Wall Street Journal
By Samuel Rubenfeld
June 19, 2017
The announcement in Miami by President Donald Trump of a rollback in U.S. policy toward Cuba is several months away, according to a document released by the U.S. Treasury Department, and will be limited in its effects for companies, two legal experts said. However, they said, it could present challenges for U.S. companies considering new business on the island.
Treasury is going to have to implement, “at a very granular level,” the policy memorandum issued by Mr. Trump, which was at a higher level, said Michael Casey, an attorney with the firm Ropes & Gray whose practice includes representing companies on sanctions, export controls and corruption issues. “The Treasury will have to make some decisions about what the guidance means and how it will apply with U.S. companies that engaged with Cuba for the past three years,” he said, noting that the Treasury document said companies already involved in lawful transactions won’t necessarily be affected. “[Treasury] has seemed to make a distinction between companies already with business in Cuba and companies seeking new business,” he said, adding that those seeking new business should expect it to be more challenging. “Any companies seeking new business in Cuba that aren’t already in the country are going to pause and wait until [Treasury] issues the new regulations,” he said.
Harry Clark, a partner at at Orrick Herrington & Sutcliffe LLP who chairs the firm’s international trade and compliance group, stressed that “nothing’s happening now” with regard to the Cuba changes, and said he wasn’t sure they would have much of any effect on companies. “It wasn’t U.S. policy, even under [President Barack] Obama, to allow U.S. companies to engage in Cuba in ways that involved the Cuban military or the Cuban security services. It may have happened, but it wasn’t supposed to happen,” he said. Mr. Clark said there was an “exaggeration on both sides” as to the extent of liberalization under Mr. Obama and of the rollback announced by Mr. Trump. “I don’t see this as being that big of a deal,” he said.
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EXCLUSIVE ON RISK AND COMPLIANCE JOURNAL
U.S. workers more at risk of cybercrime. A study of 2,000 workers in the U.S. and U.K. by Wombat Security found half the U.S. respondents said they were victims of identity theft compared to 19% of U.K. respondents. Forty-six percent of those in the U.S. said they were duped by a phishing email compared to 17% in the U.K.
COMPLIANCE
Trump emphasizes Cuba human rights. In rolling back the Obama administration’s steps to normalize relations with Cuba, President Donald Trump on Friday appeared to shift from the approach he has used with other countries, in which the president has played down U.S. concerns about human rights, the WSJ reports. But in his speech Friday in Miami, Mr. Trump blasted the human rights and civil-liberties record of Cuba’s Castro regime, repeatedly saying that the U.S. embargo would remain in place until the island’s government took steps to open up.
U.S. President Donald Trump speaks about policy changes on Cuba on June 16.
Joe Raedle/Getty Images
EU extends Crimea sanctions. Radio Free Europe/Radio Liberty reports European Union foreign ministers have extended sanctions on Crimea, which were imposed following Russia’s annexation of the territory.
DATA SECURITY
EU agrees joint response to cybercrime. The Associated Press reports European Union foreign ministers have agreed to form a joint response to cyberattacks, including imposing sanctions on perpetrators.
Why some health-care hacks aren’t reported. A cyberattack last year paralyzed MedStar Health computers, forcing the Maryland operator of 10 hospitals and more than 300 outpatient centers to shut down its entire electronic-record system. Doctors logged patient details with pen and paper. Laboratory staff faced delays delivering test results. Yet the attack—and others last year at hospitals in California and Kentucky—don’t appear on the U.S. Department of Health and Human Services’s public list of data breaches. The attacks involved ransomware, a type of software that locks away data until victims pay a ransom. HHS rules say hospitals need only report attacks that result in the exposure of private medical or financial information, such as malware that steals data. When ransomware’s data encryption meets that threshold is a gray area.
Ad industry girds for European rules. Advertising executives love to talk up how they use mountains of data to target consumers. But gathering that data is about to become more of a headache, at least in Europe, the WSJ reports. New European Union legislation that goes into effect next May will restrict how companies can collect and use personal information about web users in Europe, requiring that they obtain “unambiguous” consent from those users. The move contrasts with the U.S., where lawmakers recently voted to overturn privacy rules that would have required telecom companies to get consumers’ permission before sharing their web-browsing and app usage with third parties.
GOVERNANCE
Venezuela crisis confronts Wall Street. A crisis of conscience is rippling through emerging markets, the WSJ reports, where portfolio managers are asking: Dare we hold on to Venezuelan bonds, let alone buy new ones, knowing that the authoritarian government of President Nicolás Maduro is choosing to pay lenders rather than feed its people? After borrowing about tens of billions from global investors in recent years, the country is spiraling into a humanitarian crisis. Venezuela’s $56 billion of outstanding debt makes up 3.5% of a widely followed emerging-market debt benchmark. Adding to the dilemma for investors, the 24% yield on some Venezuela bonds places them among the highest-yielding investments in the sector, and the debt has been one of the biggest winners on Wall Street over the past year.
Venezuelan activists protest Goldman Sachs outside one of their offices in Miami on June 1.
Agence France-Presse/Getty Images
Glass Lewis slams Toshiba. Bloomberg reports proxy adviser Glass Lewis & Co. has released a report that’s highly critical of Toshiba Corp.’s board for its oversight of multiple scandals. Glass Lewis recommends investors vote against all directors at the company’s shareholders meeting later this month.
REPUTATION
Google acts vs. terrorist videos. Reuters reports Alphabet Google will introduce additional measures to find and take down terrorist or violent extremist content on its YouTube platform.
RISK
U.K. finance chief plays down Brexit shift. U.K. Treasury chief Philip Hammond sought to pour cold water on any notion that the ruling party’s recent election setback could change Britain’s negotiating stance in the coming Brexit talks, saying the U.K. would “definitely” leave the European Union’s single market and customs union, the WSJ reports. With the first round of negotiations between the EU and the U.K. set to begin Monday, Mr. Hammond also struck a defiant tone against Brussels’s financial demands, accusing it of “egregious” posturing.
Tech execs feel need to meet Trump. Technology executives at odds with the Trump administration see a bigger problem than attending a White House brainstorming session Monday—not attending, the WSJ reports. Silicon Valley has been among the most vocal critics of President Donald Trump over his positions on issues such as climate change and immigration. Still, representatives from Apple, Amazon.com, Microsoft and Alphabet Inc.’s Google, companies that have opposed his policies, are expected to make the cross-country trip to ensure their voices are heard.
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