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  1. It’s separate from the Google and Apple investigations that were announced earlier After months of heightened tech scrutiny from both Republicans and Democrats, the Justice Department is opening a new antitrust investigation into large tech firms like Facebook, Amazon, and Google. “Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands,” said Assistant Attorney General Makan Delrahim of the Antitrust Division. “The Department’s antitrust review will explore these important issues.” The investigation will address broad concerns over whether Big Tech is stifling competition, and will be separate from the department’s probes of Google and Apple that were reported earlier this summer and are intended to take a closer look at individual potential violations. The review reported today will look into search engines, social media platforms, and retail, but not focus on any individual company or practice. In a press release, the Justice Department said the review “will consider the widespread concerns that consumers, businesses, and entrepreneurs have expressed about search, social media, and some retail services online.” At Attorney General Barr’s confirmation hearing this past January, he told senators that he would like to see the Justice Department take a harder look at whether companies like Google and Amazon were abusing their market dominance. “I’d like to have the antitrust [officials] support that effort to get more involved in reviewing the situation from a competition standpoint,” Barr said at the time. “I don’t think big is necessarily bad, but I think a lot of people wonder [how] these big behemoths have taken shape in Silicon Valley.” Source
  2. A meeting of the country’s top federal and state law enforcement officials on Tuesday could presage a series of sweeping new investigations of Apple, Amazon, Facebook, Google and their tech industry peers, stemming from lingering frustrations that these companies are too big, fail to safeguard users' private data and don’t cooperate with legal demands. Attorney General Jeff Sessions met with the attorneys general of several states to discuss complaints against social media companies. A meeting of the country’s top federal and state law enforcement officials on Tuesday could presage a series of sweeping new investigations of Apple, Amazon, Facebook, Google and their tech industry peers, stemming from lingering frustrations that these companies are too big, fail to safeguard users' private data and don’t cooperate with legal demands. The gathering at the Justice Department had been designed to focus on social media platforms and the ways in which they moderate content online, following complaints from President Trump and other top Republicans that Silicon Valley companies deliberately seek to silence conservative users and views online. Attorney General Jeff Sessions opened the meeting by raising questions of possible ideological bias among the tech companies and sought to bring the conversation back to that topic at least twice more, according to D.C. Attorney General Karl A. Racine. But the discussion proved far more wide-ranging, as attorneys general from eight states and the District — and officials from five others — steered the conversation toward the privacy practices of Silicon Valley. Those in the meeting did not zero in on specific business tactics, but they did cover such issues as how companies collect user data and what they do with it once the information is in their hands. “We were unanimous. Our focus is going to be on antitrust and privacy. That’s where our laws are,” Jim Hood, Mississippi’s attorney general, said in an interview. Most in the meeting agreed that the Justice Department would probably play a role in any legal action against the tech industry. Still, much of the group’s momentum now appears to be driven by an emerging multistate inquiry — not the Justice Department — with Nebraska Attorney General Doug Peterson expected to coordinate the attorneys general’s conversation. “[The] AGs are really focused on understanding more as to what consumers are truly consenting to and what they may not know is going on with their data,” Racine said in an interview. For months, tech giants like Facebook, Google and Twitter have weathered brutal criticism in the nation’s capital for their business practices — from the ways they safeguard their data to their preparedness to combat misinformation online ahead of the 2018 midterm elections. As these companies have faced pressure to actively monitor the content on their platforms, however, they’ve opened themselves up to new political attacks from Republicans who think Silicon Valley’s policies result in the silencing of conservatives. The criticisms have even come from the White House, where Trump most recently accused Google of producing “rigged” search results — and his administration has floated regulating the industry in response. Announcing the gathering earlier this month, the Justice Department said it hoped to convene “a meeting with a number of state attorneys general this month to discuss a growing concern that these companies may be hurting competition and intentionally stifling the free exchange of ideas on their platforms.” On Tuesday, though, DOJ said that “discussion principally focused on consumer protection and data privacy issues, and the bipartisan group of attendees sought to identify areas of consensus.” A spokesman at the agency declined to provide further detail. Exiting the discussions, Hood, for example, floated the possibility of a “working group going forward to look at the anti-competitive aspects” of the tech industry. The formal partnership between attorneys general and the federal government would allow them to have “information sharing on separate litigations we have ongoing,” he said. But attorneys general from both parties seemed reluctant to use antitrust law to address allegations of online bias. Hood, for one, said there are issues with the way tech companies moderate their platforms. “We AGs don’t want to wade off into that battle,” he said. Another attorney general — Democrat Brian E. Frosh of Maryland — said there was little basis for using antitrust law to prosecute allegations of ideological bias. Whether state and federal officials have the legal tools under antitrust law to regulate the tech industry’s data practices was a major question for the group. Citing previous cases in which the government intervened against anti-competitive behavior, the officials considered the dominance of Standard Oil, the Justice Department’s breakup of AT&T’s telephone monopoly and the quest to take apart Microsoft. Few in the meeting seemed ready to seriously discuss breaking up Silicon Valley’s most dominant players. But those cases represented “pivot points” in the nation’s history that could prove instructive to policymakers, said California Attorney General Xavier Becerra. “All of those cases and situations inform you when it comes to a conversation about this new sector,” he told reporters Tuesday. For other states, the issue was the tech industry’s relationship with law enforcement. That included talk about Apple and “how we in law enforcement depend on cellphones.” Hood said that Apple has “waved at us and didn’t use all their fingers” in its handling of encryption. A number of tech companies, including Apple, Google and Twitter, are expected to testify Wednesday before the Senate Commerce Committee in a hearing on privacy safeguards. More law enforcement officials could be drawn into the state and federal discussion over the coming months, particularly during a convention of state attorneys general that is scheduled for late November. Sessions opened the meeting, which also included Deputy Attorney General Rod J. Rosenstein, by talking about “some of the antitrust issues and concerns, about how consolidated the information is,” Hood said. Sessions returned to the question of ideological bias once in the middle of the session and once again toward the end, according to Racine. At one point, Sessions turned to the Justice Department’s antitrust chief, Makan Delrahim, who was also in attendance, for his perspective. “The antitrust head, in turn, made it clear that his office and his resources were available for AGs to look at these technologies under an antitrust analysis,” Racine said. The Justice Department called the gathering a “productive dialogue” in a statement Tuesday and pledged to review the results. Source
  3. The Justice Department have indicted dozens of individuals accused of their involvement in a massive business email scam and money laundering scheme. Thom Mrozek, a spokesperson for the U.S. Attorneys Office for the Central District of California, confirmed more than a dozen individuals had been arrested during raids on Thursday — mostly in the Los Angeles area. A total of 80 defendants are allegedly involved in the scheme. News of the early-morning raids were first reported by ABC7 in Los Angeles. The 145-page indictment, unsealed Thursday, said the 80 named individuals are charged with conspiracy to commit mail and bank fraud, as well as aggravated identity theft and money laundering. Most of the individuals alleged to be involved in the scheme are based in Nigeria, said the spokesperson. But it’s not immediately known if the Nigerian nationals will be extradited to the U.S., however a treaty exists between the two nations making extraditions possible. U.S. Attorney Nicola Hanna said the case was part of an ongoing effort to protect citizens and businesses from email scams. “Today, we have taken a major step to disrupt criminal networks that use [business email scam] schemes, romance scams and other frauds to fleece victims,” he said. “This indictment sends a message that we will identify perpetrators — no matter where they reside — and we will cut off the flow of ill-gotten gains.” These business email compromise scams rely partly on deception and in some cases hacking. Scammers send specially crafted spearphishing emails to their targets in order to trick them into turning over sensitive information about the company, such as sending employee W-2 tax documents so scammers can generate fraudulent refunds, or tricking an employee into making wire transfers to bank accounts controlled by the scammers. More often than not, the scammers use spoofing techniques to impersonate a senior executive over email to trick the unsuspecting victim, or hack into the email account of the person they are impersonating. The FBI says these impersonation attacks have cost consumers and businesses more than $3 billion since 2015. Valentine Iro, 31, and Chukwudi Christogunus Igbokwe, 38, both Nigerian nationals and residents of California, are accused of running the operation, said prosecutors. The alleged fraudsters are accused of carrying out several hundred “overt” acts of fraud against over a dozen victims, generating millions of dollars worth of fraud over several months. In some cases the fraudsters would hack into the email accounts of the person they were trying to impersonate to try to trick a victim into wiring money from a business into the fraudster’s bank account. Iro and Igbokwe were “essentially brokers” of fraudulent bank accounts, prosecutors allege, by fielding requests for bank account information and laundering the money obtained from victims. The two lead defendants are accused of taking a cut of the stolen money. They then allegedly used illicit money exchanges to launder the money. Several bank accounts run by the fraudsters contained over $40 million in stolen funds. The FBI said the agency has seem a large increase in the number of business email scams in the past year targeting small and large businesses, as well as non-profits. Source
  4. Makan Delrahim, head of the Justice Department’s antitrust division, said the debate over whether big tech companies have violated laws is important but cautioned that antitrust enforcers need “credible evidence” that the companies are taking steps to harm competition. A day after Attorney General Jeff Sessions said the Justice Department will examine whether big technology companies are harming competition, his chief antitrust enforcer made clear the obstacles the government faces in bringing a case. “Just because somebody is big does not mean they have violated the laws. Nor should we condemn them because they have succeeded,” Makan Delrahim, the head of the department’s antitrust division, said at a conference in New York on Thursday. Delrahim was responding to a question from an audience member who asked about targeting Amazon as a monopoly and breaking up the online retailer. The dominance of technology companies like Amazon and Google — and how or whether the companies should be regulated — is emerging as an issue in Washington, D.C. On Wednesday, the matter was front and center as Facebook Chief Operating Officer Sheryl Sandberg and Twitter Chief Executive Officer Jack Dorsey testified about misinformation and election interference. Hours later, the Justice Department announced it would look at the companies with state attorneys general. “The attorney general has convened a meeting with a number of state attorneys general this month to discuss a growing concern that these companies may be hurting competition and intentionally stifling the free exchange of ideas on their platforms,” the department said. In his remarks Thursday, Delrahim said the debate was important but cautioned that antitrust enforcers need “credible evidence” that the companies are taking steps to harm competition and need to make sure startups are able to take on the tech giants. He said afterward that he supports the Justice Department meeting. “Is any of their conduct in any way limiting the ability of that upstart to challenge their market position in that market where they’re dominating?” Delrahim said. “Big is not bad, but behaving badly is bad.” Source
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