WSJ : Federal Lawsuit Points to Payments’ Future

Federal Lawsuit Points to Payments’ Future
The Justice Department’s suit against Visa’s Plaid acquisition has implications for investors across the entire payments industry

The Justice Department’s lawsuit against Visa V 0.42% isn’t just relevant reading for Visa investors, but for investors across the payments sector.

At the heart of the suit is the future of payments in the U.S. Among the government’s allegations is that Visa saw a potential pay-by-bank offering from Plaid as a competitive threat to debit cards, so it moved to eliminate this risk by acquiring the company. Visa in response said that its business “faces intense competition from a variety of players” but that “Plaid is not one of them,” and the lawsuit is “legally flawed and contradicted by the facts.”


network like Visa or Mastercard. Today such transfers may be familiar to consumers in some realms, such as paying bills online with checking accounts. But they aren’t yet typically an online shopping payment option for consumers, at least not directly.

The realm of digital bank-to-bank, non-card transfers is evolving rapidly. Banks in 2017 launched a real-time payment network via The Clearing House to speed up and fully digitize bank-to-bank transfers. For consumers, this can be used for things like Zelle person-to-person transfers and online bill payments, but it isn’t yet being rolled out as a way to pay merchants directly when shopping online. Mastercard acquired a technology firm called Vocalink that provides infrastructure for real-time payment networks.

Banks might not necessarily have a big incentive to move payments away from debit cards, as they issue the cards and collect fees when they are used. Still, they evidently see benefits in using their own rails for at least some portion of digital payments.

Separately, the Federal Reserve is in the process of launching its own real-time payment network. The network is years away from launching, and exactly whether or how it might be used for consumer-to-merchant payments isn’t clear yet. But certainly that has been the hope of some retailers that aim to save on fees paid to accept card payments.

Already there are digital wallets, which sometimes function as ways to use cards. The Justice Department referred to PayPal and Visa’s partnership, in which PayPal agreed to give equal priority to cards and bank transfers to fund its digital wallets. Still, as consumers use wallets like Venmo or Square’s Cash App increasingly to collect and manage cash and then use that cash to pay at merchants, they represent a non-card way to pay, too.

Wallet providers now often offer debit cards as well. Likewise, buy-now pay-later buttons that consumers see in the checkout cart can represent non-card payment options but can also be ultimately paid by debit transfers.

Whether debit versus pay-by-bank is a sound framework for an antitrust case will be debated in court. The U.K. approved the merger with Visa, in part citing competition among firms similar to Plaid. Visa argues that its deal with Plaid, which it says is a data network and not a payments company, brings “more choice for consumers.” In any event, investors should keep an open mind to a possible payments future beyond cards.

WSJ : PPP Was a Fraudster Free-for-All, Investigators Say

PPP Was a Fraudster Free-for-All, Investigators Say
Reports of fraud, waste and abuse in Paycheck Protection Program inundate government watchdogs, federal prosecutors

WASHINGTON—The federal government is swamped with reports of potential fraud in the Paycheck Protection Program, according to government officials and public data, casting a shadow on one of Washington’s signature responses to the coronavirus pandemic.

Congress and the Trump administration designed the PPP to give small businesses fast and easy access to taxpayer funds, and it worked: About $525 billion in loans were distributed to 5.2 million companies between April 3 and Aug. 8. Many business owners say it was a lifeline in turbulent times.

But evidence is growing that many others took advantage of the program’s open-door design. Banks and the government allowed companies to self-certify that they needed the funds, with little vetting.

The Small Business Administration’s inspector general, an arm of the agency that administers the PPP, said last month there were “strong indicators of widespread potential abuse and fraud in the PPP.”


The watchdog counted tens of thousands of companies that received PPP loans for which they appear to have been ineligible, such as corporations created after the pandemic began, businesses that exceeded workforce size limits (generally 500 employees or fewer) or those listed in a federal “Do Not Pay” database because they already owe money to taxpayers.

Tens of thousands of organizations also appear to have received more money than they should have based on their headcounts and compensation rates, it said.

The Treasury Department in September received 2,495 suspicious activity-reports involving business loans from banks and other depository institutions, more than the total for any year dating back to 2014, according to public data.

One type of suspicious activity banks reported were multiple government payments from coronavirus-relief programs to a single account, suggesting potential abuse, according to Kenneth Blanco, director of the Treasury Department’s Financial Crimes Enforcement Network.

The fraud is sometimes abetted by online vendors that sell a kind of how-to guide for ginning up a fraudulent application for the program, offering “data, instruction, and complete packages of PII,” or personally identifiable information, Mr. Blanco told a group of anti-money-laundering experts this fall.

Several hundred PPP-related investigations have been opened, involving nearly 500 suspects and hundreds of millions of dollars of loans, according to the Federal Bureau of Investigation.

The Justice Department has charged 73 defendants in PPP-related fraud cases, a spokesman said late last month. Many involve allegations of made-up companies or forged documents. The spokesman declined to comment further.

Many other PPP loans are falling into a gray area in which businesses received one despite seeing revenue increase during the pandemic. Prosecutors are probing some of those cases but finding it difficult to bring charges, in part because Congress set a low bar for obtaining the funds, according to law-enforcement officials familiar with the matter.

Prosecutors face hurdles in proving business owners lied when they said they needed money in the pandemic’s chaotic early days—even if profits kept coming in later, officials said.

The CARES Act, the March law that established the PPP, effectively used the honor system. If a company had fewer than 500 employees and certified “current economic uncertainty makes this loan request necessary to support the ongoing operations,” it was generally approved.

At the PPP’s peak, the SBA approved about 514,000 loans on a single day, May 3.

“They don’t charge mistakes. They charge intentional lies,” said Tarek Helou, a former Justice Department prosecutor who is now a partner at Wilson Sonsini Goodrich & Rosati. Given the limited criteria Congress set for the program, he said, “The scandal is what’s legal, not what’s illegal.”

The Justice Department has said it anticipated fraud in the program, creating a PPP-focused team the day it was established and using data analysis to bring cases within weeks.

A spokesman for the SBA said that both it and the Treasury Department “are committed to working with federal partners to ensure PPP funds are used in accordance with the program’s intent.”

Some Democratic lawmakers and others have voiced concerns that the SBA’s refusal to release the names of all borrowers would make detecting fraud more difficult.

That issue might have been resolved last week, however, when a federal judge sided with news organizations including Dow Jones & Co., publisher of The Wall Street Journal, that argued the SBA was legally required to disclose the borrowers.

The SBA, which had previously identified only the companies taking out loans of $150,000 or more, was ordered to comply by Nov. 19.

The Trump administration has said the program helped businesses retain tens of millions of jobs. After some organizations received PPP funds even though they had other sources of cash, the agency promised to audit larger loans and tightened eligibility criteria.

The government’s ability to follow up on allegations of PPP misdeeds will affect how much the program costs taxpayers. The SBA is now accepting loan-forgiveness applications, which are largely expected to be approved if companies can show the money was spent mostly on payroll. The business’ revenue isn’t a factor.

The SBA and the Treasury Department, which has helped run the program, say they intend to focus their audit on loans exceeding $2 million. There are about 29,000 loans of that size, representing less than 1% of total loans and about 20% of the total amount lent, according to SBA data.

The administration hasn’t detailed its plans to conduct the audit and mitigate fraud, the Government Accountability Office, a federal auditor, has said.

“With the passage of time it becomes much more troubling when the fraud framework is not in place,” said William Shear, director in the GAO’s financial market and community investment team, at an Oct. 1 hearing before the House Small Business Committee. “There are too many questions that go unanswered.”

The PPP stopped accepting new applications Aug. 8, but Congress is considering approving another round of funding, and fraud reports could be a factor.

Treasury Secretary Steven Mnuchin and others have said the PPP helped retain as many as 50 million jobs, citing loan applications from businesses that received funding.

Researchers at the Massachusetts Institute of Technology in July compared payroll data at PPP-eligible companies to ineligible ones and estimated the program had boosted employment by about 2.3 million jobs. At that rate, the PPP would have cost about $224,000 per job supported.

“It seems that a lot of that cash went to businesses that would have otherwise maintained relatively similar employment levels,” said David Autor, an MIT economics professor and one of the study’s authors.

One proposal offered by Senate Republicans would allow many businesses to apply for a second PPP loan, with a catch: Their gross receipts must have dropped at least 35% between one of the first three quarters of 2020 and the same quarter last year. A majority of the Senate voted against moving forward with a bill containing those provisions on Oct. 20, but the proposal could resurface as negotiations continue.

FT : EPhilippine authorities investigate transactions for links to Wirecard

Philippine authorities investigate transactions for links to Wirecard
Manila probes law office and tour operator over possible ties to collapsed payments firm

Philippine authorities are probing the financial transactions of a law office and a tour operator for possible connections to Wirecard, the collapsed German payments firm, and its former chief operating officer Jan Marsalek, a government official said.

Menardo Guevarra, the Philippine justice secretary, also said on Sunday that three immigration officials were formally charged and “preventively suspended” for 90 days last month in connection with the missing Austrian executive’s travel records, which falsely showed him entering and leaving the south-east Asian country in June. 

“I confirm that our National Bureau of Investigation has been examining the financial transactions of a certain law office that appears to have provided legal services to Wirecard/Jan Marsalek, and financial records of a tour operator owned by persons with business connections with Wirecard/Marsalek,” Mr Guevarra told the Financial Times in a text message. 

Mr Guevarra said he expected the probe to be finished by the end of the year, but declined to provide the names of the companies under investigation, saying the information could compromise the probe if it was prematurely disclosed.

“We shall provide more details after the NBI has completed its ongoing investigation, with the co-operation of the [Philippines] Anti-Money Laundering Council,” Mr Guevarra said. 

Wirecard plunged into insolvency in June after acknowledging that €1.9bn was missing from its accounts, in one of Germany’s biggest business failures in decades. The company’s Asian headquarters are in Singapore, but the Philippines was a principal location for its partner businesses in the region.

The missing money was purportedly held in escrow accounts by two banks in the Philippines: BDO Unibank and Bank of the Philippine Islands. Benjamin Diokno, governor of the Philippines central bank, has said the money never entered the country while the lenders themselves said documents claiming the money was held on account with them were fraudulent.

Philippine regulators in June launched an investigation into Wirecard’s local partner businesses. It includes Centurion Online Payment International, PayEasy Solutions and ConePay International, which were among those identified in an FT investigation last year that appeared — on paper at least — to do substantial business with Wirecard.

PayEasy’s offices doubled as headquarters of Froehlich Tours, a bus and coach rental business that operates across the Philippines.

PayEasy and Froehlich were both linked to Christopher Bauer, a German former Wirecard Asia-Pacific executive who was reported dead in Manila in late July, a month after authorities announced he was under investigation over Wirecard’s collapse.

Mr Marsalek disappeared in the run-up to the company’s implosion. Interpol added the executive to its “red list” of fugitives wanted for prosecution in August to face charges of violating Germany’s securities and securities trading laws, serious fraud and breach of trust.

Philippine immigration records showed that Mr Marsalek flew to Manila on June 23, then left for China on June 24 from the central city of Cebu. However, Philippine authorities later concluded he never entered the country, after examining CCTV footage, airline manifests and other records. 

Singapore in September ordered Wirecard to cease payment services in the city state, which is probing the company and parties linked to the payments processor.

FT : EU debates hitting Airbnb with tougher regulation

EU debates hitting Airbnb with tougher regulation
Officials are considering rules that would class the online accommodation platform as a ‘gatekeeper’

The EU is debating guidelines that would classify the accommodation booking company Airbnb as a “gatekeeper” platform, paving the way for much stricter regulation under its new Digital Markets Act.

As they prepare to introduce the first big overhaul of regulations for internet companies in two decades, officials in Brussels are discussing the criteria to judge which online platforms are “gatekeepers”, such as their revenues and user numbers.

Officials are still unsure, however, whether to adopt a narrow set of criteria to capture just the biggest platforms, such as Google and Amazon, or whether to apply the definition to as many as 20 companies.

Two people with direct knowledge of the discussions said Airbnb’s inclusion on the list was a “real possibility” because of its large share of the short-term rentals market. Booking.com, Airbnb’s rival, may also be classed as a “gatekeeper”.

More than half of homes which offer short-term stays are listed on Airbnb, compared with 37 per cent on Booking.com and 22 per cent on Expedia, according to figures from the analytics company Transparent, which analyses global holiday rental listings.

Companies classed as gatekeepers by the EU may face regulations to force them to share their customer data with smaller rivals and to ban them from giving preferential treatment on their platforms to their own products and services.

The hotel industry, already in disarray because of the disruption to global travel from the coronavirus pandemic, has stepped up its lobbying campaign for more regulation of online booking platforms, such as Airbnb and Booking.

“We want a level playing field in an environment where things are extremely difficult,” said one senior hotel industry executive.

Jacques Lovell, public affairs manager at Hotrec, the trade body for hotels in Europe, which has been at the forefront of the lobbying efforts, said that Airbnb’s dominant position in the short-term rental market meant that he assumed it would fall under the EU’s new “gatekeeper” rules: “When we say short-term rental, we say Airbnb, which I think says it all.”

A draft of the new Digital Markets Act is expected to emerge in early December.

Airbnb, which is gearing up for a multibillion-dollar public listing before the end of the year, said: “Travel is a competitive industry and we do not believe that Airbnb, or the sectors in which we operate, raise the concerns that the commission has identified with other companies. Competition in travel has brought significant benefits to European consumers in terms of choice, access and lower prices.”

FT : Private equity firms circle Reebok

Private equity firms circle Reebok
Permira and Triton consider move for US sports outfitter that would mark end of awkward relationship with parent Adidas

Private equity firms have been circling US sports outfitter Reebok, according to people familiar with the matter, as the brand’s corporate parent Adidas looks to untether itself from the long-term, awkward relationship with its subsidiary. 

Permira and Triton have considered a move for Reebok, the people said, though they warned that any plans were in the early, exploratory stages and there was no certainty that an offer from either firm would materialise.

Part of the appeal of Reebok to potential bidders was its deep archive of classic footwear and apparel styles and the potential to draw on demand among younger consumers for 1980s-style retro trainers, raising their profile worldwide, one of the people said.

Those assets are also a source of concern for Adidas, whose executives are wary of spinning out a potential rival.

“The thesis [for private equity groups] will be, they can manage and grow this business better than what it is right now, which is just another brand within a relatively broad portfolio,” the person said.

The interest in the brand comes as Adidas continues to evaluate its options for Reebok, which the German sportswear maker acquired more than a decade ago but which has since failed to boost the group’s overall sales.

“Overall as a company, we are not happy with the 2 per cent [sales] growth in 2019,” said Adidas chief financial officer Harm Ohlmeyer in March. “That is not according to our ambitions.” 

A potential sale of the brand, acquired in 2006 for $3.8bn and which recorded just €1.7bn in revenues last year, would mark the end of one of the most costly and ill-suited pairings in the history of the sports gear industry. 

Triton and Permira declined to comment. Adidas said it did not comment on rumours.

Over the years, Adidas management had discussed the possibility of selling Reebok, assessing whether potential financial benefits outweighed the spin-off risk, another of the people said.

Adidas launched a turnround of Reebok four years ago and previously said it aimed to have Reebok on a path to profitability by this year. 

Adidas is expected to lay out its next five-year strategy plan in March, by which time chief executive Kasper Rorsted will want to have a plan for Reebok to present to investors, who have long desired a sale of the subsidiary, one of the people said. 

Adidas acquired Reebok in the hopes of improving the German brand’s market share against worldwide industry leader, Nike, but the merger was hobbled with challenges from the start.

The two brands ended up in an awkward and uneven relationship, with Reebok relinquishing to Adidas some of its core marketing assets, such as outfitting rights to the National Basketball Association, and struggling to carve out a sales niche of its own.

The Reebok brand has undergone several restructurings over the years, but still remains just a fraction of the Adidas group’s overall revenues: its 2019 sales made up just 7 per cent of Adidas’s €23.6bn total for the year.

Boston-based Reebok became popular for its aerobics and fitness shoes targeted at women, and eventually became a prominent professional sports outfitter, signing deals to provide uniforms to the American National Football League and signature shoes to basketball stars like Shaquille O’Neal and Allen Iverson.

London-based Permira has a record of buying footwear and apparel brands. It owns Dr Martens, maker of classic punk-style boots, and in February paid €1.3bn to acquire trendy footwear brand Golden Goose, whose distressed trainers sell for as much as £1,000. 

A potential bid for Reebok would be more of a departure for Triton, which invests primarily in European companies and mostly has portfolio companies in manufacturing, healthcare and business services.

Germany’s Manager Magazin earlier reported that Adidas was exploring a sale for Reebok.

Barrons : Danone Is Shaking Things Up. That May Give Investors an Appetite for t

Danone Is Shaking Things Up. That May Give Investors an Appetite for the Stock.

French food group Danone has struggled through the coronavirus crisis. With restaurants and hotels closed, fewer consumers are swigging its Evian and Badoit waters or its yogurt drink Actimel.

Danone (ticker: BN.France), which competes with Nestlé (NESN.Switzerland) and Unilever (UN) and also makes Horizon dairy products and Silk plant-based drinks, has seen its shares tumble about 33% to 49.47 euros ($58) over the past year, compared with a 2.6% gain for Nestlé and a slight decline of 0.3% for Unilever.

In a third-quarter update, Danone overshot analyst forecasts for a 2.2% drop in sales, falling 2.5% instead. Consumers generally have been switching from expensive brands to cheaper alternatives, and supply chains have been disrupted by the shutdown in foreign travel.

An investment would be brave given that it’s hardly a seismic restructure or anything like the portfolio overhaul seen at Nestlé. Its Swiss competitor has benefited from bringing in an outsider CEO, Mark Schneider, to push for change.

Despite this, John Baumgartner, an analyst at Wells Fargo Securities, forecasts that the shares could rise about 50% to €72. RBC Capital Markets has set a price target of €63. Bruno Monteyne, an analyst at Bernstein, set a more muted €53 target price.

Danone has a market value of €30.7 billion, fetches 13.7 times this year’s expected earnings, and is valued in line with its peers. In February, the company posted income before taxes of €2.8 billion for 2019, up from €2.3 billion in 2018. Total sales for 2019 were €25.2 billion.

In an October statement, CEO Faber said the review and management restructuring “will increase our focus on delivery [and] immediately reap the synergistic benefits, from a growth and efficiency perspective, of our unique and cohesive portfolio of health-related categories.”

Bernstein’s Monteyne said the results of a survey it conducted in late October showed that 83% of 31 institutional investors think Danone’s current portfolio requires significant change and only 10% are happy with current management. Despite the negativity, the respondents think the market outlook for the stock’s near-term prospects “are finely balanced.”

A Danone spokesperson responded in an email that the company reiterates that it has a clear plan to reshape its organization and review its brands.

The business traces its roots to 1919, when Greek entrepreneur Issac Carasso moved to Barcelona and set up a yogurt factory. He had been inspired by the work of scientists from the Pasteur Institute, who treated intestinal infections with yogurt. The company’s name came from a nickname for his son Daniel. In 1973, the firm merged with publicly listed bottle maker BSN.

In the current climate, Danone’s focus on health and wellness is a good space to operate in. Chief financial officer Cecile Cabanis is being replaced in February after five years in the role, and her replacement is an internal appointment, as are two newly created senior roles.

Danone’s review of its Argentina business and Vega, its plant-based North American brand, is a start, but Faber said there would be “no stone left unturned.” The two businesses account for about 2% of group sales.

If the CEO is able and willing to make significant portfolio changes, it might help stem the stock’s decline.

>>> Barron’s Weekend Summary

Barron’s Weekend Summary: A divided government with Joe Biden in the White House and Republicans holding the Senate should be good for markets

* Cover Story: Joe Biden, a politician investors mostly liked in the 1990s and 2000s because of his ability to reach across the aisle, his belief in incremental change, and his support for legislation considered favorable to Wall Street, is likely to be the next president, but Democrats probably won’t take the Senate, leaving a divided government; This scenario “has historically been good for markets, with the S&P 500 rising 60 percent on average during periods when neither party had full control, according to Yardeni Research. Under Democratic control, the index has risen 56 percent; under Republicans, it has risen 35 percent.”

* Tech Trader: Though Proposition 22 in California has been called a victory for Big Tech, it lost by a 60/40 margin in San Francisco, where the companies behind it—UBER, LYFT, DoorDash, Instacart, and Postmates—are based, and was defeated in Santa Clara and San Mateo counties, a sign nobody viewed it as a referendum on the tech industry.

* Trader: Corporate America appears to be getting ready for a stronger economy, regardless of who wins the election—during the first half of the year, cash spending by S&P 500 companies has held up much better than expected, says Goldman Sachs strategist David Kostin; BIIB’s Alzheimer’s drug may get FDA approval, but even with that it could take time for the drug to catch on, largely because the regular testing, monitoring, and space needed to receive it is difficult in a Covid-19 environment.

* Interview: Cornerstone Macro’s Andy LaPerriere, a seasoned observer of US elections, discusses what to expect from the executive branch in 2021, and says that while Joe Biden would be open to compromise with Republicans, the universe of things that you could get bipartisan agreement on is pretty limited.

* Profile: Joanna Jonsson and Robert Lovelace, co-managers of the American Funds New Perspective fund, seek out multinational companies where a significant portion of business is done outside of their home countries; The fund’s structure gives the seven managers autonomy in their investment decisions, and they work closely with analysts who have deep knowledge of their respective sectors (top 10 holdings: TSLA, AMZN, FB, MSFT, TSM, ASML, MA, GOOGL, NFLX, PYPL).

* Features: 1) Positive on APO: Despite growing concern about co-founder Leon Black’s ties to convicted sex offender Jeffery Epstein, shares look attractive at a recent $41, given the firm’s expanding asset base, earnings growth, and investment trends that favor alternatives managers—and the firm could continue to thrive even without Black at the helm; 2) Stocks have rallied on early indications of a split Congress that would reduce the likelihood of sweeping regulatory and tax changes, but political uncertainty remains, and the best approach for investors “may be a portfolio that doesn’t pick sides—growth or value, in this case—and includes a small buffer for the unexpected”; 3) Cautious on CMPS, Mind Medicine, Field Trip Health: Companies are among those developing psychedelic drugs for therapeutic reasons, especially in the area of depression, but it’s unclear just what role they will play in the larger medical industry, and how the newly public companies will make a profit; 4) Positive on VAC: The pandemic has hammered the business travel sector, but the timeshare business continues to benefit from the resiliency of leisure travelers, many of whom drive to vacation spots; Marriott Vacations Worldwide has a premium valuation, but it’s well positioned to get through the pandemic.

* European Trader: Positive on Danone: The Food giant has struggled during the pandemic, partly because of its strong reliance on restaurants and hotels, but chief Emmanuel Gaber has been diversifying the company away from the slow-growth dairy business, and a strategic review of its brands coupled with a management shake-up could spark a turnaround for the stock.

* Emerging Markets: A divided US government will constrain Democratic instincts to raise taxes on corporations and capital gains, benefiting equities, but that’s not the case in emerging markets, where uncertainty could push up the dollar and harm their economies, though improved US trade policy under Joe Biden could improve some countries’ prospects.

* Commodities: “The US presidential election has been more of a distraction than a direct influence on the moves for gold. Expect the precious metal to be a winner no matter the outcome.”

* Streetwise: “The bottom line is that tech has been both a bull- and bear-market play,” says Jim Paulsen, chief investment strategist of the Leuthold Group, and Terry Sandven, chief equity strategist at US Bank Wealth Management, sees the pattern continuing; Tech’s weighting in the S&P 500 has swelled, sparking concerns among investors, but the trend is merely a sign of tech’s increased involvement in people’s lives.

WSJ : A Guide to Recount Rules in Competitive Election 2020 States

A Guide to Recount Rules in Competitive Election 2020 States
Several states have close vote margins between President Trump and Joe Biden, and each has its own rules for when a recount happens

Joe Biden has been declared the winner of the presidential election. Still, he and President Trump are locked into tight contests in more than a half-dozen battleground states, making it likely that one campaign or the other will request a recount once results are fully tabulated.

Mr. Trump’s campaign has said it will request a recount in Wisconsin, where unofficial totals show him trailing by around 20,000 votes and where the Associated Press has called the race for Mr. Biden. Mr. Biden’s margin there is around 0.6 percentage point, within the one-point margin necessary for a campaign to request a recount. They are also closely contesting Georgia, where Biden leads by less than 10,000 votes and where the state’s top election official has said the votes will be recounted.

Rules for recounts vary by state. Here is a breakdown of those procedures in the most competitive contests.

Arizona
Campaigns can’t request a recount, they can only be triggered automatically when there is a margin of less than or equal to 0.1 percentage point.

Georgia
Razor-thin margins in this state make a recount highly likely. Candidates can request a recount if the margin is within 0.5 point, and the state’s top election official said Friday a recount is coming. The request has to happen within two business days after the state certifies the election results. The certification deadline is Nov. 17.

Michigan
A recount situation is unlikely here because state law stipulates that automatic recounts only occur if there are less than 2,000 votes separating candidates. As of Thursday afternoon, Mr. Biden led by more than 146,000 votes.

Nevada
Campaigns can request a recount regardless of vote margin within three days of the state canvass, which must be completed within six “working days” of the election. The recount must be completed within 10 days of the request. The campaign requesting the recount must pay for it.

North Carolina
Campaigns can request a recount if a race has a margin of 0.5% or less, and it must be requested by noon of the second business day after the state canvass, which happens three weeks after the election. A recount must be completed within approximately five days of the request, though that is subject to the decision of the State Board of Elections.

Pennsylvania
There are mandatory recounts for any race that has a margin of 0.5% or less that must be completed within three weeks of an election. The 34,000-vote lead Mr. Biden held when the race was called Saturday was just outside that margin. Campaigns can also request recounts, no matter the margin, within five days of canvass completion.

Wisconsin
Vote margins must be within 1 percentage point for a campaign to request a recount. There are no automatic recounts in the state, and the campaign that requests it must pay for it. It must be completed within 13 days of the formal recount order. The request must be submitted within three days of the state’s official county canvass.