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G7 finance chiefs back plan to leverage frozen Russian assets to fund Ukraine

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G7 finance chiefs back plan to leverage frozen Russian assets to fund Ukraine

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G7 finance ministers have backed the idea of issuing a loan to Ukraine, secured by profits on frozen Russian assets, in an effort to secure financing for Kyiv beyond 2024.

Ministers’ discussions were based on a US proposal that circulated ahead of the gathering in Stresa, Italy, to issue a loan of about $50bn to be repaid with profits from around €190bn Russian central bank assets. The Russian assets are stuck in Belgian central securities depository Euroclear.

On Saturday, ministers said they were “making progress” on options to “bring forward” the profits, according to a draft communique seen by the Financial Times. They added that G7 leaders would be presented with options for how to construct the loan ahead of a summit in June.

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The finance chiefs also vowed to continue to press China to cut industrial subsidies that they said put western rivals out of business, and said implementing the most significant global tax deal for more than a century was “a top priority”. They also raised concerns over Israel’s plans to block Palestinian banks’ access to Israeli lenders — a measure the US and allies believe could destroy the West Bank’s economy.

The G7 — a grouping of advanced economies that includes all of Ukraine’s big western allies — wants to future-proof funding for Kyiv beyond this year, when critical elections take place on both sides of the Atlantic.

Since Russia’s invasion, Ukraine has relied heavily on western aid for military support and to fund crucial public services.

Ukraine’s finance minister Serhiy Marchenko, who attended the G7 meeting, estimated Ukraine’s budget gap in 2025 to be at “more than $10bn” for social and humanitarian needs, adding that “that gap would be much broader” if military needs were included.

He welcomed progress on a loan backed by profits, but said that for Ukraine this was only a “temporary solution for right now, but the general solution should be confiscation” of the Russian assets themselves.

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Janet Yellen, US Treasury secretary, said on Saturday that she did not “want to declare victory here prematurely”, but it was “generally viewed as promising”.

“We will put in a lot of work over the next several weeks,” she said, adding that the proposal had to be “fleshed out” before leaders could consider it.

Yellen said that officials would not be swayed by Russian President Vladimir Putin’s threat to confiscate US citizens’ assets in response. “We’re all very supportive of Ukraine, we’re not going to be deterred.”

Many details of the loan are yet to be agreed, including the amount, who would issue it and how it would be guaranteed if Ukraine defaulted on its debt or if the profits fail to materialise, according to people familiar with the discussions.

Europeans are particularly concerned with “fair-risk sharing”, an official said, fearing Europe would bear the brunt of the financial and legal risks and retaliatory action by Russia because the majority of the assets are held on the continent.

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“The proposal will clearly be a G7-branded proposal and that is why burden-sharing needs to be balanced,” Giancarlo Giorgetti, Italy’s finance minister who chaired the talks, said on Saturday.

The US has also pushed the rest of the G7 to beef up their rhetoric on trade tensions with Beijing.

China’s manufacturing subsidies undermined “our workers, industries, and economic resilience”, the draft communique said, adding that the grouping would “continue to monitor the potential negative impacts of overcapacity and will consider taking steps to ensure a level playing field”.

However, there is discord on what those next steps might be.

While the Biden Administration has already quadrupled tariffs on Chinese electric vehicles, and introduced sharper levies on other clean tech imports to protect green manufacturing jobs in the US, the European Commission has favoured investigations into Chinese subsidies for solar panels, railways and electric vehicles. Beijing retaliated against both US and European imports of chemicals.

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EU members, which are more reliant on export trade with Beijing, signalled greater reluctance to impose levies for fear of escalating a trade war.

While ministers said turning the global two-tiered tax deal agreed in 2021 by more than 135 countries into a reality was a “top priority”, an end-of-June deadline to sign a treaty underpinning one part was unlikely to be met.

Ministers, including Yellen, said opposition from India was delaying progress on the so-called Pillar One, which reallocates part of countries’ right to tax multinational companies to the places where they make sales.

“We are unfortunately at an almost dead point” on Pillar One, Giorgetti said, adding the deadline “risks being missed”.

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Phoenix police have a pattern of violating civil rights, Justice Dept. report says

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Phoenix police have a pattern of violating civil rights, Justice Dept. report says

Darrell Kriplean, president of the Phoenix Law Enforcement Association, which represents about 2,200 Phoenix officers, stands at a lectern with microphones to take a question during a news conference Thursday in Phoenix. A Justice Department report said Phoenix police discriminate against Black, Hispanic and Native American people, unlawfully detain homeless people and use excessive force, including unjustified deadly force.

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PHOENIX — Phoenix police discriminate against Black, Hispanic and Native American people, unlawfully detain homeless people and use excessive force, including unjustified deadly force, according to a sweeping federal civil rights investigation of law enforcement in the nation’s fifth-largest city.

The U.S. Justice Department report released Thursday says investigators found stark racial disparities in how officers in the Phoenix Police Department enforce certain laws, including low-level drug and traffic offenses. Investigators found that Phoenix officers shoot at people who do not pose an imminent threat, fire their weapons after any threat has been eliminated, and routinely delay medical care for people injured in encounters with officers.

The report does not mention whether the federal government is pursuing a court-enforced reform plan known as a consent decree — an often costly and lengthy process — but a Justice Department official told reporters that in similar cases that method has been used to carry out reforms.

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Phoenix police didn’t immediately comment on the report, referring questions to the city. But a top police union official called the Justice Department investigation a “farce,” and warned that a consent decree would hurt officer morale.

“The Department of Justice is not interested in making local police departments and the communities they serve better,” said Darrell Kriplean, president of the Phoenix Law Enforcement Association, which represents about 2,200 officers. “This action demonstrates that they are only interested in removing control of local police from the communities that they serve through consent decrees.”

Phoenix Mayor Kate Gallego said in a statement that city officials would meet June 25 to get legal advice and discuss next steps.

“I will carefully and thoroughly review the findings before making further comment,” she said.

Attorney General Merrick Garland called the report “an important step toward accountability and transparency.” He said in an email that it underscores the department’s commitment to “meaningful reform that protects the civil rights and safety of Phoenix residents and strengthens police-community trust.”

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‘Overwhelming statistical evidence’ of disparities due to discrimination

The Justice Department said Phoenix officers enforce certain laws — such as low-level drug and traffic offenses, loitering and trespassing — more harshly against Black, Hispanic and Native American people than against white people who engage in the same conduct.

Black people in the city are over 3.5 times more likely than white people, for example, to be cited or arrested for not signaling before turning, the report says. Hispanic drivers are more than 50% more likely than white drivers to be cited or arrested for speeding near school zone cameras. And Native American people are more than 44 times more likely than white people — on a per capita basis — to be cited or arrested for possessing and consuming alcohol.

Officers investigating drug-related offenses also were 27% more likely to release white people in 30 minutes or less, but Native Americans accused of the same offense were detained longer, the department said. And Native Americans were 14% more likely to be booked for trespass, while officers cited or released white people accused of the same offense.

There is “overwhelming statistical evidence” that the disparities are due to discrimination, the Justice Department said.

Assistant Attorney General Kristen Clarke, who leads the Justice Department’s Civil Rights Division, criticized Phoenix for “over-policing” homeless people, including arrests without reasonable suspicion of a crime. More than a third of the Phoenix Police Department’s misdemeanor arrests and citations were of homeless people, the report says. The DOJ investigation began in August 2021.

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Litigation is an option if the Justice Departments’ efforts to secure a consent decree are unsuccessful.

“We remain very hopeful that we can build on the track record of success that we have had in other jurisdictions across our country and put in place a consent decree that contains the strong medicine necessary to address the severe violations identified,” Clarke said.

Phoenix Police officers in helmets and face shields and holding large body shields labeled

Phoenix Police officers watch protesters rally on June 2, 2020, during demonstrations over the death of George Floyd.

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Similar DOJ investigations in Albuquerque, Baltimore and elsewhere have found systemic problems related to excessive force and civil rights violations, some resulting in costly consent decrees that have lasted for years.

In Phoenix, a 2020 case accusing 15 protesters of being in an anti-police gang was dismissed because there wasn’t credible evidence; in 2017, a “challenge coin” was circulated among officers depicting a gas mask-wearing demonstrator getting shot in the groin with a projectile; and in June 2019, cellphone video emerged showing officers pointing guns when they confronted an unarmed Black couple with two small children they suspected of shoplifting.

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Poder In Action, a Phoenix group that advocates for people of color and workers, said the findings were no surprise.

“We never needed a DOJ investigation to tell us this,” the group said in a statement. “The data and the stories from residents have been telling us this for years.”

The report said some police shootings happened because of officers’ “reckless tactics,” and that police “unreasonably delay” providing aid to people they have shot and use force against those who are unconscious or otherwise incapacitated.

In one instance, police waited more than nine minutes to provide aid to a woman whom officers had shot 10 times, the Justice Department said. The woman died.

The investigation zeroed in on the city’s 911 operations. Even though Phoenix has invested $15 million to send non-police responders to mental health calls, the city hasn’t given the 911 call-takers and dispatchers necessary training.

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Officers assume people with disabilities are dangerous and resort to force rather than de-escalation tactics, leading to force and criminal consequences for those with behavioral health disabilities, rather than finding them care, the Justice Department said.

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Tesla shareholders approve Elon Musk’s $56bn pay deal and Texas move

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Tesla shareholders approve Elon Musk’s $56bn pay deal and Texas move

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Tesla shareholders voted to reapprove chief executive Elon Musk’s $56bn pay and to reincorporate the electric-vehicle maker in Texas, handing him significant victories as he seeks to reassert control over the company.

The preliminary results, announced at Tesla’s annual meeting in Austin on Thursday, will strengthen the company’s hand as it attempts to overturn a January decision by a Delaware court to void the 2018 package of stock options — the largest in US history — due to concerns about its size and the independence of the board.

While the vote does not supersede the court’s decision, the ratification could prove instrumental in persuading the judge to reverse or amend her stance. Musk’s grip on the company would be tightened, boosting the chief executive’s stake to more than 20 per cent from his current 13 per cent.

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Musk and the board have for the past few months led a campaign to rally Tesla’s retail shareholders — who own about 30 per cent of the company — to back the two resolutions in what amounted to a referendum on the mercurial leadership of one of the world’s richest people.

They also lobbied institutional investors to go against the guidance of proxy advisers ISS and Glass Lewis, who opposed the “outsized” and “excessive” pay package.

Two of Musk’s crucial allies on the board were also re-elected despite opposition from proxy advisers: former 21st Century Fox chief executive James Murdoch and Musk’s brother Kimbal.

After the polls closed just after 4pm in Austin, Musk emerged on stage to address a rapturous crowd chanting his name, jumping up and down in front of a blue and pink neon sign in the shape of Texas advertising the “cyber roundup”, as its annual meeting is branded.

“Hot damn I love you guys,” Musk said to the carefully-selected audience of retail investors. “We have the most awesome shareholder base of any public company . . . we are not starting a new chapter, but opening a new book.”

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The victories were not unexpected after Musk posted on X on Wednesday night that both resolutions were “currently passing by wide margins!”

Tesla shares rose 3 per cent on Thursday after his post, but have fallen 27 per cent so far this year.

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Biden says he won't commute his son's sentence in his federal gun case

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Biden says he won't commute his son's sentence in his federal gun case

President Joe Biden made clear Thursday that in addition to not pardoning his son Hunter following his conviction on three gun-related charges this week, he won’t commute his sentence either.

Asked during a news conference with Ukrainian President Volodymyr Zelenskyy during the G7 summit in Italy if a commutation was on the table, Biden said, “No.”

Biden also spoke briefly about his son’s situation in response to another question, and reiterated that he won’t pardon him.

“I‘m extremely proud of my son Hunter,” Biden said. “He has overcome an addiction. He’s one of the brightest, most decent men I know, and I am satisfied that I’m not going to do anything. I said I abide by the jury decision. I will do that, and I will not pardon him.”

President Joe Biden after signing a bilateral security agreement with Ukrainian President Volodymyr Zelenskyy on Thursday at the G7 summit at Savelletri, ItalyAndrew Medichini / AP

Before Hunter Biden was convicted on Tuesday, the president stated that he would accept whatever the jury decides in the case.

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Asked in an ABC News interview last Thursday if he would rule out a pardon, the president said, “Yes.” Asked if he would accept the outcome of the jury trial, he again said, “Yes.”

Hunter Biden was found guilty on Tuesday of three felony counts related to his possession of a gun while using narcotics in the first trial of the offspring of a sitting U.S. president.

Two of the counts carry maximum prison sentences of 10 years, while the third has a maximum of five years. Under federal sentencing guideline recommendations, Biden could be sentenced to over a year in prison, but the judge could sentence him to more or less time. Each count also carries a maximum fine of $250,000.

No sentencing date has been set.

Hunter Biden also faces federal tax charges in California, a case that is set to go to trial in September.

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