Listen to this article
This is an experimental feature. Give us your feedback. Thank you for your feedback.
What do you think?
Sign up to receive FirstFT by email here
Authorities in Europe and Asia have taken the most dramatic action yet against Swiss private bank BSI over the multibillion-dollar scandal around Malaysia’s 1MDB state investment fund.
Switzerland has launched a criminal probe against BSI, while Singapore has ordered the bank to close its operation there after alleged serious anti-money-laundering failures.
The apparently co-ordinated move is likely to be the first of several by international regulators now investigating aspects of the 1MDB affair, amid claims that at least $4bn of Malaysian state money disappeared into a global web of bank accounts and offshore companies. (FT)
In the news
Temer’s first crisis Brazilian interim president Michael Temer suffered his first casualty less than two weeks after taking office when a senior minister stepped down on Monday night for allegedly plotting to curb corruption investigations. Planning minister Romero Jucá said he was taking leave of absence after Folha de São Paulo newspaper reported he had been caught on tape saying a change of government was needed to contain a sweeping corruption probe into state-owned oil company Petrobras. (FT)
French unions disrupt fuel supply Motorists faced long queues for petrol across France as protesters stepped up blockades of the country’s oil refineries amid mounting opposition to the government’s labour reforms. Oil sector workers of France’s hardline CGT and FO unions voted to begin a strike at ExxonMobil’s Port Jerome refinery in northern France, meaning all of France’s refineries are now striking or planning to go on strike, the CGT said. (FT)
The ‘weaponisation’ of Lego The plastic kits are taking on increasingly violent themes as toymakers engage in an “arms race” to catch children’s attention in the digital age, a study by New Zealand researchers has found. Weapons are now included in 30 per cent of kits. The strategy seems to be working: Lego almost went bankrupt in 2003-4 but now the Denmark-based company has seen 11 straight years of growth, with net profit that soared to $1.4bn in 2015. (BBC)
US banks face more post-crisis litigation A US appeals court has opened the door to more claims against the big banks for rigging benchmark interest rates, by overturning a three-year-old ruling that threw out a host of private antitrust-related lawsuits. The decision could be a setback for the likes of Bank of America, JPMorgan Chase and Citigroup, which had hoped that most of the wave of post-crisis litigation was behind them. (FT)
The shrinking number of triple As The coveted rating is nearly extinct, with just a handful of companies in the world retaining Standard & Poor’s seal of approval after ExxonMobil was downgraded last month. The demise of the triple A rating reflects a dramatic rise in the use of debt to help bolster shareholder returns and fund takeover activity. (FT)
Rare sign of discord emerges in China over economy Clear divisions have emerged within the Chinese leadership over macroeconomic policy. Premier Li Keqiang and other senior government officials view the current state of the Chinese economy in a positive light, but an anonymous figure seen as close to President Xi Jinping has made a splash by issuing a rebuttal. (NAR)
It’s a big day for
Cyber security The head of Swift will a present a plan to fight back against a wave of recent cyber thefts against members of the global bank payment messaging network. (FT)
Greece EU finance ministers will discuss the country’s bailout programme and debt relief. The meeting comes as the IMF confronts Germany over Greece’s unsustainable debt burden, issuing a bleak assessment of its financial future. (FT)
Food for thought
The American retreat from greatness If the US starts pulling back from its international role, other powers, such as China and Russia, will move to fill the vacuum, writes Gideon Rachman. “Mr Trump’s foreign policy ideas actually amount to a headlong American retreat from ‘greatness’ on the world stage.” (FT)
Justice for Freddie Gray After Monday’s acquittal of Baltimore police officer Edward Nero on charges related to the death of Freddie Gray last year, “it’s fair to say that there is little reason for optimism in the Baltimore City State’s Attorney’s office securing the convictions of any of the remaining police officers awaiting trial”, writes Tim Nolan. If the Baltimore Police Department and its officers are going to be held accountable for their role in Gray’s death, “this can only be achieved through the intervention of the US Attorney, the Department of Justice, and the Federal Bureau of Investigation”. (Daily Beast)
Machine bias In 2014, 18-year-old Brisha Borden and a friend stole a child’s bicycle and scooter; the previous summer, 41-year-old Vernon Prater was picked up for shoplifting $86.35 worth of tools. Yet something odd happened when Ms Borden and Mr Prater were booked into jail: a computer program spat out a score predicting the likelihood of each committing a future crime. Ms Borden — who is black — was rated a high risk. Mr Prater — who is white and had previous convictions — was rated a low risk. “Two years later, we know the computer algorithm got it exactly backward.” (propublica)
The factions behind the fight against Isis In the two years since Isis shocked the world by seizing Mosul and large swaths of Syria and Iraq, the US-led coalition battling the group has made progress. But the regional rivalries bolstered by the fight are getting in the way of some of the most critical battles against the jihadi group. (FT)
Gangs of El Salvador Savage turf battles between rival gangs have made murder mundane in El Salvador. Now the government, which credits its tough anti-gang task forces in ski masks for helping cut the murder rate by 42 per cent in April compared with March, has promised to bring the gangs to their knees in a year. (FT)
Video of the day
Austrian far-right candidate narrowly defeated The Austrian Freedom party candidate Norbert Hofer lost to Alexander Van der Bellen, a Green politician who ran as an independent. The result was welcomed by those worried about the emergence of a far-right head of state in a European country. The FT’s Ralph Atkins reports from Vienna. (FT)