Watchdog Group Launches Investigation Into Biden’s ‘Woke Army’
The Foundation for Government Accountability (FGA) is launching an investigation into a recent executive order the group called an “unprecedented scheme” they believe violates the democratic process.
In a press release, FGA said they are “sounding the alarm” on the “‘woke army’ being assembled inside the federal government,” through Executive Order 14091 (EO), titled “Executive Order Further Advancing Racial Equity and Support for Underserved Communities Through The Federal Government.”
FGA announced that their investigation will include filing Freedom of Information Act (FOIA) requests targeting the 23 agencies addressed in the Equity EO, including the Departments of State, Justice, Defense, Labor, Transportation, Social Security, Education, and Health and Human Services.
The group will share the information they gather with Congress, the states, and the American people, according to their press release.
FGA asserted that the plan (pdf) was developed by a left-wing activist group, and said it was “designed to circumvent the normal, democratic process and instead force their ideology onto Americans.”
Tarren Bragdon, FGA President and CEO said of the executive order, “These equity teams are a Trojan horse planted in the heart of every federal agency to fundamentally change decision-making across the bureaucracy. Their goal is to continuously and permanently embed Left-wing ideology into every agency action.
“We cannot allow this new ‘woke army’ to force un-American philosophy into all corners of our federal government. They will degrade our nation’s capabilities and effectiveness, while undermining our liberty and security.”
“We’ve seen the economic devastation over the first two years of the Biden presidency. If radical ideology is ingrained into every policy and regulatory decision at all agencies, the impact on the American people and economy will be widespread, devastating, and impossible to reverse,” Bragdon added.
Bragdon referenced part of Section 2 of the order, which outlines the requirement that agency heads across the administration ensure they place an “Agency Equity Team” within their agencies to “coordinate the implementation of equity initiatives,” in order to deliver “equitable outcomes” to the American people.
Stewart Whitson, FGA legal director spoke to the issue, saying “The clock is ticking on President Biden’s term. And the radical forces inside his administration and their partners on the outside know they have limited time to embed their ‘leaders and practitioners’ into every federal agency before they lose power. If successful, this ‘woke army’ will outlast the Biden presidency and become a permanent fixture deeply entrenched in our government.”
“Through this investigation, FGA is fighting to expose this attempted ideological takeover of our federal agencies, and we won’t stop until we’ve uncovered the truth. We will share the information we uncover with Congress, the states, and the American people so that, together, we can help stop this unconstitutional effort before it’s too late.”
The White House did not immediately respond to The Epoch Times’s request for comment.
UBS Offers $1 Billion to Buy Credit Suisse
The discussions are part of urgent effort by Swiss and global authorities to restore trust in banking system
UBS UBS -5.50% Group AG has offered to buy rival Credit Suisse CS -6.94% for around $1 billion in a deal engineered by Swiss regulators to restore trust in the banking system, according to people familiar with the matter.
One option would involve buying the entirety of Credit Suisse and then spinning off its local Swiss operations into an independent entity, the people said. UBS would keep Credit Suisse’s valuable wealth-management business.
Discussions are continuing and the contours of the deal could still change as UBS and Swiss regulators hash out details of the plan and to what extent Swiss authorities would provide guarantees or backstops.
Officials are racing to consummate the deal before markets open in Asia, the people said. Regulators have offered to waive a requirement for customary shareholder votes to expedite the sale, one of the people said.
An issue in the discussions is what cost-saving UBS would be allowed to generate by Swiss authorities through moves such as job cuts, a key factor in how much UBS can afford to pay for the deal, the people said.
UBS would only keep parts of Credit Suisse’s investment bank that fill gaps either geographically or in certain product areas where UBS lacks a presence.
The price would be a substantial discount to Credit Suisse’s market value, which closed Friday at around $8 billion. UBS would be taking on large unknown costs and the complexities of integration. Some rich customers keep money at both banks and after a merger might decide to take some of their money to third parties for diversification purposes.
The size of UBS’s offer was reported earlier by the Financial Times.
Credit Suisse’s AT1 bonds are expected to be substantially written down, relieving some of the debt burden UBS would take on, according to some of the people familiar with the matter.
An end to Credit Suisse’s nearly 167-year run would mark one of the most significant moments in the banking world since the 2008 financial crisis. It also would represent a new global dimension of damage from a banking storm started with the sudden collapse earlier this month of Silicon Valley Bank.
Credit Suisse took a more-than-$50 billion Swiss National Bank liquidity lifeline this week after concerns deepened about its prospects. The action didn’t do enough to stop the slide in Credit Suisse’s shares or stem the loss of bank deposits, compelling the central bank and Switzerland’s top financial regulator to orchestrate talks with Credit Suisse’s larger rival, UBS.
The urgency on the part of regulators was prompted by an increasingly dire outlook at Credit Suisse, according to one of the people. The bank faced as much as $10 billion in outflows a day last week, this person said. The regulators feared that the bank would become insolvent next week if not dealt with, and they were concerned crumbling confidence could spread to other banks.
UBS has long been seen as part of any state-backed solution for Credit Suisse, which has a balance sheet roughly half the size of UBS’s $1.1 trillion in total assets. Any full-scale takeover would give UBS prized businesses within Credit Suisse, such as wealth-management clients in Asia and the Middle East, but might come with less desirable units such as Credit Suisse’s troubled investment bank. It also could derail UBS’s existing strategy and perceived stability with investors.
UBS has a market capitalization of roughly $65 billion, versus Credit Suisse’s $8 billion, according to FactSet. It made a $7.6 billion net profit in 2022, while Credit Suisse posted a $7.9 billion net loss.
Credit Suisse’s local retail bank, a sticking point in the talks, could on its own be worth $10 billion, according to analysts. Combining it directly with UBS would create a domestic- banking behemoth with around 30% of the country’s domestic loans and deposits.
Credit Suisse’s large legal bills are expected to be backstopped by the Swiss government and moved to a separate entity, according to one of the people.
The bank’s legal costs spiraled in recent years from banker misconduct and regulatory settlements. It estimated in February that it could have to pay up to around another $1.3 billion not accounted for. It also faces other litigation, such as around investment funds it ran with collapsed financing partner Greensill Capital.
Another issue is what to do with Credit Suisse’s hobbled investment bank. Credit Suisse was in the early stages of spinning out parts of its investment bank under the name CS First Boston, led by former Credit Suisse board member Michael Klein. It agreed to pay $175 million to buy his company, the Klein Group.
Outside investors had started firming up their likely financial commitments to the CS First Boston venture in recent weeks, according to people familiar with the matter. Swiss regulators are concerned that the plan is too complicated to be a part of the merger, and some potential investors in CS First Boston aren’t willing to rush into any commitments, the people said.
Both Credit Suisse and UBS are deemed systemically important in Switzerland and globally, and a combination could be subject to additional oversight and capital charges. Credit Suisse had around 50,000 employees at the end of 2022, including more than 16,000 in Switzerland. It has investment-banking units in cities including New York, London and Singapore, an operations hub near Raleigh, N.C., and employs thousands in technology in India and Poland. UBS has around 74,000 employees globally.
Any combination likely would result in substantial job losses beyond the more than 9,000 positions Credit Suisse already had promised to eliminate as part of its turnaround plan.
Credit Suisse has billions of dollars in deferred employee compensation and prospective legal settlements, according to its financial statements. In January, it set up a capital-release unit it said would take years to work through.
Credit Suisse’s slide toward state assistance came after other banks and large investors pulled back last week from doing business with the Swiss lender. Other investment firms stopped trading with the bank in the fall, as its yearslong problems got worse, people familiar with the matter said.
Analysts have been concerned about rich customers pulling their money. Executives at other banks said they got inflows from Credit Suisse clients last week.
The impact of a deal on wider financial markets will depend on the details and how much support, if any, regulators provide. Credit Suisse has over $160 billion of long-term debt, some of which is classified as bail-in instruments, which can get wiped out in case regulators force the bank into a restructuring.
Using UBS to save Credit Suisse marks a turnaround from nearly 15 years ago, when Switzerland bailed out UBS after it got stuck with billions of toxic assets in its U.S. business. Credit Suisse declined state aid at the time and emerged from the crisis in stronger shape.
It went on to be battered by stricter financial regulation and costly settlements with regulators. The bank underwent a series of restructurings. Credit Suisse’s latest management team, some who worked previously at UBS, had appealed for more time to prove they could turn things around.
Rolls-Royce closes AI start-up after talks with buyers collapse
Company blames tough economic environment as new boss puts his stamp on engineering group
Rolls-Royce is closing down its artificial intelligence start-up after talks with two potential buyers fell through and as the company’s new chief executive puts his stamp on Britain’s flagship engineering company.
The R2 Factory venture, which celebrated its first anniversary this week, is the first casualty under Tufan Erginbilgic, who took the helm in January with a brief to drive performance and cut costs at the FTSE 100 group.
The company blamed the closure on the “tough economic environment and embryonic nature of the business”, which had made it difficult to secure investment.
Erginbilgic, who described Rolls-Royce as a “burning platform” in a speech to staff in January, has made no secret of his plans to shake up the company, which makes civil engines that power many of the world’s largest aircraft.
The former BP executive almost immediately launched an internal plan to transform the way the company operates and identify potential cost savings across the group.
R2 Factory is an offshoot of R2 Data Labs, Rolls-Royce’s innovation hub to help the company implement advanced data analytics and artificial intelligence across supply chains, fuel efficiency and other areas.
R2 Factory, which is chaired by Rolls-Royce’s chief technology officer Grazia Vittadini, was meant to offer a similar service to large industrial customers.
While an eventual spinout of the business had always been planned, the impending arrival of Erginbilgic was seen as a catalyst for talks with potential buyers to begin late last year, according to people familiar with the venture.
There were also concerns within some circles about the levels of expenditure by R2 Factory on dinners and other hospitality events, the people familiar with the group added.
Styled along the lines of a digital members’ community, R2 Factory was based in an embassy-style townhouse at Portland Place in central London.
The building, said a person close to the business, was a “key part of the identity”, a place to meet and to help attract paying members. It had underspent its budget for 2022, the person added.
Recent clients included pharmaceutical group AstraZeneca, which wanted to improve its data analytics and artificial intelligence capabilities in its factory processes.
The team’s wider work included looking at how to use AI to create more adaptive supply chains and to conduct robotic inspection of components in factories.
The business had been in talks with a private equity backer about a potential management buyout, as well as talking to a competitor about a sale, according to people familiar with the venture.
Staff, who were told this week that the talks had collapsed and the venture was being wound down, were left in shock by the abrupt decision. The company was still hiring new people as recently as two to three weeks ago.
The move puts at risk a 50-strong team of data and software engineers, scientists and support staff and comes as companies are racing to integrate AI technologies into products and services to raise productivity.
Rolls-Royce said: “We have decided to close our digital start-up, R2 Factory. It is a business that was created in 2022 as a non-core innovation opportunity and was designed to be spun out.”
It added it would “endeavour to find redeployment opportunities for our people within Rolls-Royce”.
Casino boss spins wheel yet again in race to save supermarket empire
Jean-Charles Naouri pursues deal with former franchisee as he races to salvage group
The deal Jean-Charles Naouri signed this month to try to save his indebted French supermarket group Casino has roots stretching back almost 30 years to a fateful meeting with a business school graduate.
The man some used to call the “godfather of French retail” had summoned 25-year-old franchisee Moez-Alexandre Zouari, wanting to know how the young entrepreneur’s audacious plan to open 100 stores in apparently saturated city-centre markets could possibly be a good idea.
“I told him I had tested it with my wife, and we figured you need a store every 300 metres or so because city residents can’t carry heavy groceries much farther,” Zouari recalled. Naouri, a trained mathematician, “quickly calculated in his head and saw the opportunity”, and soon invested to help Zouari expand.
Having worked together in different forms ever since, the 74-year-old Naouri is now making another big bet on an idea hatched up by Zouari as the executive tries to save what remains of his once sprawling empire ahead of looming debt repayments next year.
The complex deal would merge Casino’s French food retailers with Teract, a company Zouari founded with two prominent French businessmen via a Spac deal last year. It offers a financial lifeline that also allows Naouri to save face since it is not an outright sale.
Jean-Charles Naouri is part of a generation of French businessmen who have used complex financial engineering to build business empires via debt-fuelled acquisitions © Magali Delporte/FT
The pair’s longstanding relationship may have made Zouari the only person who could convince Naouri to relinquish his grip on Casino, said people close to the deal.
“Until now the other deals Naouri had to choose from were all going to hand him a loss,” Zouari told the Financial Times, referring to approaches by rivals Carrefour and Auchan. “People don’t understand that he is not just a financier, he is very attached to the company he built.”
Naouri, described as prickly and independent by people who know him, has come to trust Zouari. “He has the ability to focus on the details and also has a vision for the future of retail,” Naouri told the Financial Times. “I have a lot of respect for him as a professional . . . and have come to consider him a friend.”
Naouri is part of a generation of French businessmen, including Vincent Bolloré and Bernard Arnault, who have used complex financial engineering to build business empires via debt-fuelled acquisitions. But the retail sector has been decimated over the past decade by ecommerce and price wars, and his business has not generated enough cash to support its layers of debt.
Casino, whose market value has shrivelled to less than €1bn from a peak of €11bn in 2014, has been racing to sell off assets to make debt repayments, including a recent chunk of shares in its listed Brazilian business Assai.
If the deal is finalised, Casino will spin out and combine its French retail operation with Teract, a listed company owned by Zouari, tech billionaire Xavier Niel, banker Matthieu Pigasse and France’s biggest farmers’ co-operative InVivo.
The two sides announced exclusive talks earlier this month but disclosed neither a valuation nor how much of Casino’s debt would be transferred. Teract will inject at least €500mn into the venture.
People familiar with the deal said the combined retail businesses would be placed in one entity, with Naouri as chief executive and Casino owning 60 per cent to Teract’s 40 per cent.
A second entity will act as a central purchasing platform to supply the retail stores with locally grown fruit and vegetables, wine and baked goods via InVivo’s 300,000 farmers. Zouari will lead it, with Teract and its backers owning 60 per cent to Casino’s 40 per cent.
The idea is to create a vertically integrated retailer to appeal to consumers who are willing to pay a premium for sustainable, locally sourced food.
Investors reacted with scepticism on the morning of March 10, hours after the deal was announced and the same day Casino disclosed weak annual results. One hedge fund manager who has been short Casino said the “half-baked deal announcement” was an attempt to distract from the group’s cash burn.
Analysts at Barclays said they “struggle to see the benefits of a potential combination with Teract and remain downbeat regarding Casino’s performances in France”.
But there are likely to be benefits for Naouri, who controls Casino through a series of holding companies that have been in a court-protected debt restructuring process since 2019. Naouri is betting the deal will rejuvenate Casino and stem market share losses, which could help him convince the judges overseeing the holding companies’ restructuring proceedings to give him more time to pay creditors.
Casino faces €1.2bn in debt maturities in 2024 and €1.8bn in 2025. Another €1.9bn is due at holding company Rallye in 2025.
Surprisingly, negotiations on how much of Casino’s debt would be placed on the new retail group proved straightforward because Naouri promised to cap it at two times earnings before interest, tax, depreciation and amortisation, Zouari said. “We thought it would be the toughest part of the talks but in the end it was not.”
Analysts at Bryan Garnier expect €2.2bn of Casino’s secured debt with banks to move to the new venture, and warn that Casino shareholders and unsecured creditors risk losing out. Meanwhile, Teract will be well placed to scoop up assets cheaply should Naouri prove unable to service his debts.
On a more personal level, the transaction could provide Naouri with an answer to the thorny question of his successor. The Casino boss has come to regard Zouari as “a spiritual son”, according to one person who has worked closely with both.
The deal also cements Zouari’s rise to the upper echelons of France’s business world after he and his wife, Soraya, spent decades building their company in the shadow of Casino. Their fortune was estimated at €1bn last year by business magazine Challenges, putting him 113th in France, while Naouri has slipped out of the rankings.
When the Franco-Tunisian entrepreneur hit his pledge of opening 100 Franprix stores after 10 years, Naouri invited him for lunch in the palatial dining room of the exclusive Hotel Bristol. “I wasn’t used to such grandeur,” Zouari recalled.
He went on to became Casino’s biggest and most profitable franchisee, with a peak of about 500 stores jointly owned with Naouri via two companies. Naouri initially bankrolled the expansion in exchange for a minority stake.
In 2019 Zouari started selling some of his shares to Naouri, using the proceeds to diversify his family’s business through acquisitions. The following year he bought a controlling stake in frozen food chain Picard and teamed up with Niel and Pigasse to create the Spac that would become Teract.
When they went to see Naouri as they hunted for its first target, he made it clear he did not want to sell off his company in pieces. Yet when the trio unveiled a deal last year to merge with the retail arm of InVivo, Naouri sent Zouari a congratulatory text.
“He is a man of few words so messages like this are rare,” said Zouari. “I thought he was sending me a subtle message that he was interested in our project.”
It was a hunch that proved correct — about six months later they began negotiating their next joint venture.
FT : UBS offers to buy Credit Suisse for up to $1bn
Swiss authorities expected to change country’s law to bypass UBS shareholder vote
UBS has offered to buy Credit Suisse for up to $1bn, with Swiss authorities planning to change the country’s laws to bypass a shareholder vote on the transaction as they rush to finalise a deal before Monday.
The all-share deal between Switzerland’s two biggest banks is set to be signed as soon as Sunday evening and will be priced at a fraction of Credit Suisse’s closing price on Friday, all but wiping out the target’s shareholders, four people with direct knowledge of the situation said.
The offer was communicated on Sunday morning with a price of SFr0.25 a share to be paid in UBS stock, far below Credit Suisse’s closing price of SFr1.86 on Friday, the people said. UBS has also insisted on a material adverse change that voids the deal if its credit default spreads jump by 100 basis points or more, they added.
The situation is fast-moving and there is no guarantee that terms will remain the same or that a deal will be reached, all the people stressed.
Some of the people said that the current terms were unfair for Credit Suisse and its shareholders. Others criticised the plans to void normal corporate governance rules by preventing a UBS shareholder vote.
There has been limited contact between the two lenders and the terms have been heavily influenced by the Swiss National Bank and regulator Finma, the people said. The US Federal Reserve has given its assent to the deal progressing, they added.
While the current terms value Credit Suisse’s equity at up to $1bn, the figure does not reflect additional provisions the Swiss National Bank will make to ensure the deal is done.
Both sides have been locked in discussions with regulators since Wednesday, when Credit Suisse asked the SNB to provide it with an emergency SFr50bn ($54bn) credit line.
When this backstop failed to arrest a fall in its share price and stop panicked clients from withdrawing their money, the central bank stepped in to force a merger after becoming concerned about the viability of the country’s second-largest lender.
Deposit outflows from Credit Suisse topped SFr10bn a day late last week, the Financial Times has reported. Customers withdrew SFr111bn from the group in the final three months of last year.
On Saturday night, the Swiss cabinet assembled in the finance ministry in Bern for a series of presentations from government officials, the SNB, market regulator Finma, and representatives of the banking sector.
The government is preparing emergency measures to fast-track the takeover and plans to introduce legislation that will bypass the normal six-week consultation period required for UBS shareholders so the deal can be sealed immediately, the people said.
The framework of the deal has been designed by Swiss regulators to provide maximum stability to the country’s banking system, people briefed about the matter said. Swiss authorities have already secured preapproval from relevant regulators in the US and Europe which are expected to issue co-ordinated statements today.
UBS will dramatically shrink Credit Suisse’s investment bank, so that the combined entity will make up no more than a third of the merged group, two of the people said.
However, the current term sheet for the deal does not specify what will happen to Credit Suisse’s individual business divisions, and simply outlines a 100 per cent takeover of the group.
Negotiators have given Credit Suisse the code name Cedar and UBS is referred to as Ulmus, according to people briefed on the matter.
UBS is seeking concessions and protections from the government, particularly from any pending legal cases and regulatory investigations into Credit Suisse that could result in fines or losses, the FT has reported. However, it is unlikely it will get indemnity from any losses on assets, one of the people involved said.
UBS also wants to be allowed to phase in any extra demands it would face under global rules on capital that govern the world’s biggest banks.
The SNB, UBS, Credit Suisse and Finma declined to comment.