In the midst of the pandemic, the government gave unemployment benefits to the incarcerated, the imaginary and the dead. It sent money to “farms” that turned out to be front yards. It paid people who were on the government’s “Do Not Pay List.” It gave loans to 342 people who said their name was “N/A.”
As the coronavirus shuttered businesses and forced people out of work, the federal government sent a flood of relief money into programs aimed at helping the newly unemployed and bolstering the economy. That included $3.1 trillion that former President Donald J. Trump approved in 2020, followed by a $1.9 trillion package signed into law in 2021 by President Biden.
But those dollars came with few strings and minimal oversight. The result: one of the largest frauds in American history, with billions of dollars stolen by thousands of people, including at least one amateur who boasted of his criminal activity on YouTube.
39,000 investigations going. About 50 agents in a Small Business Administration office are sorting through two million potentially fraudulent loan applications.
Officials already concede that the sheer number of cases means that some small-dollar thefts may never be prosecuted. This month, Mr. Biden signed bills extending the statute of limitations for some pandemic-related fraud to 10 years from five, a move aimed at giving the government more time to pursue cases. “My message to those cheats out there is this: You can’t hide. We’re going to find you,” Mr. Biden said during the signing at the White House.
$5 trillion in relief money in three separate legislative packages — an enormous sum that is credited with reducing poverty and saving the country from a prolonged, painful recession.
But investigators say that Congress, in its haste to get money out the door, devised all three packages with the same flaw: relying on the honor system.
For example, an expanded unemployment benefit gave workers an extra $600 per week in federal jobless funds on top of what they received from their state. The program was funded by the federal government but administered by states, which often had loose rules around qualifying. Applicants did not need to provide proof they had lost income because of Covid-19; they simply had to swear it was true.
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A similar we’ll-take-your-word-for-it approach was used in two loan programs run by the Small Business Administration.
Paycheck Protection Program, in which the government guaranteed loans made by private lenders, and the Economic Injury Disaster Loan program, in which the government itself gave out loans and smaller advance grants that did not have to be repaid. In both, the government trusted businesses to self-certify that they met key requirements.
using the email address of a burrito shop.
In the Paycheck Protection Program, private banks were supposed to help with the screening, since in theory they were dealing with customers they already knew. But that left out many small businesses, and the government allowed online lenders to enter the program. This year, University of Texas researchers found that some of those “fintech” lenders appeared less diligent about catching fraud.
turning fraud into a franchise — helping other people cook up fake businesses in order to get loans from the Economic Injury Disaster program.
Andrea Ayers advised one client to tell the government she ran a baking business from home, although she was not a baker, prosecutors said.
YouTube videos, where scammers offered to help for a cut of the proceeds. Some used the money on necessities, like mortgage bills or car payments. But many seemed to act out of opportunism and greed, splurging on a yacht, a mansion, a $38,000 Rolex or a $57,000 Pokémon trading card.
responsible for selling the card.
music video on YouTube, bragging in detail about how he had gotten rich by submitting false unemployment claims. His song was called “EDD,” after California’s Employment Development Department, which paid the benefits.
first reported by The Washington Post. In the Economic Injury Disaster Loan program, a watchdog found that $58 billion had been paid to companies that shared the same addresses, phone numbers, bank accounts or other data as other applicants — a sign of potential fraud.
“It’s clear there’s tens of billions in fraud,” said Michael Horowitz, the chairman of the Pandemic Response Accountability Committee, which includes 21 agency inspectors general working on fraud cases. “Would it surprise me if it exceeded $100 billion? No.”
The effort to catch fraudsters began as soon as the money started flowing, and the first person was charged with benefit fraud in May 2020. But investigators were quickly deluged with tips at a scale they had never dealt with before. The Small Business Administration’s fraud hotline — which had previously received 800 calls a year — got 148,000 in the first year of the pandemic. The Small Business Administration sent its inspector general two million loan applications to check for potential identity theft. At the Labor Department, the inspector general’s office has 39,000 cases of suspected unemployment fraud, a 1,000 percent increase from prepandemic levels.
But prosecutors face a key disadvantage: While fraud takes minutes, investigations take months and prosecutions take even longer.
pleaded guilty to mail fraud last month. His lawyers declined to comment.
first weeks of the pandemic, when the government gave out 5.8 million advance grants worth $19.7 billion in just over 100 days. In that program, fraud was easy to pull off, according to a government watchdog, which cited numerous loans given to businesses that were ineligible for funding.
Mr. Ware said he recently limited his agents to working 10 cases at a time, telling them: “You’re killing yourself. I have to protect you from you.”
told The New York Times in November.
“It’s a honey trap,” he added. “Richard Ayvazyan fell into that trap.” Mr. Ayvazyan was sentenced to 17 years in prison for participating in a ring that sought $20 million in fraudulent loans.
In the case of Mr. Oudomsine, the Pokémon card buyer, his lawyers argued in March that a judge should be lenient in deciding his sentence because the fraud had taken hardly any time at all.
“It is an event without significant planning, of limited duration,” said Brian Jarrard, who was Mr. Oudomsine’s lawyer at the time.
That did not work.
Judge Dudley H. Bowen Jr. of U.S. District Court sentenced Mr. Oudomsine to three years in prison, more than prosecutors had asked for, to “demonstrate to the world that this is the consequence” of fraud, according to a transcript of the sentencing.
Now, Mr. Oudomsine is appealing, with a new lawyer and a new argument. Deterrence, the new lawyer argues, is moot here because the pandemic-relief programs are over.
“There’s no way to deter someone from doing it, when there’s no way they can do it any longer,” said the lawyer, Devin Rafus.
Biden administration officials say they are trying to prepare for the next disaster, seeking to build a system that would quickly check applications for signs of identity theft.
“Criminal syndicates are going to look for weak links at moments of crisis to attack us,” said Gene Sperling, the White House coordinator for pandemic aid. He said the White House now aims to build a continuing system that would detect identity theft quickly in applications for aid: “The right time to start building a stronger system to prevent identity theft is now, not in the middle of the next serious crisis.”
In the meantime, the arrests go on.
Last week, prosecutors charged a correctional officer at a federal prison in Atlanta with defrauding the Paycheck Protection Program, saying she had received two loans totaling $38,200 in 2020 and 2021. The officer, Harrescia Hopkins, has pleaded not guilty. Her lawyer did not respond to a request for comment.
“You can’t have a system where crime pays,” said Mr. Horowitz, of the federal Pandemic Response Accountability Committee. “It undercuts the entire system of justice. It undercuts people’s faith in these programs, in their government. You can’t have that.”
Gas prices in the United States fell below $4 a gallon on Thursday, retreating to their lowest level since March, a sign of relief for Americans struggling with historically high inflation and a political boost for President Biden, who has been under pressure to do more to bring down prices.
The national average cost of a gallon of regular gasoline now stands at $3.99, according to AAA. That’s still higher than it was a year ago but well below a peak of nearly $5.02 in mid-June. The average price has fallen for 58 consecutive days.
Energy costs feed into broad measures of inflation, so the drop is also good news for policymakers who have struggled to contain rising prices. It is a welcome development for Mr. Biden, who has spent recent weeks trumpeting the drop in gasoline prices, even as he pledges to do more to bring costs down. Mr. Biden has criticized oil companies for their record profits, and this year he released some of the nation’s stockpile of oil in an effort to reduce price pressures.
cost of gasoline at the pump is determined by global oil prices, which have tumbled to their lowest point since the war in Ukraine began in February, a drop that reflects in part the growing concern of a worldwide recession that will hit demand for crude.
said in a statement, citing it as one example of recent “encouraging economic developments.”
Understand the Decline in U.S. Gas Prices
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Understand the Decline in U.S. Gas Prices
Demand is pushing prices down. As gas prices rose, people adjusted their driving habits to accommodate prices, which reached an all-time high in June. Fewer drivers on the road has made gasoline more affordable, and some states have also suspended taxes on gasoline to bring prices down.
Understand the Decline in U.S. Gas Prices
Oil prices have fallen. Just two months ago, oil prices, which are tied to gas prices, surpassed $120 a barrel, helping to push the national average price of gasoline to about $5 a gallon. But prices have steadily decreased with increased oil production, helping to bring gas prices down and easing broader recession fears.
Understand the Decline in U.S. Gas Prices
Gas prices vary. Despite the overall decline, the cost of gas can vary considerably at the state level. In California, regulations to limit pollution make driving more expensive, so gas prices will be higher than in a state like Georgia, which has lower gas taxes.
Understand the Decline in U.S. Gas Prices
A political boost for Joe Biden. The cheaper prices are a political win for President Biden, especially as falling fuel costs have brought down overall inflation. But experts are unsure that the low prices will last, as oil prices are volatile and determined by myriad forces, many of which are hard to predict.
For consumers, falling gas prices offer a respite from a shaky economy, rapid inflation and other worries. “We have new rising diseases and inflation, and people expect a recession,” said Zindy Contreras, a student and part-time waitress in Los Angeles. “If I just had to not worry about my gas tank taking up $70, that’d be a huge relief, for once.”
Ms. Contreras has been filling up her 2008 Mazda 3 only halfway as a result of the higher prices, costing her $25 to $30 each visit to the pump, and she had found opportunities to car-pool with friends. These days, Ms. Contreras usually gets gas twice a week, driving 15 miles to and from work each week and an additional 10 to 50 miles a week, depending on her plans.
The national average price masks wide regional variations. Prices vary according to the health of local economies, proximity to refineries and state taxes, said Devin Gladden, a spokesman with AAA.
weaker demand because of high costs, a sharp decline in global oil prices in recent months and the suspension of taxes on gasoline in a handful of states.
Nearly two-thirds of people in a recent AAA survey said they had altered their driving habits because of high prices, mostly by taking fewer trips and combining errands. On Thursday, the Organization of the Petroleum Exporting Countries revised down its forecast for global oil demand this year.
Regardless of the causes, the lower prices are a welcome change for drivers for whom the added expense — often $10 to $15 extra for a tank of gas — had become yet another hurdle as they sought to get their lives back to normal as the coronavirus pandemic eased.
“The affordability squeeze is becoming very real when you see these high prices at the gas pump,” said Beth Ann Bovino, the U.S. chief economist at S&P Global. “So, in that sense, it’s a positive sign certainly for those folks that are struggling.”
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That cushion — cash not spent on gasoline that can go elsewhere — also extends to businesses, particularly as the price of diesel fuel drops. Diesel, which is used to fuel, for instance, farm equipment, construction machinery and long-haul trucks, has also fallen from a June record, though at a slower pace than gasoline prices.
The drop in the price of gas is also good news for the economy, as businesses face less pressure to pass energy costs on to their customers — a move that would add to the country’s inflation problem.
hurricanes later this year could damage Gulf Coast refineries and pipelines, choking off supplies.
For now, though, the steady drop in the cost of fuel offers Americans a reprieve.
“If gasoline prices stay at or near the levels they have reached, that would mean much more cushion for households,” Ms. Bovino said.
COSTA MESA, Calif.–(BUSINESS WIRE)–The Mogharebi Group (“TMG“) has arranged the $5.45 million sale of San Pascual, a 25-unit community located in the Highland Park neighborhood in Los Angeles, CA. Bryan LaBar, Keon Truth, & Otto Ozen of The Mogharebi Group represented the seller, a Southern California family office; the winning buyer was a private investor out of Southern California.
Built in 1962, San Pascual is a 2-story garden style community located on 712 San Pascual Ave and comprises of one- & two-bedroom units situated on a .55-acre corner lot. The property features excellent accessibility to the 110 Freeway, just 2-minutes from the closest on-ramp and twelve minutes away from Downtown Los Angeles. San Pascual was offered to the market for the first time in over 20 years, making it a great opportunity to enter a high barrier to entry submarket, Highland Park.
“Despite buyer sentiment and a rapidly shifting economic landscape, we generated multiple offers, ultimately guiding the winning buyer to successfully close over 97% of list price within 3 months, in a submarket averaging 4 months to sale,” said Keon Truth. “The buyer did well to further their investment objectives by securing a high-demand multifamily asset and 25-unit foothold in a neighborhood where the average apartment building size is 12 units,” added Truth.
Highland Park, Los Angeles’ first actual suburb, has a long history filled with art, agriculture, architecture, and an ethnically diverse mix of Angelenos. Today the rapidly growing neighborhood has become a must-visit location for food enthusiasts, historic home buffs, and tourists looking for an authentic slice of LA in a vibrant hub.
About The Mogharebi Group
The Mogharebi Group is one of the largest multifamily brokerage firms in the United States by volume. With offices throughout California, Seattle, and Salt Lake City, The Mogharebi Group offers private investors and investment funds deep local market knowledge, an extensive global network of top real estate investors, state-of-the-art technology, and direct access to capital with over $800 million in regularly revolving inventory.
Policymakers in Washington are promoting electric vehicles as a solution to climate change. But an uncomfortable truth remains: Battery-powered cars are much too expensive for a vast majority of Americans.
Congress has begun trying to address that problem. The climate and energy package passed on Sunday by the Senate, the Inflation Reduction Act, would give buyers of used electric cars a tax credit.
But automakers have complained that the credit would apply to only a narrow slice of vehicles, at least initially, largely because of domestic sourcing requirements. And experts say broader steps are needed to make electric cars more affordable and to get enough of them on the road to put a serious dent in greenhouse gas emissions.
would eliminate this cap and extend the tax credit until 2032; used cars would also qualify for a credit of up to $4,000.
Energy industry. The bill would provide billions of dollars in rebates for Americans who buy energy efficient and electric appliances as well as tax credits for companies that build new sources of emissions-free electricity. The package also sets aside $60 billion to encourage clean energy manufacturing and requires businesses to pay a penalty for methane emissions that exceed federal limits starting in 2024.
Low-income communities. The bill would invest over $60 billion to support low-income communities and communities of color that are disproportionately burdened by effects of climate change. This includes grants for zero-emissions technology and vehicles, as well as money to mitigate the negative effects of highways, bus depots and other transportation facilities.
Fossil fuels industry. The bill would require the federal government to auction off more public lands and waters for oil drilling and expand tax credits for coal and gas-burning plants that rely on carbon capture technology. These provisions are among those that were added to gain the support of Senator Joe Manchin III, Democrat of West Virginia.
West Virginia. The bill would also bring big benefits to Mr. Manchin’s state, the nation’s second-largest producer of coal, making permanent a federal trust fund to support miners with black lung disease and offering new incentives for companies to build wind and solar farms in areas where coal mines or coal plants have recently closed.
With so much demand, carmakers have little reason to target budget-minded buyers. Economy car stalwarts like Toyota and Honda are not yet selling significant numbers of all-electric models in the United States. Scarcity has been good for Ford, Mercedes-Benz and other carmakers that are selling fewer cars than before the pandemic but recording fat profits.
Automakers are “not giving any more discounts because demand is higher than the supply,” said Axel Schmidt, a senior managing director at Accenture who oversees the consulting firm’s automotive division. “The general trend currently is no one is interested in low prices.”
Advertised prices for electric vehicles tend to start around $40,000, not including a federal tax credit of $7,500. Good luck finding an electric car at that semi-affordable price.
Ford has stopped taking orders for Lightning electric pickups, with an advertised starting price of about $40,000, because it can’t make them fast enough. Hyundai advertises that its electric Ioniq 5 starts at about $40,000. But the cheapest models available from dealers in the New York area, based on a search of the company’s website, were around $49,000 before taxes.
Tesla’s Model 3, which the company began producing in 2017, was supposed to be an electric car for average folks, with a base price of $35,000. But Tesla has since raised the price for the cheapest version to $47,000.
pass the House, would give buyers of used cars a tax credit of up to $4,000. The used-car market is twice the size of the new-car market and is where most people get their rides.
But the tax credit for used cars would apply only to those sold for $25,000 or less. Less than 20 percent of used electric vehicles fit that category, said Scott Case, chief executive of Recurrent, a research firm focused on the used-vehicle market.
The supply of secondhand vehicles will grow over time, Mr. Case said. He noted that the Model 3, which has sold more than any other electric car, became widely available only in 2018. New-car buyers typically keep their vehicles three or four years before trading them in.
SAIC’s MG unit sells an electric S.U.V. in Europe for about $31,000 before incentives.
New battery designs offer hope for cheaper electric cars but will take years to appear in lower-priced models. Predictably, next-generation batteries that charge faster and go farther are likely to appear first in luxury cars, like those from Porsche and Mercedes.
Companies working on these advanced technologies argue that they will ultimately reduce costs for everyone by packing more energy into smaller packages. A smaller battery saves weight and cuts the cost of cooling systems, brakes and other components because they can be designed for a lighter car.
“You can actually decrease everything else,” said Justin Mirro, chief executive of Kensington Capital Acquisition, which helped the battery maker QuantumScape go public and is preparing a stock market listing for the fledgling battery maker Amprius Technologies. “It just has this multiplier effect.”
$45 million in grants to firms or researchers working on batteries that, among other things, would last longer, to create a bigger supply of used vehicles.
“We also need cheaper batteries, and batteries that charge faster and work better in the winter,” said Halle Cheeseman, a program director who focuses on batteries at the Advanced Research Projects Agency-Energy, part of the Department of Energy.
Gene Berdichevsky, chief executive of Sila Nanotechnologies, a California company working on next-generation battery technology, argues that prices are following a curve like the one solar cells did. Prices for solar panels ticked up when demand began to take off, but soon resumed a steady decline.
The first car to use Sila’s technology will be a Mercedes luxury S.U.V. But Mr. Berdichevsky said: “I’m not in this to make toys for the rich. I’m here to make all cars go electric.”
A few manufacturers offer cars aimed at the less wealthy. A Chevrolet Bolt, a utilitarian hatchback, lists for $25,600 before incentives. Volkswagen said this month that the entry-level version of its 2023 ID.4 electric sport utility vehicle, which the German carmaker has begun manufacturing at its factory in Chattanooga, Tenn., will start at $37,500, or around $30,000 if it qualifies for the federal tax credit.
Then there is the Wuling Hongguang Mini EV, produced in China by a joint venture of General Motors and the Chinese automakers SAIC and Wuling. The car reportedly outsells the Tesla Model 3 in China. While the $4,500 price tag is unbeatable, it is unlikely that many Americans would buy a car with a top speed of barely 60 miles per hour and a range slightly over 100 miles. There is no sign that the car will be exported to the United States.
Eventually, Ms. Bailo of the Center for Automotive Research said, carmakers will run out of well-heeled buyers and aim at the other 95 percent.
“They listen to their customers,” she said. “Eventually that demand from high-income earners is going to abate.”
The logo of networking gear maker Cisco Systems Inc is seen during GSMA’s 2022 Mobile World Congress (MWC) in Barcelona, Spain February 28, 2022. REUTERS/Nacho Doce
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OAKLAND, Calif., Aug 5 (Reuters) – Cisco Systems Inc (CSCO.O) on Friday lost a court appeal to move to private arbitration a case over alleged caste discrimination in its Silicon Valley offices, where managers of Indian descent are accused of bias against a fellow employee from India.
The networking gear and business software company has denied the allegations. It had argued to a California appeals court that the state’s Civil Rights Department, which had brought the case on behalf of a worker identified under the pseudonym John Doe, should be subjected to an employment arbitration agreement signed by Doe.
“As an independent party, the Department cannot be compelled to arbitrate under an agreement it has not entered,” the appellate panel wrote.
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In a separate order Friday, it told a lower-court judge to reconsider a ruling that would have required the state to identify Doe. The lower court had said the law prevented it from considering whether Doe’s family members in India could be harmed by naming him.
The higher court wrote that “harm to family members anywhere is a legitimate consideration in determining whether a party should be granted anonymity.”
Cisco and the state agency did not immediately respond to requests for comment.
The ancient socioreligious concept of caste has led to centuries of oppression against some families born into the lowest groupings in India. California has alleged that those biases had traveled to the U.S. tech industry, where Indians are the largest pool of immigrant workers.
The state sued Cisco in 2020 after Doe complained to it about company human resources staff not finding merit in his concerns that two higher-caste managers had allegedly denied him work and disparaged him.
The lawsuit has ignited advocacy at U.S. companies, universities and other institutions calling for more guidelines and training related to the potential for caste prejudice.
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Reporting by Paresh Dave; Editing by David Gregorio & Shri Navaratnam
Our Standards: The Thomson Reuters Trust Principles.
San Francisco Bay Area-based tech reporter covering Google and the rest of Alphabet Inc. Joined Reuters in 2017 after four years at the Los Angeles Times focused on the local tech industry.
LOS ANGELES–(BUSINESS WIRE)–Creative Media & Community Trust (NASDAQ: CMCT; TASE: CMCT-L) (“CMCT”) announced today that it will issue a press release announcing its second quarter 2022 earnings results on Tuesday, August 9, 2022.
A conference call is scheduled for 12:00 p.m. Eastern Time that day to discuss CMCT’s financial results and business. The call will be hosted by Shaul Kuba, Board Member and a Co-Founder of CIM Group, David Thompson, Chief Executive Officer, Nate DeBacker, Chief Financial Officer, and Steve Altebrando, Vice President Portfolio Oversight.
Interested parties can listen to the call via the following:
Go to www.creativemediacommunity.com and select the “Shareholders” tab at least 15 minutes prior to the start time of the call to register, download and install any necessary audio software. A replay will be available for 90 days on our website at www.creativemediacommunity.com.
1-844-763-8274 (Domestic) or 1-412-717-9224 (International)
Available through August 19, 2022 at 9:00 a.m. Eastern Time.
1-877-344-7529 (Domestic) or 1-412-317-0088 (International) – conference ID #5491429
ABOUT CREATIVE MEDIA & COMMUNITY TRUST CORPORATION
Creative Media & Community Trust Corporation (“CMCT”) is a real estate investment trust that seeks to own, operate and develop premier multifamily and creative office assets in vibrant and emerging communities throughout the United States. CMCT is a leader in creative office, acquiring and developing properties catering to rapidly growing industries such as technology, media and entertainment. CMCT seeks to apply the expertise of CIM to the acquisition, development, and operation of top-tier multifamily properties situated in dynamic markets with similar business and employment characteristics to its creative office investments. CMCT also owns one hotel in Northern California and a lending platform that originates loans under the Small Business Administration (“SBA”)’s 7(a) loan program. CMCT is operated by affiliates of CIM Group, L.P., a vertically-integrated owner and operator of real assets with multi-disciplinary expertise and in-house research, acquisition, credit analysis, development, finance, leasing, and onsite property management capabilities. (www.creativemediacommunity.com).
The software that many school districts use to track students’ progress can record extremely confidential information on children: “Intellectual disability.” “Emotional Disturbance.” “Homeless.” “Disruptive.” “Defiance.” “Perpetrator.” “Excessive Talking.” “Should attend tutoring.”
Now these systems are coming under heightened scrutiny after a recent cyberattack on Illuminate Education, a leading provider of student-tracking software, which affected the personal information of more than a million current and former students across dozens of districts — including in New York City and Los Angeles, the nation’s largest public school systems.
Officials said in some districts the data included the names, dates of birth, races or ethnicities and test scores of students. At least one district said the data included more intimate information like student tardiness rates, migrant status, behavior incidents and descriptions of disabilities.
Chicago Public Schools, the nation’s third-largest district.
Now some cybersecurity and privacy experts say that the cyberattack on Illuminate Education amounts to a warning for industry and government regulators. Although it was not the largest hack on an ed tech company, these experts say they are troubled by the nature and scope of the data breach — which, in some cases, involved delicate personal details about students or student data dating back more than a decade. At a moment when some education technology companies have amassed sensitive information on millions of school children, they say, safeguards for student data seem wholly inadequate.
“There has really been an epic failure,” said Hector Balderas, the attorney general of New Mexico, whose office has sued tech companies for violating the privacy of children and students.
In a recent interview, Mr. Balderas said that Congress had failed to enact modern, meaningful data protections for students while regulators had failed to hold ed tech firms accountable for flouting student data privacy and security.
outpacing protections for students’ personal information. Lawmakers rushed to respond.
Since 2014, California, Colorado and dozens of other states have passed student data privacy and security laws. In 2014, dozens of K-12 ed tech providers signed on to a national Student Privacy Pledge, promising to maintain a “comprehensive security program.”
Supporters of the pledge said the Federal Trade Commission, which polices deceptive privacy practices, would be able to hold companies to their commitments. President Obama endorsed the pledge, praising participating companies in a major privacy speech at the F.T.C. in 2015.
The F.T.C. has a long history of fining companies for violating children’s privacy on consumer services like YouTube and TikTok. Despite numerous reports of ed tech companies with problematic privacy and security practices, however, the agency has yet to enforce the industry’s student privacy pledge.
In May, the F.T.C. announced that regulators intended to crack down on ed tech companies that violate a federal law — the Children’s Online Privacy Protection Act — which requires online services aimed at children under 13 to safeguard their personal data. The agency is pursuing a number of nonpublic investigations into ed tech companies, said Juliana Gruenwald Henderson, an F.T.C. spokeswoman.
company’s site says its services reach more than 17 million students in 5,200 school districts. Popular products include an attendance-taking system and an online grade book as well as a school platform, called eduCLIMBER, that enables educators to record students’ “social-emotional behavior” and color-code children as green (“on track”) or red (“not on track”).
Illuminate has promoted its cybersecurity. In 2016, the company announced that it had signed on to the industry pledge to show its “support for safeguarding” student data.
Concerns about a cyberattack emerged in January after some teachers in New York City schools discovered that their online attendance and grade book systems had stopped working. Illuminate said it temporarily took those systems offline after it became aware of “suspicious activity” on part of its network.
On March 25, Illuminate notified the district that certain company databases had been subject to unauthorized access, said Nathaniel Styer, the press secretary for New York City Public Schools. The incident, he said, affected about 800,000 current and former students across roughly 700 local schools.
For the affected New York City students, data included first and last names, school name and student ID number as well as at least two of the following: birth date, gender, race or ethnicity, home language and class information like teacher name. In some cases, students’ disability status — that is, whether or not they received special education services — was also affected.
said they were outraged. In 2020, Illuminate signed a strict data agreement with the district requiring the company to safeguard student data and promptly notify district officials in the event of a data breach.
kept student data on the Amazon Web Services online storage system. Cybersecurity experts said many companies had inadvertently made their A.W.S. storage buckets easy for hackers to find — by naming databases after company platforms or products.
a spate of cyberattacks on both ed tech companies and public schools, education officials said it was time for Washington to intervene to protect students.
“Changes at the federal level are overdue and could have an immediate and nationwide impact,” said Mr. Styer, the New York City schools spokesman. Congress, for instance, could amend federal education privacy rules to impose data security requirements on school vendors, he said. That would enable federal agencies to levy fines on companies that failed to comply.
One agency has already cracked down — but not on behalf of students.
Last year, the Securities and Exchange Commission charged Pearson, a major provider of assessment software for schools, with misleading investors about a cyberattack in which the birth dates and email addresses of millions of students were stolen. Pearson agreed to pay $1 million to settle the charges.
Mr. Balderas, the attorney general, said he was infuriated that financial regulators had acted to protect investors in the Pearson case — even as privacy regulators failed to step up for schoolchildren who were victims of cybercrime.
“My concern is there will be bad actors who will exploit a public school setting, especially when they think that the technology protocols are not very robust,” Mr. Balderas said. “And I don’t know why Congress isn’t terrified yet.”
WASHINGTON — The Federal Trade Commission on Wednesday filed for an injunction to block Meta, the company formerly known as Facebook, from buying a virtual reality company called Within, potentially limiting the company’s push into the so-called metaverse and signaling a shift in how the agency is approaching tech deals.
The antitrust lawsuit is the first under Lina Khan, the commission’s chair and a leading progressive critic of corporate concentration, against one of the tech giants. Ms. Khan has argued that regulators must stop competition and consumer protection violations when it comes to the bleeding edge of technology, including virtual and augmented reality, and not just in areas where the companies have already become behemoths.
The F.T.C.’s request for an injunction puts Ms. Khan on a collision course with Mark Zuckerberg, Meta’s chief executive, who is also named as a defendant in the request. He has poured billions of dollars into building products for virtual and augmented reality, betting that the immersive world of the metaverse is the next technology frontier. The lawsuit could crimp those ambitions.
in its lawsuit, which was filed in the U.S. District Court for the Northern District of California. “Instead, it chose to buy” a top company in what the government called a “vitally important” category.
attack on innovation and that the agency was “sending a chilling message to anyone who wishes to innovate in V.R.”
Meta had said it would acquire Within, which produces the highly popular fitness app called Supernatural, last year for an undisclosed sum. The company has promoted its virtual reality headsets for fitness and health purposes.
The F.T.C.’s lawsuit is highly unusual and pushes the boundaries of antitrust law. Regulators mostly focus on deals between large companies in large markets, rather than their acquisitions of small start-ups in nascent tech areas. Courts have also been skeptical applying antitrust law to block mergers based on the hypothetical that the two companies involved would later become competitors if the deal was blocked.
Instagram, the photo-sharing app that has since grown to more than one billion regular users. Instagram has helped Meta dominate the market on social photo sharing, though other start-ups have sprung up since.
lawsuit against Facebook that argued the company shut down nascent competition through acquisitions. The Justice Department has also sued Google over whether the company abused a monopoly over online search.
More cases could be coming. The F.T.C. is investigating whether Amazon has violated antitrust laws, and the Justice Department has inquiries into Google’s dominance over advertising technology and into Apple’s App Store policies.
For Mr. Zuckerberg, the F.T.C. lawsuit is a setback. He has been pushing Meta away from its roots in social networking as its apps, like Facebook and Instagram, face more competition amid stumbles in privacy and content moderation. Instead, he has bet on the metaverse.
Mr. Zuckerberg has reassigned employees and put a top lieutenant in charge of metaverse efforts. He has also authorized executives to pursue some of the most popular games in the V.R. space. In 2019, Facebook purchased Beat Games, makers of the hit title Beat Saber, one of the top V.R. games on the Oculus platform. He has also authorized the purchase of roughly half a dozen other virtual reality or gaming studios over the past three years.
The F.T.C. filed suit on Wednesday hours before Meta reported its first decline in quarterly revenue since it went public in 2012. The company has recently trimmed employee perks and reined in spending amid uncertain economic conditions. John Newman, the deputy director of the F.T.C.’s Bureau of Competition, said the agency acted on the Within deal because Meta was “trying to buy its way to the top.” The company already owned a best-selling virtual reality fitness app, he said, but then chose to acquire Within’s Supernatural app “to buy market position.” He said the deal was “an illegal acquisition, and we will pursue all appropriate relief.”
The F.T.C.’s vote to authorize the filing was split 3 to 2. Christine Wilson, a Republican commissioner at the agency, said she was one of the two votes against the lawsuit. She declined to comment onher reasoning.
The F.T.C. said in its request that asking for an injunction was sometimes a prelude to filing a complaint against a merger, which could embroil Meta and the agency in a lengthy trial and appeals process. A F.T.C. spokeswoman said the agency had not filed such a complaint and declined to comment further on the agency’s strategy.
Ms. Khan, 33, who was appointed by President Biden last year to acclaim from the left, has tried to make good on expansive promises to rein in corporate power. She became prominent after she wrote an article in law school in 2017 criticizing Amazon. As F.T.C. chair, she has called for regulators to vigorously enforce antitrust laws and has said she may craft sweeping online privacy rules that would implicate Silicon Valley companies.
The lawsuit drew praise from Ms. Khan’s allies. Sandeep Vaheesan, the legal director of the Open Markets Institute, a liberal think tank, said in a statement that the lawsuit was a “step toward making building, not buying, the norm for Facebook.”
But tech industry allies assailed Ms. Khan’s actions. Adam Kovacevich, the chief executive of Chamber of Progress, an industry group funded partly by Meta, said that with the new lawsuit, “the agency is more focused on getting headlines than results.” He said Meta “isn’t any closer than pickleball or synchronized swimming are to locking up the fitness market.”
Meta said in a blog post that the F.T.C. would fail to prove that the Within deal would “substantially lessen competition,” which is the bar that is typically set to block a deal under federal antitrust law.
In its lawsuit, the F.T.C. said that if Meta bought Within’s Supernatural, it would no longer have an incentive to improve Beat Saber, the virtual reality fitness game it already owns. But Nikhil Shanbhag, an associate general counsel for Meta, said in the blog post that the games weren’t competitors.
“Beat Saber is a game people play to have fun and it has many competitors,” he said. “Supernatural couldn’t be more different.”
LAS VEGAS–(BUSINESS WIRE)–Fredrik Eklund, founder of Douglas Elliman’s top-producing team, the Eklund | Gomes Team, and alum of Bravo TV’s “Million Dollar Listing” franchise, announced he is the co-founder of a new groundbreaking social app for real estate called REAL. Eklund joined forces with Thomas Ma, an entrepreneur and licensed real estate agent from Hong Kong with notable success in proptech and start-ups, because they saw how large proptech platforms were diminishing agents’ roles and control.
The high-speed app offers an Instagram-style platform combined with a WhatsApp-style chat feature, enabling agents to promote themselves for free rather than having to advertise to attract followers interested in connecting with them.
“The pandemic changed how we communicate; everything is digital and much faster,” explained Fredrik Eklund, co-founder and chief visionary of REAL. “National – and even global – real estate is becoming one big market as people are moving around more and searching globally. Agents are getting licensed in many different states and there’s a complete crossover happening, especially in the luxury market. Current real estate apps, like Zillow, do not provide quick answers and MLSs are slow. I run a large team and see all facets of the market, in all price points, and how quickly it moves. People want to use their mobile phones for this, they want it to be fun, and they want it to be FAST. At the same time, they see what people around them like and look at. Consumers are smarter today. They don’t want to see what listings Zillow pushes because agents have paid for those hidden ads. They want to see what’s truly popular socially.”
Advantages of REAL:
Followers – sellers and buyers – can see agents’ reviews of highly curated listings and get a feel for their personalities, styles and tastes through their individual profiles on the app.
They can also see what’s popular in the market and benefit from the app’s advanced AI technology to conduct highly specific, expedited searches tailored to their specific needs. For example, families seeking a home with a swimming pool and patio can search for all residences with those criteria in a specified community or zip code.
It reflects Ma and Eklund’s shared vision of an app with real-time, built-in social networking capabilities allowing for quick and seamless information about listings and promoting connections and communication between agents, buyers and sellers.
It allows agents to post a preview of properties not yet on the market among the listings on their profiles.
Through its network of agents, it allows users to build a contact list of a global family of agents with which to communicate – something unique to real estate that platforms like Zillow do not offer.
It stores data in its WhatsApp-style platform with a contact list so connections are made and retained. This is an incredible asset for agents wishing to touch base with contacts at appropriate times and it helps to replace the hassle of excessive follow-up correspondence, something that has plagued the industry historically.
The chat feature enables agents to keep up with their followers, knowing when it’s best to contact them and when it’s not. And followers can reach out directly to REAL’s agents.
All of this is free for everyone.
The potential of a large business and financial impact for an app of this nature is why Eklund joined forces with Ma, known for leveraging his learnings by bringing insights from Hong Kong to the U.S. market. Ma understood the challenges, the significant time and the investments agents put toward developing leads and securing listings. He also understood how the shift toward proptech platforms meant agents were being asked to advertise their own services with little to no return on investment.
Ma explained: “REAL launched on the app store 11 months ago, has 147,500 downloads to date and that number is growing. Traditionally, agents are referred by someone, your friend or relative, your acquaintance, or even a friend of a friend. The agents you’re introduced to don’t really know who you are, your unique tastes, your lifestyle, or your needs to facilitate your home search. We wanted to give talented agents an opportunity to share their stories, their knowledge, and their experience, and give them control of what listings and recommendations they bring to their audience. Users – agents, home buyers and sellers – can then choose to follow or connect with those agents based on compatibility and personality to fit their specific needs. Fredrik’s extensive real estate experience and his journey to becoming a leader in the industry gives him unique insight into the challenges related to building a network as an agent. He knows the importance of acquiring a following to foster and retain connections. We could not have asked for a better co-founder and chief visionary for our company.”
Fredrik Eklund’s Eklund | Gomes team currently has 91 agents across 13 markets and five states and the majority of those are already using and enjoying the REAL app. REAL currently has a team of 14 programmers.
REAL is the first and only social app combined with messaging for real estate that puts agents back in control of their business. For the first time, agents can generate free leads without expensive online ads, labor-intensive emails, or extraneous and ineffective cold calls. REAL helps agents build professional relationships online with interested prospects, keeping them connected and enabling the agents and their prospects to engage with one another at any time. They can do this all through REAL’s social platform designed exclusively for real estate. REAL agents curate their feature images, content and chat topics to reflect their expertise and knowledge. When future buyers and sellers browse REAL’s online magazine, they view content curated by agents and follow those whose interests align with their own. REAL was co-founded by Hong Kong real estate entrepreneur Thomas Ma and Fredrik Eklund, co-founder of Douglas Elliman’s Eklund | Gomes Team and former star of Bravo’s “Million Dollar Listing NY & LA.”
About Fredrik Eklund
With record-breaking sales and socks as colorful as his personality, Fredrik Eklund has become an icon in real estate and on Bravo’s “Million Dollar Listing” series, appearing as the only cast member to star in both the New York and Los Angeles versions. Co-founder of The Eklund | Gomes Team, co-founded by John Gomes, the dynamic duo have secured over $15 billion in closed sales over the last decade and have become a staple of New York, California, Texas and Florida real estate. Consistently ranked on industry hot lists, including The Hollywood Reporter Power Brokers and Variety’s Real Estate Elite, Eklund | Gomes continues to sit on the top, bringing in $4.5 billion in sales in 2021 alone. In 2022, they notched the priciest sale of the year for New York at 432 Park Ave., for $70.5 million, and are taking their momentum to Nevada where they are expanding this summer.
About Thomas Ma
Thomas Ma, who hails from one of Hong Kong’s leading real estate developer families, became successful in his own right when he ventured into tech. Ma became an active business leader in proptech and subsequently brought his passion and in-depth understanding of real estate from international waters to the U.S. market. He saw the industry shift toward large proptech platforms, presenting steep financial hurdles for agents and decided to develop a new way for agents to showcase their listings. This led to him co-founding REAL, giving agents back control of their listings to generate leads and maximize their online presence. Prior to launching REAL, Ma created HOJOJO. The rental marketplace and leasing management system helped corporate landlords maintain every aspect of their rental properties — from receiving offers to collecting rent payments. Now, as the CEO of REAL, Ma is leveraging his past learnings to introduce an emerging technology to the U.S. real estate industry.
Months before former President Donald J. Trump’s social media company unveiled an agreement to raise hundreds of millions of dollars last fall, word of the deal leaked to an obscure Miami investment firm, whose executives began plotting ways to make money off the imminent transaction, according to people familiar with the discussions.
The deal — in which a so-called special purpose acquisition company, or SPAC, would merge with Mr. Trump’s fledgling media business — was announced in October. It sent shares of the SPAC soaring.
Employees at the Miami investment firm, Rocket One Capital, had learned of the pending deal over the summer, long before it was announced, according to three people familiar with the firm’s internal discussions. Two of the people said that Rocket One officials at the time talked about ways to profit off the soon-to-be-announced transaction with Trump Media & Technology Group by investing in the SPAC, Digital World Acquisition Corporation.
a surge in trading in a type of security known as warrants, which entitled investors to buy shares of Digital World at a preset price in the future.
Federal prosecutors and regulators are now investigating the merger between Digital World and Trump Media, including the frenzied trading in the SPAC’s warrants, according to people familiar with the investigation and public disclosures. Digital World said in a recent regulatory filing that a federal grand jury in Manhattan had issued subpoenas seeking information about Rocket One, among other things.
The exact scope of the federal investigations remains unclear. Authorities have not accused anyone of wrongdoing, and representatives of Mr. Garelick and others denied doing anything improper.
A lawyer for Rocket One and its founder, Michael Shvartsman, denied that they had any advance knowledge of the merger between Digital World and Trump Media. He added that “any assertion otherwise is untrue.”
a recent news release that neither Mr. Trump nor Devin Nunes, the former California congressman who is the company’s chief executive, received grand jury subpoenas. (The release identified the men only by their job titles.)
The investigation into unusual trading in Digital World securities is the latest blow to Mr. Trump’s social media venture, which has struggled with technological problems and slow user growth.
Federal authorities are also investigating whether Digital World’s disclosures about the merger talks with Trump Media violated rules governing SPACs. And the Securities and Exchange Commission is considering whether to block the merger, according to regulatory filings by Digital World. If the deal doesn’t go through, it would deprive Trump Media of $1.3 billion.
There is scant public information about Rocket One, which has fewer than 10 employees and has made about 20 early-stage investments over the past decade, according to a review of archived web pages and an analysis by PitchBook, a data company. Rocket One disabled its website soon after its name appeared in a Digital World regulatory filing.
Two of the people familiar with Rocket One’s internal discussions said Mr. Garelick, a former Boston hedge fund manager who is now Rocket One’s chief strategy officer, mentioned the possible deal with Trump Media to some employees last summer. Around that time, a Rocket One employee was told to conduct a financial analysis of Digital World, including its warrants, one of the people said.
investigate whether the leaders of Digital World and Trump Media started negotiating a potential merger before Digital World sold shares through an initial public offering in September. At the time of Digital World’s initial public offering, the company said in public filings that it had not yet identified a merger target. But The New York Times previously reported that talks between Mr. Orlando and Trump Media officials were already underway.
previously reported that they were involved in some of the early talks with Mr. Orlando.
Mr. Moss and Mr. Litinsky, who at one time were senior executives with Trump Media, didn’t respond to requests for comment. Mr. Litinsky no longer works for Trump Media; Mr. Moss’s job status is unclear.
Securities regulators also have asked for information from Digital World about the role played by the SPAC’s financial adviser, Shanghai-based ARC Group, according to regulatory filings. Federal regulators previously have reprimanded ARC. In 2017, the S.E.C. stopped ARC’s executives from listing shares of three companies, citing “material misstatements” in their securities filings and a lack of cooperation from the executives.
Ben Protess contributed reporting. Susan C. Beachy contributed research.