Largest banking group in Japan, Mitsubishi UFJ Financial Group (MUFG), will cut the pay of its CEO and five other executives due to breaches of ‘firewall’ regulations at its banking and securities arms. The Financial Services Agency (FSA) ordered MUFG to submit business improvement plans after discovering these breaches, marking a significant regulatory action.
Group CEO Hironori Kamezawa and five other executives will have their monthly salaries reduced by 30% for two to five months. Additionally, three former directors at MUFG’s banking unit and one at its securities arm are required to return 10% to 30% of their three-month salary. Kamezawa, who earned 339 million yen ($2.16 million) in the last fiscal year, will also face these cuts.
The FSA found at least 26 cases where confidential client information was shared between MUFG Bank and its two securities partnerships with Morgan Stanley from 2020 to 2023. MUFG Bank also offered preferential lending rates to clients doing business with these brokerages, violating regulations that prohibit sharing customer data without consent.
In response, MUFG has submitted a business improvement plan to the FSA. The company is taking measures to address the regulatory breaches and ensure compliance with financial regulations in the future.
In a pioneering move, a technology company, Google, contracts with a broadcasting company to cover the Olympic and the Paralympic Games. NBC Universal, the official broadcast agency of the Olympic Games in the US, collaborates with the tech giant and Sports Committees to attract younger audiences and those who have grown accustomed to viewing short clips online.
How it is intended to work is sports commentators will use Google’s Gemini AI to narrate competitions, generate recaps, as an assistant to anchors, answer questions posed online and equip them with the content of informed research, and even entertain audiences.
Currently, Google’s AI overviews are used to provide synopses to queries posed in Google searches. These give ready-made short responses to questions posed by users without directing them to third-party websites via links.
A recent survey conducted by Nikkei Research for Reuters shows a significant divide among Japanese companies regarding AI adoption. Of the 250 firms that responded, 24% have integrated AI into their operations, while 35% plan to do so. However, 41% have no plans to implement the technology, highlighting varying levels of enthusiasm for AI across corporate Japan. Key motivations for adopting AI include addressing workforce shortages, reducing labour costs, and accelerating research and development.
Despite Japan’s initially laid back approach to AI regulation, several obstacles hinder AI adoption, including employee anxiety over potential job losses, lack of technological expertise, high capital expenditure, and concerns about AI’s reliability. Cybersecurity also emerged as a critical issue, with 15% of respondents experiencing cyberattacks in the past year and 9% reporting attacks on their business partners. To enhance cybersecurity, 47% of firms outsource their defence, while 38% rely on in-house specialists.
The survey also touched on the controversial topic of Japan’s surname law, which mandates that spouses use the same surname. Half of the respondents support changing the law, a move prompted by the Keidanren business lobby’s recent appeal to the government. Supporters argue that the current system undermines individual dignity and freedom, particularly for women, while opponents believe separate surnames could weaken family bonds. Only 14% of firms believe the change would boost employee morale, and 10% think it would aid hiring efforts, with the majority expecting no significant impact on business.
A recent study has revealed that AI chatbots pose significant risks to children, who often view them as lifelike and trustworthy. Dr Nomisha Kurian from the University of Cambridge calls for urgent action to prioritise ‘child-safe AI’ in the development of these technologies.
Kurian’s research highlights incidents where AI chatbots provided harmful advice to children, such as Amazon’s Alexa instructing a child to touch a live electrical plug and Snapchat’s My AI giving tips on losing virginity.
These cases underscore the ’empathy gap’ in AI, where chatbots fail to respond appropriately to children’s unique needs and vulnerabilities.
The study proposes a 28-item framework to help developers create safer AI by working closely with educators and child safety experts. Kurian argues that AI has great potential if designed responsibly, but proactive measures are essential to protect young users.
Pittsburgh-based startup Skild AI has emerged from stealth mode with a $300 million funding round led by Jeff Bezos’ fund and Japan’s Softbank Group. Founded by Carnegie Mellon University professors Deepak Pathak and Abhinav Gupta, the company aims to build a ‘general-purpose brain’ for robots.
Skild AI’s AI model, trained on more data than its competitors, can be retrofitted to existing hardware. Pathak highlighted the model’s unparalleled capabilities across various robots and tasks, indicating its potential to transform automation in real-world environments.
With applications in household tasks and industrial work, Skild AI’s technology promises to reduce robot costs and address labour shortages. The company, now valued at $1.5 billion, is hiring engineers from top tech firms and Carnegie Mellon University.
The French competition authority has officially launched an investigation into chipmaker Nvidia for suspected anti-competitive behaviour, confirming ongoing scrutiny of the company’s practices. Benoit Coeure, the agency’s president, affirmed during a press briefing that Nvidia could face charges pending the outcome of the investigation.
Earlier reports, based on insider information, indicated that Nvidia was likely to be formally charged by the antitrust regulator in France. The investigation focuses on allegations of practices that may hinder competition within the market.
Nvidia, a prominent player in the semiconductor industry, faces increasing regulatory scrutiny globally amid concerns over its market dominance and business practices. The outcome of the investigation by the French authority could have significant implications for Nvidia’s operations and market strategy moving forward.
Poland’s antitrust and consumer protection watchdog, UOKiK, has fined PayPal Europe 106.6 million zlotys ($27.3 million) for failing to clearly outline activities that could incur penalties in its contractual clauses. UOKiK stated that PayPal’s descriptions of prohibited activities could have been more precise, making it difficult for users to understand what actions were not allowed and the potential consequences.
UOKiK’s head, Tomasz Chrostny, criticised PayPal’s clauses as general, ambiguous, and incomprehensible, giving the company excessive discretion to determine whether a user has committed a prohibited act and what penalties to impose. That could include actions like blocking money on accounts.
PayPal responded by emphasising its commitment to fair treatment and transparent communication with customers. The company stated that it has been cooperating with UOKiK during the investigation and is reviewing the decision. PayPal also noted that the decision is not final and that it has the opportunity to appeal in court.
According to blockchain data, a major Cambodian payments firm, Huione Pay, received over $150,000 in cryptocurrency from a digital wallet linked to the North Korean hacking group Lazarus. The funds were sent between June 2023 and February this year from an anonymous wallet used by Lazarus to launder money stolen from three crypto companies through phishing attacks. The FBI reported that Lazarus stole around $160 million from Atomic Wallet, CoinsPaid, and Alphapo last year to fund North Korea’s weapons programs.
Huione Pay, based in Phnom Penh, stated it was unaware of receiving funds indirectly from the hacks and cited multiple transactions between its wallet and the source as the reason. The company declined to explain why it had received the funds or provide details on its compliance policies. Despite blockchain tools allowing companies to identify high-risk wallets, Huione Pay claimed it had no control over the anonymous wallet’s transactions.
The National Bank of Cambodia (NBC) prohibits payment firms like Huione Pay from dealing with cryptocurrencies due to risks like money laundering and financing terrorism. The NBC indicated it might take corrective measures against Huione Pay. Meanwhile, US blockchain analysis firms reported that Huione Pay was among several platforms receiving stolen crypto, which was converted into different currencies, including tether (USDT), to obscure the money trail. Southeast Asia has become a hotspot for high-tech money laundering and cybercrime operations, highlighting the need for stronger regulatory measures.
Taiwan Semiconductor Manufacturing Co (TSMC), the leading producer of advanced chips for AI applications, is set to report a 30% rise in second-quarter profit on Thursday, driven by soaring demand. The world’s largest contract chipmaker, which counts Apple and Nvidia among its clients, has seen its stock—and the broader Taiwan market—reach record highs. Last week, TSMC’s American Depositary Receipts surpassed a trillion-dollar market value.
For the quarter ending 30 June, TSMC is expected to announce a net profit of T$236.1 billion ($7.25 billion), a significant increase from the T$181.8 billion reported in the same period last year. The company recently reported a substantial rise in second-quarter revenue, exceeding market expectations. Analysts like Li Fang-kuo from President Capital Management Co. anticipate a strong third-quarter outlook for all of TSMC’s products.
TSMC is heavily investing in expanding its production capacity, including spending $65 billion on three new plants in Arizona. However, the majority of its manufacturing will remain in Taiwan. The company is expected to maintain its capital expenditure guidance for this year at $28 billion to $32 billion, with 70% to 80% allocated to advanced technologies. KGI Securities’ Chu Yen-min suggests TSMC raise its capital spending due to favourable market conditions, which could further boost its stock price and support the broader market.
Why does this matter?
TSMC, often called the ‘sacred mountain protecting the country’ for its crucial role in Taiwan’s economy, remains a dominant player in the semiconductor industry despite challenges from Intel and Samsung. The AI boom has significantly increased TSMC’s stock price, which has surged 75% this year, outpacing the 33% gain in the broader market.
Bitcoin surged to a two-week high on Monday following the attempted assassination of US presidential candidate Donald Trump. Trump, who was shot in the ear during a rally in Pennsylvania, is recovering well, according to his campaign. The attack is seen by some investors as boosting his chances of winning the upcoming election, leading to increased trades betting on his victory.
The cryptocurrency saw an 8.6% rise, reaching $62,508, with a session high of $62,698, marking a 47% annual gain. Ether also experienced a boost, climbing 6.8% to $3,322. Trump has criticised Democratic efforts to regulate the crypto sector and positioned himself as a pro-crypto candidate, which has resonated with the market.
Market analyst Tony Sycamore from IG noted that the assassination attempt has significantly bolstered Bitcoin, adding that the cryptocurrency could see further gains. Trump is set to speak at the Bitcoin 2024 conference in Nashville on 27 July, a move likely to keep the crypto market’s focus on his campaign. Despite a rocky start to July, Bitcoin’s recent rebound suggests it could approach $65,000 by the end of the week.
