned.

The company also said the production stall cast "substantial doubt" on whether it would be able to operate for a year without a cash infusion. Days later, the company's CEO and chief financial officer resigned following an internal investigation that found the company had misstated the demand for Endurance.

Mary Vanac of the Cleveland Business Journal contributed to this report.

GM's US factories will switch to renewable energy five years ahead of schedule

Steve Dent
·Associate Editor
Fri, October 1, 2021


Earlier this year, GM announced plans to go green by 2035 with the vehicles it produces and by 2030 with how it produces them. Now, the company has announced that it will be well ahead schedule on the "how" part, using 100 percent renewable energy across its US operations by 2025 — five years ahead of schedule.

To achieve the goal, GM said it would increase energy efficiency and source renewables for its facilities. It also plans to create technology to store renewable energy over the medium and long term and "create microgrids that help deploy renewable energy."

“We know climate action is a priority and every company must push itself to decarbonize further and faster,” said GM Chief Sustainability Officer Kristen Siemen. “That’s what we are doing by aiming to achieve 100 percent renewable energy five years earlier in the US."

It also detailed plans to work with a company called PJM Interconnection to track energy usage based on carbon output of the grid at any given time. "When the power being supplied consists mostly of fossil fuels, GM can make informed decisions about tapping into stored renewable energy or reduce the amount of power being consumed," the company said.

As for the vehicles it produces, GM plans to have 30 EVs globally by 2025, and still plans to "eliminate tailpipe emissions for new light-duty vehicles (i.e., cars, SUVs and pickups) by 2035." The wording suggests that could include hydrogen-powered cars, though GM appears to be focusing mostly on EVs.

GM's plans to reduce pollution have drifted with the political winds, however. It was one of several automakers that backed the Trump administration's plan to bar California and other states from setting their own pollution and zero-emission requirements. That would have allowed manufacturers to raise fuel efficiency by just 1.5 percent per year, well below the previous administration's five percent requirement. GM withdrew from the litigation shortly after Joe Biden was elected President.

Solar supply squeeze frustrates New Mexico's move away from coal

Nichola Groom
Thu, September 30, 2021

Sept 30 (Reuters) - A global solar panel supply bottleneck is frustrating plans to abandon an aging coal-fired power plant in New Mexico next year and raising concerns the state may be unable to keep the lights on as it weans its electricity sector from fossil fuels.

New Mexico's biggest utility warned state regulators this week that a large planned solar project will not be fully operational until a year after expected retirement of the coal-fired San Juan Generating Station. Earlier this year, the utility flagged other solar capacity delays.

This has prompted questions from state officials about whether the coal plant might need to keep operating beyond its scheduled retirement date of June 2022.

Public Service Company of New Mexico plans to close the 847-megawatt San Juan plant, the state's second-biggest source of pollution and greenhouse gases. It has pledged to source electricity from only carbon-free sources by 2040, while New Mexico has a state mandate to phase out fossil fuels in power production by 2045.

But this year, PNM officials began warning the New Mexico Public Regulation Commission of delays faced by three solar projects meant to help replace the coal plant. It cited supply constraints stemming from the pandemic.

On Wednesday, PNM said the developer of the 200 MW San Juan Solar project had notified it on Sept. 24 of further delays. The project will not be fully online until April of 2023, the utility said in a regulatory filing.

Photosol US Renewable Energy, which is developing the project with Clearway Energy, would not comment.

Two other solar projects, with a combined capacity of 400 MW, are also held up.

In April, 8minute Solar Energy told PNM its planned 100 megawatt Rockmont project could not meet the June 2022 timeline promised in its contract with the utility. PNM said it planned for a 12-month delay.

The 300 MW Arroyo Solar facility, which developer D.E. Shaw acquired from Centaurus Renewable Energy in August, will be fully operating by the end of 2022.

The delays mean the utility would be operating with a 5% reserve margin during peak summer demand season, it told regulators in July. The reserve margin is the difference between total generation available and forecast peak demand. One PRC commissioner said at a Wednesday meeting that the margin ideally should be around 18%.

When asked by the PRC in July about the possibility of extending the life of the San Juan coal plant, PNM said the utility would not rule out any options.

PNM did not respond to a question from Reuters about whether it was considering extending the life of the coal plant. (Reporting by Nichola Groom; Editing by David Gregorio)

JPMorgan’s Texas Muni Work Becomes Latest Culture War Fallout

Amanda Albright and Danielle Moran
Thu, September 30, 2021



(Bloomberg) -- The largest U.S. bank says it’s being shut out of underwriting municipal-bond deals in Texas after the state enacted a law banning government work with banks that limit business with the firearms industry.

Due to the legislation, JPMorgan Chase & Co. won’t bid on business with public entities in Texas, a key market where the bank underwrote $3.6 billion of municipal debt sales in 2020. Texas-based borrowers sold more than $58 billion of bonds in 2020, the most of any state after California, according to data compiled by Bloomberg. As part of bond offerings, borrowers often hire banks ahead of time and pay them a fee for underwriting the sales.

It’s one of the first signs of fallout from the Texas GOP’s effort to punish Wall Street banks for restrictive gun policies, with politicians in the gun-friendly state seeing it as a way of retaliating against them for weighing in on America’s fraught culture wars.

The law prohibits governmental entities from working with a business that “discriminates” against firearm and ammunition businesses or organizations, according to Republican Governor Greg Abbott, who has touted the legislation.

“While our business practices should permit us to certify, the legal risk associated with this ambiguous law prevents us from bidding on most business right now with Texas public entities,” Patricia Wexler, a spokesperson for the bank, said in an emailed statement.

The law was enacted as part of a flurry of GOP legislation, such as a law that restricts abortion rights and another that punished cities that defund their police departments. As part of Senate Bill 19, companies have to provide a written verification that they comply with the law, which applies to a contract that has a value of at least $100,000.

JPMorgan was ranked as the seventh-biggest underwriter of deals out of the state, which is one of the biggest markets for the muni-bond business thanks to its fast-growing population.

JPM Replaced

This legislation could be detrimental to municipal issuers in Texas, depending on ultimately how many banks are “captured” by the new law, said Martin Luby, a professor of public affairs at the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin. “There is a concern that the state and local governments wont have access to as many investors if the big banks aren’t participating in these transactions.”

Earlier this year, JPMorgan CEO Jamie Dimon told a Congressional committee that his bank won’t finance gun companies that make military-style weapons for consumers.

Still, the effect of the law is not entirely clear in Texas. Another bank that was targeted by the legislation, Citigroup Inc., said in June that it didn’t think it was affected by the law. In 2018, Citi said it would prohibit retailers that are customers of the bank from offering bump stocks or selling guns to people who haven’t passed a background check or are younger than 21. The bank was ranked as the biggest underwriter of Texas muni sales in 2020, when it was credited with underwriting $6.3 billion of long-term sales.

Mass Shootings

Bank of America also announced in 2018 it would stop making new loans to companies that make military-style rifles for civilian use. Its policy came after dozens of employees lost family members or suffered other trauma related to mass shootings in the past few years.

Bank of America was credited with underwriting $3.8 billion of municipal debt sales in Texas in 2020, making it the fifth-biggest underwriter there. A spokesperson for Citi didn’t provide an immediate comment on Thursday. Representatives for Bank of America and UBS did not respond to a request for comment.

It’s not the first time that municipalities or states have sought to punish Wall Street by cutting them off from new business. In 2018, Louisiana officials barred Bank of America and Citi from a bond sale, citing their restrictive gun policies.

And states like California in 2016 suspended Wells Fargo & Co. from bond work over the bank’s bogus accounts scandal.

Hospital Deal

The law is already crimping new business for JPMorgan.

This week, JPMorgan was replaced by UBS Group AG as the underwriter of a bond issue for Texas’s Decatur Hospital Authority, a local agency, according to a bond filing Thursday. The authority is an arm of a 7,000-person Texas city that operates Wise Health System. Decatur is the seat of Wise County and is about 65 miles (105 kilometers) northwest of Dallas. In July, the agency had disclosed that it was planning to have JPMorgan serve as senior managing underwriter on a financing that could include the sale of up to $150 million of bonds.

The authority cited “uncertainty related to the implementation of new legislation passed by the State of Texas,” though it didn’t specify which law.

Todd Scroggins, chief financial officer for Wise Health, didn’t respond to a request for comment, nor did a hospital spokesperson.

Related: Citi Says It’s Untouched by Texas Gun Law Punishing Wall Street

Chairman Mao's favoured carmaker enters Europe with EVs in Norway

STATE CAPITALISM PLUS ELECTRICITY 

EQUALS SOCIALISM    V.I. LENIN

Fri, October 1, 2021

A man walks past a Hongqi, or Red Flag, sign during an event of the Chinese car marque owned by FAW Group held at the Great Hall of the People in Beijing

BEIJING (Reuters) - Chairman Mao Zedong's favoured car brand, Hongqi, or Red Flag, is exporting China-made electric sport-utility vehicles to Norway, as Chinese car companies expand globally.

In a statement late on Thursday, Hongqi said it had received 500 orders for its cars in Norway, where it said there were environmentally friendly policies and good infrastructure for electric vehicles.

In China, the world's biggest car market, Hongqi's sales have grown in recent years thanks to the launch of more models and an expanded sales network.

Regarded as a cultural symbol of China's ruling Communist Party, Hongqi in 2018 hired former Rolls-Royce designer Giles Taylor, whose works include Rolls-Royce's Phantom VIII limousine and the brand's first sport-utility vehicle model the Cullinan, to head its design team in Munich.

China's electric carmakers, including Nio Inc, Xpeng Inc and BYD, are looking to capture European market share as the continent transitions to greener energy.

(Reporting by Yilei Sun and Brenda Goh; editing by Jason Neely)

CRIMINAL CAPITALI$M

Wells Fargo must face shareholder fraud claims over its recovery from scandals

Jonathan Stempel
Thu, September 30, 2021

FILE PHOTO: A Wells Fargo logo is seen in New York City

NEW YORK (Reuters) -A federal judge on Thursday rejected Wells Fargo & Co's bid to dismiss a lawsuit claiming it defrauded shareholders about its ability to rebound from five years of scandals over its treatment of customers.

The fourth-largest U.S. bank has operated since 2018 under consent orders from the Federal Reserve and two other U.S. financial regulators to improve governance and oversight, with the Fed also capping Wells Fargo's assets.

Shareholders said bank officials falsely claimed in TV interviews, analyst calls and congressional testimony that the bank was mending its ways, when regulators actually viewed its progress as "deficient" and "unacceptable."

U.S. District Judge Gregory Woods in Manhattan said the shareholders plausibly alleged that some statements by various bank officials, including former Chief Executive Tim Sloan, were "deliberately or recklessly false or misleading."

According to shareholders, San Francisco-based Wells Fargo lost more than $54 billion of market value as the truth was gradually revealed over a two-year period ending in March 2020.

Woods also dismissed claims against current Chief Executive Charles Scharf, saying he was not culpable for the challenged claims.

The scandals prompted Warren Buffett's Berkshire Hathaway Inc to shed nearly all of its 10% stake in the bank.

"We will continue to vigorously defend the litigation and strongly disagree with the claims," Wells Fargo said in an email.

Sloan's lawyer Josh Cohen said in an email on Friday that his client's statements were truthful, and that Sloan "worked tirelessly to bring Wells Fargo into compliance with consent orders and regulatory demands."

The decision is a setback for Wells Fargo's rebound from revelations including that it opened about 3.5 million accounts without customer permission, and charged hundreds of thousands of borrowers for auto insurance they did not need.

Wells Fargo has paid more than $5 billion in fines, and the Fed's $1.95 trillion asset cap restricts the bank's growth.

Sloan stepped down abruptly as chief executive after 2-1/2 years in March 2019. One year later, Wells Fargo canceled a $15 million bonus for him.

In his 61-page decision, Woods did not decide whether bank officials intended to defraud shareholders.

But he said it would have been "nearly impossible" for Sloan to be unaware of the regulators' criticisms.

"Based on the facts on the ground, Mr. Sloan knew or, more importantly, should have known that he was misrepresenting material facts related to the corporation," Woods wrote.

The shareholders are led by the state of Rhode Island, and pension funds in Louisiana, Mississippi and Sweden.

Their lawyer Steven Toll said he was pleased they can sue over the "vast majority of the alleged fraudulent statements."

The case is In re Wells Fargo & Co Securities Litigation, U.S. District Court, Southern District of New York, No. 20-04494.

(Reporting by Jonathan Stempel in New York; editing by Jonathan Oatis, Aurora Ellis and Cynthia Osterman)

India coal crisis brews as power demand surges, record global prices bite


Sudarshan Varadhan and Gavin Maguire
Fri, October 1, 2021

CHENNAI (Reuters) - Indian utilities are scrambling to secure coal supplies as inventories hit critical lows after a surge in power demand from industries and sluggish imports due to record global prices push power plants to the brink.

Over half of India's 135 coal-fired power plants have fuel stocks of less than three days, government data shows, far short of federal guidelines recommending supplies of at least two weeks.

Graphic: India's coal shortage crisis

 https://graphics.reuters.com/INDIA-COAL/SHORTAGE/zdvxoddbapx/chart_eikon.jpg

Prices of power-generation fuels are surging globally as electricity demand rebounds with industrial growth, tightening supplies of coal and liquefied natural gas.

India is competing against buyers such as China, the world's largest coal consumer, which is under pressure to ramp up imports amid a severe power crunch.

Rising oil, gas, coal and power prices are feeding inflationary pressures worldwide and slowing the economic recovery from the COVID-19 pandemic.

"The supply crunch is expected to persist, with the non-power sector facing the heat as imports remain the only option to meet demand but at rising costs," ratings agency S&P's unit CRISIL said in a report this week, adding it expected Asian coal prices to continue to increase.

"Coal inventory at (Indian) thermal plants will improve only gradually by next March."

Indian power producers locked in long-term agreements with distribution utilities cannot pass on higher input costs unless a clause to pass on such expenses is written into the contract.

Traders and officials at utilities said buying by power plants dependent of imported coal had been muted due to high prices.

India's average weekly coal imports during August through late September - when global coal prices rallied over 40% to all-time highs - dropped by over 30% from the average for the first seven months of the year, according to data compiled by Kplr.

The import total for the most recent week was under 1.5 million tonnes, the smallest in at least two years.

Graphic: India coal imports by supplier - https://fingfx.thomsonreuters.com/gfx/ce/gdpzyqlqrvw/IndiaCoalImportsbySupplier.png

Websites of major coal importing state utilities did not show any new tenders seeking new cargoes this month.

Coal prices from major exporters have scaled all-time highs recently, with Australia's Newcastle prices rising roughly 50% and Indonesian export prices up 30% in the last three months.

The September Indonesia coal price benchmark was as much as seven times higher than similar quality fuel sold by Coal India to Indian utilities, according to Reuters calculations.

"Traders who bought coal from Coal India in the spot auctions are making a killing. They are selling at 50-100% premiums," said a senior official in charge of sourcing coal at a large Indian utility operator.

State-run Coal India said this week higher global prices of coal and freight rates have pushed utilities dependent on imported coal to curtail power production, resulting in higher dependence on domestic coal-fired plants.

India is the world's second largest importer of coal despite having the fourth largest reserves. Utilities make up about three-fourths of its overall consumption, with Coal India accounting for over 80% of the country's production.

INDUSTRIAL POWER DEMAND SURGE

India's power plants are also grappling with surging demand from industries as economic activity rebounds from the latest wave of COVID-19 pandemic.

Power consumption in industrialised states including Maharashtra, Gujarat and Tamil Nadu grew between 13.9% and 21% in the three months ended September, a Reuters analysis of data from federal grid regulator POSOCO showed.

The three states account for nearly a third of India's annual electricity consumption. Industries and offices account for half the country's annual electricity consumption. During the last two quarters of the fiscal year ending March 2021, the residential and agricultural sectors were key drivers of power consumption after the first wave of coronavirus.

Graphic: India's industrial states driving power demand https://graphics.reuters.com/INDIA-COAL/POWER/byprjlwlkpe/index.html

"This year we have seen a tremendous growth in industrial demand," said Shahmeena Husain, Managing Director of Gujarat's electricity regulator told Reuters.

While there have not been any large scale power outages in India, deficits have increased nearly four-fold from the negligible levels recorded last year, POSOCO data showed.

The shortages have so far been mostly restricted to northern states such as Uttar Pradesh, Bihar and Kashmir, the data showed.

"Domestic consumption increased by about 10% in the last two years because of work from home and air conditioning," a senior Tamil Nadu government official told Reuters.

"Following opening up of industries after the second wave, industries are king," the official said.

(Reporting by Sudarshan Varadhan; Editing by Florence Tan, Lincoln Feast, Kirsten Donovan)

CRIMINAL CAPITALI$M

Pharmacy chains face first trial in U.S. opioid litigation, judge urges settlement

Oct 1 (Reuters) - Four large pharmacy chains are set to face their first trial over the deadly U.S. opioid epidemic, creating new pressure to reach settlements with state and local governments who accuse them of contributing to the public health crisis.

The Ohio counties of Lake and Trumbull allege that oversight failures at pharmacies run by Walgreens Boots Alliance Inc , CVS Health Corp, Walmart Inc and Giant Eagle Inc led to excessive amounts of opioid pills in their communities.

Lawyers for the counties and companies are set to deliver opening statements on Monday to a federal jury in Cleveland, where thousands of similar lawsuits against pharmaceutical companies, drug distributors and pharmacies are pending.

More than 3,300 cases have been brought largely by state and local governments seeking to hold the companies responsible for an opioid abuse epidemic that U.S. government data shows led to nearly 500,000 overdose deaths from 1999 to 2019.

Should a jury find the companies liable, U.S. District Judge Dan Polster will later determine how much they must pay to abate, or address, the epidemic in the communities.

Lawyers for the local governments have said the pharmacy chains are among their next targets for settlement.

Polster, who oversees most of the opioid lawsuits, on Tuesday renewed his long-running push https://www.reuters.com/article/us-opioids-litigation-judge/judges-unorthodox-approach-has-huge-opioid-settlement-within-reach-idUSKBN1WX1AT for a global settlement by the companies. "Use this trial as an opportunity to engage in the kind of meaningful discussions that have not happened over the last couple of years, all right?" he said.

At trial, the two counties are expected to argue the pharmacies created a public nuisance by failing to identify red flags and ensure prescriptions were valid, causing an oversupply of pills, overdoses and deaths.

"The national chain pharmacies in our case refused to give their pharmacists the necessary tools and opportunities to follow the law and stop the diversion and improper sale of opiates," said Mark Lanier, the counties' lawyer.

The companies deny wrongdoing, saying criminals were more likely to obtain opioids illegally from other sources, including pill mills, crooked doctors and drug traffickers.

"Opioid prescriptions are written by doctors, not pharmacists," CVS said in a statement. "Our pharmacies fill legitimate prescriptions written by licensed doctors."

Walgreens said it took "great pride in the judgment of our pharmacy professionals," and Giant Eagle said regulators who inspected its pharmacies in the two counties found it complied with the law. Walmart did not respond to requests for comment.

The trial comes after the three largest U.S. distributors that supply pharmacies - McKesson Corp, Cardinal Health Inc and AmerisourceBergen Corp - and the drugmaker Johnson & Johnson in July proposed paying up to $26 billion to settle cases against them.

A bankruptcy judge in August approved a settlement by OxyContin maker Purdue Pharma LP and its wealthy Sackler family owners that the company values at more than $10 billion.

The pharmacy chains in the Ohio case have only settled one case nationally. Ahead of a trial in New York, they and Rite Aid Corp agreed pay $26 million to settle with two counties.

Rite Aid settled pre-trial in Ohio and agreed to pay Trumbull at least $1.5 million. Lake County has not disclosed its recovery. (Reporting by Nate Raymond in Boston; Editing by Noeleen Walder and Bill Berkrot)

US Special ops troops ‘hunkered down’ in California airport hangar after nighttime ninja attack

BY CHAD GARLAND• STARS AND STRIPES • SEPTEMBER 30, 2021

An MH-47G Chinook assigned to the 160th Special Operations Aviation Regiment refuels at Naval Air Station North Island, Calif., in 2019. Soldiers who may have been members of the 160th SOAR were attacked Sept. 18, 2021, by a sword-wielding man dressed as a ninja while they were training at Inyokern Airport, about 100 miles north of Los Angeles. (Daniel Snider/U.S. Air Force)

A sword-wielding man dressed as a ninja attacked several special operations soldiers who were training at a California airport, reportedly forcing them to shelter in a hangar and inflicting wounds that required stitches.

The bizarre assault took place at Inyokern Airport, an airfield in the Mojave Desert about 100 miles north of Los Angeles, sometime after 1 a.m. on Sept. 18, according to what appears to be a military incident report shared on Instagram and Reddit.

Records from the Ridgecrest Police Department seem to confirm some details in the document posted to social media in a photo late Wednesday that said two soldiers had to receive stitches before returning to duty.

After confirming that the incident described in the document leaked on social media did occur, U.S. Army Special Operations Aviation Command spokesman Maj. Jeff Slinker said officials did not have any further information to add.

The soldiers’ names were redacted in the photo shared on social media — but one was identified as a staff sergeant and the other as a captain. The details suggest that they are members of the 160th Special Operations Aviation Regiment, an elite helicopter unit known as the Night Stalkers.

The staff sergeant was sitting outside the administration building at the airport hangar smoking a cigarette when he was approached by “an unknown person wearing full ninja garb,” the photographed document states.


A screenshot of what appears to be a military incident report shared on Reddit describes an attack on a group of soldiers Sept. 18, 2021, in California by a sword-wielding man dressed as a ninja. (Reddit)

It is unclear from the records whether the man was an actual practitioner of ninjutsu.

“Do you know who I am?” the ninja asked, to which the soldier replied no, according to the document.

“Do you know where my family is?” the black-clad man then asked. The staff sergeant again answered no.

“The person in ninja garb began to slash at (the soldier), striking his phone and his knee and leg,” the record states.

The staff sergeant took off running across the parking lot to escape the attacker, and then he jumped a fence and entered the administrative building, where he and the captain locked doors and called 911.

Meanwhile, the man dressed as a ninja was “kicking and punching doors and windows” before leaving to grab a large block of asphalt, which he heaved through the window of the administration building.

The captain was struck by the chunk of asphalt, said the document on social media.

The first assistance call was recorded about 1:20 a.m., the Ridgecrest Police Department log shows. A man “with a sword” was in a parking lot, and there was at least one victim, the log states.

About 30 minutes later came a second call via 911: “26 spec op military members doing training at the airport,” the log states. “Hunkered down in a hangar wondering where help is.”

The ninja fled and was arrested elsewhere, according to the document shared on social media.

It indicates that the soldiers were with F Co., 2nd Battalion, 160th SOAR, which had been tasked with support at Fort Irwin’s National Training Center.

The incident report photo was shared Wednesday on the Instagram meme page Daddy SOARbucks before appearing on Reddit.

The Daddy SOARbucks page posted several more memes mocking the company and the battalion over the incident.

The regiment did not immediately respond to a query seeking confirmation of the information shared on social media. It was unclear which law enforcement agency responded to the calls.