For all its tough talk against Russia, the UK’s government is failing to enforce its promises to clean up dirty foreign money, a hard-hitting report by MPs said Thursday.
It was “shameful” that after years of warnings, the government only began to clamp down on the illicit flows when Russia invaded Ukraine in February, the report by the House of Commons Foreign Affairs Committee said.
The government has brought in new legislation to prevent corrupt funds being laundered through Britain’s property market.
But it has failed to back this up with enough resources or powers for anti-corruption bodies such as the National Crime Agency and Serious Fraud Office, the report said.
“Without the necessary means and resources, enforcement agencies are toothless,” it said.
“The threat illicit finance poses to our national security demands a response that is seen to be serious.”
Rich Russians have long found it easy to acquire expensive properties in London, or a world-class education for their children in Britain’s private schools, or control of Premier League football clubs.
According to multiple studies into the “Londongrad” phenomenon, they were enabled by a service industry encompassing blue-chip bankers, accountants, lawyers, property agents and public relations advisors.
And since Prime Minister Boris Johnson entered Downing Street in 2019, his Conservative party has stepped up a drive to entice cash-rich donors, including from wealthy backers originally from Russia.
Following the invasion of Ukraine, Johnson’s government has sanctioned dozens of wealthy, Kremlin-connected Russians and says their money is no longer welcome in Britain.
However, according to the MPs, “corrupt money has continued to flow into the UK”.
The committee called for the government to publish a review into a “golden visa” programme that enabled thousands of Russians to establish residency, or even citizenship, in Britain from the 1990s.
The scheme only ended in the week before Russia invaded Ukraine, and the report demanded to know what the government intends to do about Russians who obtained visas “without due diligence”.
One beneficiary of the scheme was the sanctioned oligarch Roman Abramovich, who has been forced to sell Chelsea football club.
Johnson meanwhile is refusing to release intelligence advice he received about his controversial appointment of Evgeny Lebedev, a Russian-born newspaper baron, to the House of Lords.
“The UK’s status as a safe haven for dirty money is a stain on our reputation,” the Foreign Affairs Committee’s Conservative chairman, Tom Tugendhat, said.
“The government must bring legislation in line with the morals of the British people and close the loopholes that allow for such rife exploitation,” he said.
Musk, Twitter get Oct. 17 trial in buyout fight
Twitter’s lawsuit to force Elon Musk to complete his $44 billion buyout bid is set to go to trial on October 17, a US judge has ordered, in a case with major stakes for both sides.
The trial is due to open in a court in the eastern state of Delaware and is set to last five days to decide whether Musk can walk away from the deal.
The Tesla boss wooed Twitter’s board with a $54.20 per-share offer, but then in July announced he was “terminating” their agreement on accusations the firm misled him regarding its tally of fake and spam accounts.
Twitter has countered by saying Musk already agreed to the deal and can’t back out now.
An order from the judge handling the case, Kathaleen McCormick, lays out an expedited schedule to resolve a fight that has left Twitter in limbo.
She reminds both sides that they “shall cooperate in good faith” on matters like handing over information to each other, a key topic that can result in delays.
Billions of dollars are at stake, but so is the future of Twitter, which Musk has said should allow any legal speech — an absolutist position that has sparked fears the network could be used to incite violence.
Twitter blamed disappointing results last week on “headwinds,” including the uncertainty imposed on the company by Musk’s chaotic buyout bid.
What’s with the slowdown in Canada’s tech ecosystems this year?￼
Canadian venture funding cooled in Q2 2022, but Alberta is still seeing record-level funding.
As BetaKit reported at the end of 2021, that year was “undoubtedly a landmark year” for Canada’s tech scene. The sector broke an all-time venture capital funding record previously set in 2019, with firms raising a staggering $11.8 billion in Q3 alone.
So what’s with the slowdown this year?
BetaKit is reporting that the BC, Waterloo Region, and Toronto tech sectors are all showing signs of cooling in Q2, as tracked by briefed.in.
On the west coast, BC’s venture funding and deal volume dropped to a six-quarter low, with startups raising $204.3 million collectively — a decrease of 62% compared to Q1 2022. Toronto saw a 69% drop from Q1 — a fairly dramatic drop after the banner year that was 2021.
Waterloo is a bit of a different story. While the region did see its lowest quarter for deal volume in three years, there was still an increase in investment over Q1. That said, most of this (96% according to BetaKit) was from one $537.7 million Series G extension closed by Faire, a retail startup.
The one Canadian ecosystem that’s still flying high? Alberta. In Q2, companies raised $268.6 million through 12 deals – a 31% increase quarter-over-quarter, BetaKit reports. It remains to be seen if they’ll be hit with the same cooling as other ecosystems.
Speaking to BetaKit, Golden Ventures partner Ameet Shah explained “if 2021 was the party, then 2022 stands to be a sobering experience for founders, employees, and investors alike.”
What contributed to this slowdown? Unsurprisingly, stock market slumps, the cryptocurrency rollercoaster, inflation, and overseas conflict all play factors in the current volatility. After the booming decade of the 2010s, this year seems to be an overall bust for the global tech sector, including Silicon Valley, with repeated announcements of layoffs.
According to global labor trends aggregator Layoffs.fyi, 140,388 workers lost tech jobs since the start of the COVID-19 pandemic, as reported by BNN Bloomberg.
The Canadian tech sector is also facing layoffs — including the news that Shopify is letting go of approximately 10% of its workforce. Back in June, Wealthsimple laid off 13% of its staff.
As Deena Shakir, a partner at Silicon Valley-based VC firm Lux Capital explained to CBC News at June’s Collision Conference, “right now everyone who is innovating and/or investing in tech or in startups is trying to understand what exactly is happening in this moment.”
“We’re the topic of conversation at every partner meeting, and every lunch and coffee.”
DX Journal covers the impact of digital transformation (DX) initiatives worldwide across multiple industries.
Sony trims annual profit forecast after Bungie purchase
Sony trimmed its annual net profit forecast on Friday, partly due to acquisition expenses including the purchase of US game studio Bungie, creator of hits like “Halo” and “Destiny”.
The PlayStation maker announced in February it would buy Bungie for $3.6 billion, weeks after rival Microsoft unveiled a landmark pact to acquire “Call of Duty” maker Activision Blizzard.
Microsoft says its massive merger, valued at around $69 billion, will make it the third-largest gaming company by revenue, behind Tencent and Sony — marking a major shift in the booming gaming world.
Sony Group now predicts net profit for 2022-23 will total 800 billion yen ($6 billion), down from the 830 billion yen previously forecast.
It said the expected increase in acquisition expenses was “mainly due to the acquisition of Bungie, Inc. being completed earlier than the assumed timing”.
Lower sales of games by non-house developers will likely dent its overall sales figures this financial year, it said, but this would be “partially offset” by a weaker yen.
Exchange rates also boosted the conglomerate’s movie segment, chief financial officer Hiroki Totoki told reporters.
Customer traffic at US theatres has returned to pre-pandemic levels in some weeks, and Sony Pictures is hoping to score another box-office win after the runaway success of “Spider-Man: No Way Home”.
“We have high hopes for ‘Bullet Train’ featuring Brad Pitt,” Totoki said.
The movie division expects higher sales for anime streaming, “including the impact of the acquisition of Crunchyroll”, the world’s largest online library of Japanese animation.
– PlayStation 5 sales steady –
In the April to June quarter, the Japanese conglomerate posted a three percent year-on-year rise in net profit to 218 billion yen, with sales up around two percent to 2.3 trillion yen.
Sony has faced challenges rolling out its PlayStation 5 console, which remains difficult to get hold of more than 18 months since its launch in November 2020, in part due to pandemic supply chain disruption and the global chip shortage.
Sony sold 11.5 million PS5s last year, and in May Totoki said the firm was adapting to try and weather ongoing supply chain issues, including Covid-19 lockdowns in China.
For the PS5, “the problem is more about supply than demand. The company is also facing problems transporting its products,” Hideki Yasuda, senior analyst at Toyo Securities, told AFP before the earnings release.
Meanwhile “the yen has turned lower in this quarter. This should be positive for the company,” he said, adding that a US economic slowdown could open up shipping spots, even though it poses risks overall for businesses like Sony.
In the first quarter of this financial year, Sony sold 2.4 million PS5 units, similar to the same period last year when it sold 2.3 million.
Sony also said last month it is launching a new brand that will offer PC gaming gear.
The gaming peripherals market of items used by players was valued at $3.88 billion globally in 2019 according to Grand View Research.
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