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Reports: $1B Fine for Wells Fargo for Illegal Sales

U.S. news reports say Wells Fargo will be fined as much as $1 billion for illegally selling customers car insurance policies they did not want or need, and for charging unnecessary fees in connection with mortgages.

This would be the largest fine ever imposed by federal bank regulators and the Consumer Financial Protection Bureau.

The fine is part of a settlement regulators negotiated with the bank.

Wells Fargo and federal officials have not commented on the reports.

The San Francisco-based lender admitted selling the unwanted insurance policies to hundreds of thousands of car loan customers. In many cases, the borrowers could not afford both the insurance and car payments and their cars were repossessed.

Many U.S. banks have enjoyed looser federal regulations under President Donald Trump’s pro-business administration.

But Trump denied reports that Wells Fargo would not be punished, tweeting in December that fines and penalties against the bank would, if anything, be substantially increased.

“I will cut regs but make penalties severe when caught cheating,” he wrote.

Wells Fargo previously paid a $185 million fine for opening bank and credit card accounts in its customers’ names without telling them.

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North Korea, Comey, Stormy Add to Trump’s Chaotic Week

To some, it may seem like just another week at the Trump White House.

Word of a potentially historic breakthrough on North Korea is forced to compete with a scathing assessment of the president by his former FBI director. Add into the mix, court appearances earlier in the week by his personal lawyer and an adult film actress who claims she had an affair with the president. Who can blame those in Washington who ask: Is this the new normal? Or is it simply the political phenomenon of Donald Trump breaking the mold once again?

For most presidential administrations, the movement toward a summit with North Korea would be enough for a week of headlines.

“It will be a great day for them. It will be a great day for the world,” President Trump told reporters Wednesday on the possibility of a successful meeting with North Korean leader Kim Jong Un.

Trump spoke at a joint news conference with Japanese Prime Minister Shinzo Abe at the president’s Florida resort.

Bad for the country

Just minutes later, Trump made a quick pivot away from the North Korea situation to blasting the Russia probe that continues to cast a shadow over his administration.

“It is a bad thing for our country,” he said. “A very, very bad thing for our country. But there has been no collusion. They won’t find any collusion. It doesn’t exist.”

Throughout the week, the president has also been engaged in a war of words with James Comey, the man whose dismissal from the job of FBI director set in motion the appointment of special counsel Robert Mueller to lead the Russia investigation.

Comey has held a series of interviews for his new book, “A Higher Loyalty: Truth, Lies and Leadership.” Comey told the ABC News network he believes Trump is “morally unfit” to be president.

Mueller’s fate

And speaking to the USA Today newspaper, Comey mused about the possibility that the president could move to fire Mueller and the man he reports to, Deputy Attorney General Rod Rosenstein.

“That is a fundamental attack on the rule of law, so that is the most important thing. All of us should care about that,” Comey said. “Again, this is above politics, above party affiliation because it is all we are as a country.”

During his news conference on Wednesday, Trump was asked about the fate of Mueller and Rosenstein.

“They have been saying I’m going to be getting rid of them for the last three months, four months, five months, and they are still here,” said Trump. “So we want to get the investigation over with, done with, put it behind us.”

Others with the president’s ear are urging him to take action, according to Associated Press White House correspondent Jonathan Lemire.

“There is, though, a team of outside advisers, sort of Trump’s informal kitchen cabinet,” he said. “A number of those people have suggested to him, ‘Hey, you need to be tougher, Mueller is imperiling your presidency and you should fire him.'”

Some Democrats and a few Republicans are pushing congressional leaders to pass legislation that would protect Mueller and Rosenstein. But House Speaker Paul Ryan sees no need for it at present.

“We do not believe that he should be fired. We do not believe that he will be fired and we therefore don’t think that that is necessary,” Ryan told reporters this week.

Stormy weather

Adding to the turmoil this week was the Monday media circus outside a federal court in Manhattan where Trump’s personal lawyer, Michael Cohen, made an appearance along with adult film star Stormy Daniels.

Cohen was the target of FBI raids recently on his office, home and hotel and is under scrutiny for a payment to Daniels.

Daniels claims she had a brief affair with Trump back in 2006, which he has denied, and that Cohen facilitated a payment intended to silence her about the affair.

The ongoing Russia probe combined with Cohen’s legal troubles suggests more uncertainty ahead for the Trump White House.

“We are coming to some sort of a head,” said American University political expert Chris Edelson. “I mean, certainly this Cohen news is a really big deal and maybe we will find out more about that in the not too distant future. But it is hard to say with certainty what does that mean? Does that mean weeks or months? I don’t know for sure.”

Recent polls suggest Trump has bolstered his support among Republicans, now in the 80 percent approval or better range in several recent surveys. The president’s overall average approval rating has inched up in recent weeks from about 39 percent to 41 percent.

But some recent polls, including Gallup and NBC News/Wall Street Journal, show his approval slipping back to under 40 percent, still historically low for a first-term president.

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North Korea, Comey, Stormy Add to Trump’s Chaotic Week

To some, it may seem like just another week at the Trump White House.

Word of a potentially historic breakthrough on North Korea is forced to compete with a scathing assessment of the president by his former FBI director. Add into the mix, court appearances earlier in the week by his personal lawyer and an adult film actress who claims she had an affair with the president. Who can blame those in Washington who ask: Is this the new normal? Or is it simply the political phenomenon of Donald Trump breaking the mold once again?

For most presidential administrations, the movement toward a summit with North Korea would be enough for a week of headlines.

“It will be a great day for them. It will be a great day for the world,” President Trump told reporters Wednesday on the possibility of a successful meeting with North Korean leader Kim Jong Un.

Trump spoke at a joint news conference with Japanese Prime Minister Shinzo Abe at the president’s Florida resort.

Bad for the country

Just minutes later, Trump made a quick pivot away from the North Korea situation to blasting the Russia probe that continues to cast a shadow over his administration.

“It is a bad thing for our country,” he said. “A very, very bad thing for our country. But there has been no collusion. They won’t find any collusion. It doesn’t exist.”

Throughout the week, the president has also been engaged in a war of words with James Comey, the man whose dismissal from the job of FBI director set in motion the appointment of special counsel Robert Mueller to lead the Russia investigation.

Comey has held a series of interviews for his new book, “A Higher Loyalty: Truth, Lies and Leadership.” Comey told the ABC News network he believes Trump is “morally unfit” to be president.

Mueller’s fate

And speaking to the USA Today newspaper, Comey mused about the possibility that the president could move to fire Mueller and the man he reports to, Deputy Attorney General Rod Rosenstein.

“That is a fundamental attack on the rule of law, so that is the most important thing. All of us should care about that,” Comey said. “Again, this is above politics, above party affiliation because it is all we are as a country.”

During his news conference on Wednesday, Trump was asked about the fate of Mueller and Rosenstein.

“They have been saying I’m going to be getting rid of them for the last three months, four months, five months, and they are still here,” said Trump. “So we want to get the investigation over with, done with, put it behind us.”

Others with the president’s ear are urging him to take action, according to Associated Press White House correspondent Jonathan Lemire.

“There is, though, a team of outside advisers, sort of Trump’s informal kitchen cabinet,” he said. “A number of those people have suggested to him, ‘Hey, you need to be tougher, Mueller is imperiling your presidency and you should fire him.'”

Some Democrats and a few Republicans are pushing congressional leaders to pass legislation that would protect Mueller and Rosenstein. But House Speaker Paul Ryan sees no need for it at present.

“We do not believe that he should be fired. We do not believe that he will be fired and we therefore don’t think that that is necessary,” Ryan told reporters this week.

Stormy weather

Adding to the turmoil this week was the Monday media circus outside a federal court in Manhattan where Trump’s personal lawyer, Michael Cohen, made an appearance along with adult film star Stormy Daniels.

Cohen was the target of FBI raids recently on his office, home and hotel and is under scrutiny for a payment to Daniels.

Daniels claims she had a brief affair with Trump back in 2006, which he has denied, and that Cohen facilitated a payment intended to silence her about the affair.

The ongoing Russia probe combined with Cohen’s legal troubles suggests more uncertainty ahead for the Trump White House.

“We are coming to some sort of a head,” said American University political expert Chris Edelson. “I mean, certainly this Cohen news is a really big deal and maybe we will find out more about that in the not too distant future. But it is hard to say with certainty what does that mean? Does that mean weeks or months? I don’t know for sure.”

Recent polls suggest Trump has bolstered his support among Republicans, now in the 80 percent approval or better range in several recent surveys. The president’s overall average approval rating has inched up in recent weeks from about 39 percent to 41 percent.

But some recent polls, including Gallup and NBC News/Wall Street Journal, show his approval slipping back to under 40 percent, still historically low for a first-term president.

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US-China Trade Row Threatens Global Confidence: IMF’s Lagarde

The biggest danger from the U.S.-China trade dispute is the threat to global confidence and investment, International Monetary Fund Managing Director Christine Lagarde said on Thursday.

The IMF chief said the tariffs threatened by the world’s two largest economies would have a modest direct impact on the global economy but could produce uncertainty that choked off investment, one of the key drivers of rising global growth.

“The actual impact on growth is not very substantial, when you measure in terms of GDP,” Lagarde said of the tariffs, adding that the “erosion of confidence” would be worse.

“When investors do not know under what terms they will be trading, when they don’t know how to organize their supply chain, they are reluctant to invest,” she told a news conference in Washington where world financial leaders gathered for the start of the IMF and World Bank spring meetings.

In its World Economic Outlook released on Tuesday, the IMF cited 2016 research showing that tariffs or other barriers leading to a 10 percent increase in import prices in all countries would lower global output by about 1.75 percent after five years and by close to 2 percent in the long term.

In Beijing, China’s Foreign Ministry warned that the Trump administration’s tariff threats and other measures to try to force trade concessions from Beijing was a “miscalculated step” and would have little effect on Chinese industries.

In the latest escalations in the trade row, Washington said this week that it had banned U.S. companies from selling parts to Chinese telecom equipment maker ZTE for seven years, while China on Tuesday announced hefty anti-dumping tariffs on imports of U.S. sorghum and measures on synthetic rubber imports from the United States, European Union and Singapore.

The U.S. Trade Representative’s office also is planning to soon release a second list of Chinese imports targeted for an additional $100 billion of U.S. tariffs, tripling the amount of Chinese goods under a tariff threat.

Lagarde said the trade tensions would be a major topic of discussion among finance ministers and central bank governors at the IMF and World Bank meetings.

“My suspicion is that there will be many bilateral discussions to be had between the various parties involved,” Lagarde said, adding that the issue would also be discussed in larger sessions involving the Fund’s 189 member countries.

“Investment and trade are two key engines that are finally picking up. We don’t want to damage that,” Lagarde said.

If the tariffs go into effect, the hit to business confidence would be worldwide because supply chains are globally interconnected, she added.

 

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US-China Trade Row Threatens Global Confidence: IMF’s Lagarde

The biggest danger from the U.S.-China trade dispute is the threat to global confidence and investment, International Monetary Fund Managing Director Christine Lagarde said on Thursday.

The IMF chief said the tariffs threatened by the world’s two largest economies would have a modest direct impact on the global economy but could produce uncertainty that choked off investment, one of the key drivers of rising global growth.

“The actual impact on growth is not very substantial, when you measure in terms of GDP,” Lagarde said of the tariffs, adding that the “erosion of confidence” would be worse.

“When investors do not know under what terms they will be trading, when they don’t know how to organize their supply chain, they are reluctant to invest,” she told a news conference in Washington where world financial leaders gathered for the start of the IMF and World Bank spring meetings.

In its World Economic Outlook released on Tuesday, the IMF cited 2016 research showing that tariffs or other barriers leading to a 10 percent increase in import prices in all countries would lower global output by about 1.75 percent after five years and by close to 2 percent in the long term.

In Beijing, China’s Foreign Ministry warned that the Trump administration’s tariff threats and other measures to try to force trade concessions from Beijing was a “miscalculated step” and would have little effect on Chinese industries.

In the latest escalations in the trade row, Washington said this week that it had banned U.S. companies from selling parts to Chinese telecom equipment maker ZTE for seven years, while China on Tuesday announced hefty anti-dumping tariffs on imports of U.S. sorghum and measures on synthetic rubber imports from the United States, European Union and Singapore.

The U.S. Trade Representative’s office also is planning to soon release a second list of Chinese imports targeted for an additional $100 billion of U.S. tariffs, tripling the amount of Chinese goods under a tariff threat.

Lagarde said the trade tensions would be a major topic of discussion among finance ministers and central bank governors at the IMF and World Bank meetings.

“My suspicion is that there will be many bilateral discussions to be had between the various parties involved,” Lagarde said, adding that the issue would also be discussed in larger sessions involving the Fund’s 189 member countries.

“Investment and trade are two key engines that are finally picking up. We don’t want to damage that,” Lagarde said.

If the tariffs go into effect, the hit to business confidence would be worldwide because supply chains are globally interconnected, she added.

 

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Unsold Aluminum Piling Up at Russian Sanctions-Hit Rusal Factory

Russian aluminum giant Rusal is stockpiling large quantities of aluminum at one of its plants in Siberia because U.S. sanctions imposed this month have prevented it from selling the metal to customers, five sources close to the company said.

With the firm’s own storage space filling up with unsold aluminum, Rusal executives in Sayanogorsk, in southern Siberia, have had to rent out additional space to accommodate the surplus stock, one of the sources told Reuters.

“Aluminum sales have broken down. And now the surplus aluminum is being warehoused in production areas of the factory itself,” said someone who works on the grounds of one of Rusal’s two plants in Sayanogorsk.

Several people connected to Rusal said that Oleg Deripaska, the company’s main shareholder who along with the company was included on a U.S. sanctions blacklist, visited Sayanogorsk this week for a closed-door meeting with staff.

Asked if the firm was stockpiling aluminum in Sayanogorsk, a Rusal spokeswoman declined to comment.

Rusal and Deripaska were included on a U.S. sanctions blacklist this month, scaring off many of its customers, suppliers and creditors who fear they too could be hit by sanctions through association with the company.

A number of traders and customers of Rusal’s aluminum have stopped buying the firm’s products, citing the sanctions risk, and Rusal has stopped shipping some of its products for export, according to a logistics firm and a railway operator that used to carry much of its aluminum.

While shipments have stalled, Rusal cannot readily reduce its production of aluminum because the electrolysis pots that are at the heart of the manufacturing process can be irreparably damaged if they are shut down.

At Rusal’s two plants in Sayanogorsk — which together accounted last year for about a quarter of the firm’s production — aluminum is now stacking up in ad hoc stockpiles dotted around the factory grounds, the sources said.

An employee with a Rusal subsidiary described how the unsold aluminum ingots were being stored in garages in the plant. He said his company had just agreed to rent out space to Rusal so it could store more of the ingots.

A contractor at the Sayanogorsk plants said the stockpiled ingots, stacked on pallets, were building up fast. He said two days’ worth of production would fill up a five-car train, but already a week had gone by with aluminum piling up.

“Can you imagine a week?” he said. “There’s a hell of a lot there, a hell of a lot. It’s being stockpiled, it’s not being shipped.”

An electrician working for Rusal said the ingots were being squeezed into all available space.

“The storage is not quite full,” said the electrician, who spoke on condition of anonymity to discuss internal company affairs. “Something is still being loaded all the same, some stuff is being shipped.”

Deripaska, who started his metals industry career in Sayanogorsk in the 1990s, visited the town this week and held a closed-door meeting with staff, according to several people with links to Rusal.

Deripaska himself was included on the U.S. sanctions blacklist, along with Rusal and other businesses where he has a controlling stake.

Washington said it took the measure against Deripaska and others because, it said, they were profiting from a Russian state engaged in “malign activities” around the world.

Since the sanctions were imposed on April 6, Rusal’s share price has slumped, the value of its bonds has plummeted and partners around the world have distanced themselves from Deripaska and his business empire.

U.S. customers cannot do business with Rusal any more under the sanctions, while major Japanese trading houses asked Rusal to stop shipping refined aluminum and other products and are scrambling to secure metal elsewhere, industry sources said.

Rusal is encountering problems at the other end of its production cycle too, with the sanctions affecting the overseas operations that supply it with the raw materials it uses to produce metal.

Rio Tinto, which supplies bauxite to some of Rusal’s refineries and buys refined alumina, said it will declare force majeure on some contracts.

Further besieging Rusal, creditors and bond-holders are trying to offload the firm’s liabilities because many financial market players believe that to handle Rusal debt could leave them too susceptible to U.S. sanctions.

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Unsold Aluminum Piling Up at Russian Sanctions-Hit Rusal Factory

Russian aluminum giant Rusal is stockpiling large quantities of aluminum at one of its plants in Siberia because U.S. sanctions imposed this month have prevented it from selling the metal to customers, five sources close to the company said.

With the firm’s own storage space filling up with unsold aluminum, Rusal executives in Sayanogorsk, in southern Siberia, have had to rent out additional space to accommodate the surplus stock, one of the sources told Reuters.

“Aluminum sales have broken down. And now the surplus aluminum is being warehoused in production areas of the factory itself,” said someone who works on the grounds of one of Rusal’s two plants in Sayanogorsk.

Several people connected to Rusal said that Oleg Deripaska, the company’s main shareholder who along with the company was included on a U.S. sanctions blacklist, visited Sayanogorsk this week for a closed-door meeting with staff.

Asked if the firm was stockpiling aluminum in Sayanogorsk, a Rusal spokeswoman declined to comment.

Rusal and Deripaska were included on a U.S. sanctions blacklist this month, scaring off many of its customers, suppliers and creditors who fear they too could be hit by sanctions through association with the company.

A number of traders and customers of Rusal’s aluminum have stopped buying the firm’s products, citing the sanctions risk, and Rusal has stopped shipping some of its products for export, according to a logistics firm and a railway operator that used to carry much of its aluminum.

While shipments have stalled, Rusal cannot readily reduce its production of aluminum because the electrolysis pots that are at the heart of the manufacturing process can be irreparably damaged if they are shut down.

At Rusal’s two plants in Sayanogorsk — which together accounted last year for about a quarter of the firm’s production — aluminum is now stacking up in ad hoc stockpiles dotted around the factory grounds, the sources said.

An employee with a Rusal subsidiary described how the unsold aluminum ingots were being stored in garages in the plant. He said his company had just agreed to rent out space to Rusal so it could store more of the ingots.

A contractor at the Sayanogorsk plants said the stockpiled ingots, stacked on pallets, were building up fast. He said two days’ worth of production would fill up a five-car train, but already a week had gone by with aluminum piling up.

“Can you imagine a week?” he said. “There’s a hell of a lot there, a hell of a lot. It’s being stockpiled, it’s not being shipped.”

An electrician working for Rusal said the ingots were being squeezed into all available space.

“The storage is not quite full,” said the electrician, who spoke on condition of anonymity to discuss internal company affairs. “Something is still being loaded all the same, some stuff is being shipped.”

Deripaska, who started his metals industry career in Sayanogorsk in the 1990s, visited the town this week and held a closed-door meeting with staff, according to several people with links to Rusal.

Deripaska himself was included on the U.S. sanctions blacklist, along with Rusal and other businesses where he has a controlling stake.

Washington said it took the measure against Deripaska and others because, it said, they were profiting from a Russian state engaged in “malign activities” around the world.

Since the sanctions were imposed on April 6, Rusal’s share price has slumped, the value of its bonds has plummeted and partners around the world have distanced themselves from Deripaska and his business empire.

U.S. customers cannot do business with Rusal any more under the sanctions, while major Japanese trading houses asked Rusal to stop shipping refined aluminum and other products and are scrambling to secure metal elsewhere, industry sources said.

Rusal is encountering problems at the other end of its production cycle too, with the sanctions affecting the overseas operations that supply it with the raw materials it uses to produce metal.

Rio Tinto, which supplies bauxite to some of Rusal’s refineries and buys refined alumina, said it will declare force majeure on some contracts.

Further besieging Rusal, creditors and bond-holders are trying to offload the firm’s liabilities because many financial market players believe that to handle Rusal debt could leave them too susceptible to U.S. sanctions.

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Russia Demands Compensation for US Tariffs on Aluminum, Steel

Russia demanded compensation from the U.S. for its worldwide tariffs on foreign aluminum and steel Thursday, becoming the third influential member of the World Trade Organization to do so.

China, the European Union and India have also objected, arguing the tariffs are a “safeguard” measure to protect U.S. domestic products from imports, which require compensation for major exporting countries.

The Trump administration has rejected that argument and says the tariffs are for national security reasons and are therefore allowed under international law.

The U.S. has agreed to negotiate with China and has informed the EU and India it is willing to discuss any other issue, while maintaining their compensation claims are unwarranted.

It is unclear what Moscow’s demand means in practice because it did not challenge the tariffs through a WTO appeals mechanism through which the organization’s 164 members can negotiate solutions to trade disputes.

China is the only country that has pursued that course and India has asked to be present at negotiations with the U.S. on the issue.

U.S. allies Australia, Canada, the EU, Mexico and South Korea have received temporary exemptions from the tariffs, pending negotiations with the U.S.

 

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Russia Demands Compensation for US Tariffs on Aluminum, Steel

Russia demanded compensation from the U.S. for its worldwide tariffs on foreign aluminum and steel Thursday, becoming the third influential member of the World Trade Organization to do so.

China, the European Union and India have also objected, arguing the tariffs are a “safeguard” measure to protect U.S. domestic products from imports, which require compensation for major exporting countries.

The Trump administration has rejected that argument and says the tariffs are for national security reasons and are therefore allowed under international law.

The U.S. has agreed to negotiate with China and has informed the EU and India it is willing to discuss any other issue, while maintaining their compensation claims are unwarranted.

It is unclear what Moscow’s demand means in practice because it did not challenge the tariffs through a WTO appeals mechanism through which the organization’s 164 members can negotiate solutions to trade disputes.

China is the only country that has pursued that course and India has asked to be present at negotiations with the U.S. on the issue.

U.S. allies Australia, Canada, the EU, Mexico and South Korea have received temporary exemptions from the tariffs, pending negotiations with the U.S.

 

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CIA Director Nominee to Face Confirmation Hearing in May

The confirmation hearing for President Donald Trump’s pick to lead the Central Intelligence Agency will begin next month.

The current deputy CIA director Gina Haspel will testify before the Senate Select Committee on Intelligence starting on May 9, the committee announced Thursday.

If confirmed, Haspel would replace Mike Pompeo, who was nominated be Secretary of State after Trump fired Rex Tillerson.

Haspel is the first woman tapped to head the CIA.

Michael Bowman contributed to this report.

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