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The Department for Transport (DfT) says rail franchising has been “ended” as it seeks a new model for the rail network in the wake of the coronavirus crisis.
It was confirmed on Monday morning that emergency measures, introduced to keep trains running after the outbreak of COVID-19, had been partially extended for up to 18 months pending the introduction of a “simpler and more effective structure” that is being developed.

The department has taken on franchise holders’ revenue and cost risks since March, at a cost to taxpayers of at least £3.5bn.

Image: Train services remain far less busy than pre-lockdown
The DfT said “significant” financial support would still be needed as operators moved to the new “transitional contracts” that will see the public purse continue to pay the companies to run services but at a slightly reduced rate.
The new so-called Emergency Recovery Management Agreements (ERMAs) ensure the companies will not be exposed to changes in passenger demand – kept low by pandemic restrictions and a reluctance to return to offices.

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Transport Secretary Grant Shapps promised the looming reforms would eradicate the complex nature of the franchise set-up.

“The model of privatisation adopted 25 years ago has seen significant rises in passenger numbers, but this pandemic has proven that it is no longer working.

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“Our new deal for rail demands more for passengers. It will simplify people’s journeys, ending the uncertainty and confusion about whether you are using the right ticket or the right train company.
“It will keep the best elements of the private sector, including competition and investment, that have helped to drive growth – but deliver strategic direction, leadership and accountability.

Where jobs have been lost in the UK economy
Where jobs have been lost in the UK economy

Do we need HS2 if employees work at home?

“Passengers will have reliable, safe services on a network totally built around them. It is time to get Britain back on track.”
The RMT rail union responded to the announcement by demanding the network was placed back under full public ownership.
FirstGroup, which currently runs the Avanti West Coast, Great Western, South Western and TransPennine Express franchises, was among operators to welcome the ERMAs.
Chief executive, Matthew Gregory, said: “We are pleased that the vital nature of rail services to communities and local economies is being recognised.
“Passengers can be confident that public transport is safe and across our rail networks we have increased service levels to provide more capacity as schools restart and many more workplaces and other facilities reopen.
“We are now operating around 90% of the rail services we were prior to the pandemic. We will continue to bring all our expertise to bear alongside government and industry partners to deliver the next phase of recovery of the rail network.”
Its shares – down more than 60% in the year to date – fell by almost 3% when trading opened on Monday.
Go-Ahead, the listed company behind the Govia joint venture franchises including Southern, saw its stock roll back by 5%.

Asking prices for three and four-bedroom homes have hit record highs as buyers battle for more space during the coronavirus pandemic, according to a property website.
Rightmove said activity – aided by the current stamp duty holiday – was being driven by high demand for gardens and more space to work from home as COVID-19 disrupts day-to-day life.

It estimated that September sales were 40% up on the same month a year ago, with “second stepper” homes – flats or semi-detached properties with between three to four bedrooms – reaching a record average asking price of £291,618.

Where jobs have been lost in the UK economy
Where jobs have been lost in the UK economy

The website reported that asking prices rose 0.2% overall during the month to almost £320,000 – 5% up on a year ago – and areas outside London and the South East were seeing the largest leaps.
Its study builds on other recent surveys which suggest values have hit record levels following the easing of the lockdown on the back of pent up demand.

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Chancellor Rishi Sunak moved to support the recovery by announcing in July that the threshold for paying stamp duty would be raised temporarily from £125,000 to £500,000 until 31 March.

Can the economy recover as furlough ends?

But market experts have cautioned that the price rally is likely to run out of steam later in the year and into 2021 because of the growing crisis for jobs and incomes caused by the pandemic.

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Tim Bannister, Rightmove’s director of property data, pointed to strong competition for properties on the market.
“With overall asking prices just a few hundred pounds shy of July’s record, and buyer demand at an all-time high, those currently looking for their next home are likely to find that only offers close to the asking price will be considered, especially for larger homes,” he said.

Some of the biggest banks in the world have been accused of allowing criminals to launder dirty money, according to an investigation based on leaked internal reports.
Over 2,100 suspicious activity reports (SARs) covering more than $2trn (£1.5trn) in transactions were leaked to BuzzFeed News and shared with the International Consortium of Investigative Journalists (ICIJ).

These reports, and more than 17,600 other records obtained by the ICIJ, allegedly show how senior banking officials allowed fraudsters to move money between accounts in the knowledge that the funds were being generated or used criminally.
Covering transactions between 1999 and 2017, the SARs were leaked from the US Financial Crimes Investigation Network (FinCEN), an agency which is part of the US Treasury and tasked with tackling money laundering.
Two weeks ago FinCEN warned that media organisations were preparing to publish a story on documents that had been obtained illegally, before last week announcing that it was seeking public comments on how to improve the anti-money laundering system in the US.

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According to the ICIJ, the $2trn in suspicious transactions identified within the documents represents less than 0.02% of the more than 12 million SARs that financial institutions filed with FinCEN between 2011 and 2017.

In the key findings of its report, the ICIJ alleged: “Big banks shift money for people they can’t identify and in many cases fail to report suspect transactions until years after the fact.”

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“Government fines and threats of criminal prosecutions against banks haven’t stopped a tide of illicit payments,” the organisation adds, raising questions about money-laundering enforcement.

Image: HSBC, Standard Chartered, Deutsche Bank and Bank of New York Mellon were the other financial firms named in the investigation
BuzzFeed News described the documents as revealing “how the giants of Western banking move trillions of dollars in suspicious transactions, enriching themselves and their shareholders while facilitating the work of terrorists, kleptocrats, and drug kingpins”.
Among the criminal organisations named in the reports are the Al Zarooni Exchange, which was sanctioned by the US Treasury in 2015 for laundering funds for the Taliban.
The SARs reportedly also show how Russian and Ukrainian oligarchs avoid sanctions to move their money into the West.
Five global banks were named in the investigation: JPMorgan Chase, HSBC, Standard Chartered, Deutsche Bank and Bank of New York Mellon.
The ICIJ reported that some of these banks continued to work with “mobsters, fraudsters or corrupt regimes” even after they were warned by US officials that they would face criminal prosecutions for doing so.
The SARs were written by internal compliance officers at these banks, and are “not necessarily evidence of criminal conduct or other wrongdoing” the ICIJ reported.
London-based HSBC said it would not comment on suspicious activity reporting but said the documents referred to historical information which predated the conclusion of its deferred prosecution agreement with the US over its failures to prevent Mexican drug cartels from laundering hundreds of millions of dollars.
As part of the conclusion of that agreement, HSBC said that the authorities were satisfied with its work tackling money laundering.

Image: Deutsche Bank said ‘a number of historic issues’ relating to its business ‘are well known to our regulators’
Standard Chartered, which is also based in the UK, responded to the reports by stating: “The reality is that there will always be attempts to launder money and evade sanctions; the responsibility of banks is to build effective screening and monitoring programmes to protect the global financial system.”
“We take our responsibility to fight financial crime extremely seriously and have invested substantially in our compliance programmes,” the bank added.
Hong Kong-traded HSBC shares fell more than 4% at one stage on Monday while Standard Chartered saw a drop of almost 4%.
In its response, Germany’s Deutsche Bank also stressed that the ICIJ “reported on a number of historic issues” and said “those relating to Deutsche Bank are well known to our regulators”.
“The issues have already been investigated and led to regulatory resolutions in which the bank’s co-operation and remediation was publicly recognised,” Deutsche Bank added.
The Bank of New York Mellon said it takes its role “in protecting the integrity of the global financial system seriously, including filing suspicious activity reports” and added that it fully complied with all applicable laws and regulations.

Image: The Bank of New York Mellon said it takes its role ‘in protecting the integrity of the global financial system seriously’
JPMorgan Chase, which is also based in New York, stated: “We report suspicious activity to the government so that law enforcement can combat financial crime, and have thousands of people and hundreds of millions of dollars dedicated to this important work.
“We have played a leadership role in anti-money laundering reform that will modernise how the government and law enforcement combat money laundering, terrorism financing and other financial crimes.”
Anti-corruption group Transparency International UK said the leak “shows how UK banks continually fail to address suspicious activity and instead offered their services to those with money to hide”.
Its chief executive Daniel Bruce said: “These revelations are a damning indictment of the system that is supposed to prevent the UK and other financial centres becoming havens for dirty money.
“The government should respond rapidly to this significant investigation in order to demonstrate that the UK is serious about tackling dirty money.”
Alex Cobham, chief executive at Tax Justice Network, said: “Swift and robust action is needed, including potential criminal charges, or banks will simply continue to treat the prospects of being caught and fined as a simple cost of business.”

Donald Trump’s plan to block downloads of the Chinese messaging and payment app WeChat has been blocked by a federal judge in California on first amendment grounds.
The ruling put a temporary block on the president’s executive order which would have effectively banned the app on Sunday, despite Mr Trump and his administration describing it as a national security threat.

Judge Laurel Beeler said the government’s actions would affect WeChat users’ first amendment rights – as a ban on the app removes their platform for communication.

Image: Donald Trump had sought to ban WeChat through an executive order
WeChat is popular with many Chinese-speaking Americans and serves as a lifeline to friends, family, customers and business contacts in China.
It is owned by Chinese tech giant Tencent.

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A preliminary injunction against the US government’s ban was brought by a non-profit organisation called the US WeChat Users Alliance, which says it has no connection to Tencent.

The group, which features prominent Chinese-American lawyers, said the executive order risked infringing the constitutional rights of the app’s 19 million regular users in the country.

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According to the US government, WeChat posed a national security threat by providing the Chinese Communist Party with the ability to maliciously collect data on American citizens.
The Department of Justice claimed this data included “network activity, location data, and browsing and search histories”, data which social media apps typically collect on their users, although they are not typically based in China.
Tencent denies the allegations, and says that messages on its app are private.

TikTok: What data does it collect on its users, and how do other apps compare?

The ruling follows Donald Trump saying he has given his “blessing” to a proposed deal that could prevent another Chinese-owned app, TikTok, from being banned by the same executive order.
He told reporters at the White House he is backing a deal with Oracle and Walmart that would create a new company to oversee TikTok’s US operations.
Mr Trump said the new company would be “totally controlled by Oracle and Walmart”.
People in the US had been set to be banned from downloading the video-sharing app on Sunday, following White House concerns about the security of user data.
An earlier statement from the US commerce department said: “The Chinese Communist Party (CCP) has demonstrated the means and motives to use these apps to threaten the national security, foreign policy, and the economy of the US.”
It added that the apps posed “unacceptable risks” to national security.
But the president has now said he approves the deal “in concept” and the security will be “100%”, adding: “I have given the deal my blessing.”

Ministers are in talks to extend a moratorium aimed at preventing a deluge of company insolvencies amid fears that renewed trading restrictions will tip thousands of businesses beyond the brink of collapse.
Sky News has learnt that officials are discussing an extension of the ban on statutory demands being used as the basis for winding-up petitions, which has been in place since late April.

The move is expected to be finalised within a matter of days, given that the moratorium expires at the end of the month.
Sources said this weekend that an extension was not yet guaranteed but was “overwhelmingly likely”.
The measure was one of several included in the government’s Corporate Insolvency and Governance Act, which became law in June.

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Others, including a moratorium on directors’ liability for wrongful trading, also expire at the end of September and are said to be the subject of discussions about an extension.

Business groups including the Institute of Directors have called on ministers to act – with the demand acquiring greater urgency as a result of warnings that the country is edging towards the possibility of a second national lockdown.

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Roger Barker, the IoD director of policy and corporate governance, said recently: “Without [an extension to] these measures, we could see some entirely preventable company collapses, putting our economic recovery and jobs at risk.
“Directors must be in a position to see their organisations through the crisis, they shouldn’t be penalised for acting responsibly amid unprecedented circumstances.”
The Department for Business, Energy and Industrial Strategy, which oversaw the introduction of the emergency insolvency measures, declined to comment.

Donald Trump says he has given his “blessing” to a proposed deal that could prevent TikTok from being banned in the US.
He told reporters at the White House he is backing a deal with Oracle and Walmart that would create a new company to oversee TikTok’s US operations.

Mr Trump said the new company would be “totally controlled by Oracle and Walmart”.
People in the US were set to be banned from downloading the video-sharing app – as well as another Chinese app, WeChat – on Sunday, following White House concerns about the security of user data.

Image: Donald Trump said he has approved the deal ‘in concept’
An earlier statement from the US commerce department said: “The Chinese Communist Party (CCP) has demonstrated the means and motives to use these apps to threaten the national security, foreign policy, and the economy of the US.”

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It added that the apps posed “unacceptable risks” to national security.

But the president has now said he approves the deal “in concept” and the security will be “100%”, adding: “I have given the deal my blessing.”

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Reuters news agency reported on Thursday the new company, called TikTok Global, will have a majority of American directors, a US chief executive and a security expert on board.
It is expected to create at least 25,000 new jobs and will be based in Texas, the president said.

What data does it collect on its users, and how do other apps compare?

Oracle and Walmart are expected to take significant equity stakes and ByteDance – which owns TikTok – has agreed to significant security safeguards, with Oracle housing all data and having the right to inspect the app’s source code.
However, China must still approve the deal.
TikTok said in a statement: “We are pleased that the proposal by TikTok, Oracle, and Walmart will resolve the security concerns of the US Administration and settle questions around TikTok’s future in the US.”
It added: “Our team works tirelessly to provide a safe and inclusive platform and we’re thrilled that we will be able to continue serving our amazingly diverse and creative community.”
Mr Trump said: “We’ll see whether or not it all happens.”
It is not immediately clear if the commerce department will row back on its plans to force Google and Apple to stop offering TikTok on their US app stores on Sunday.

The Wall Street bank Goldman Sachs is to snub the £2bn flotation of one of Britain’s fastest-growing technology companies amid US prosecutors’ efforts to extradite its biggest investor.
Sky News has learnt that Goldman has declined to seek a role on the initial public offering (IPO) of Darktrace, a leading player in the provision of artificial intelligence (AI) cybersecurity services.

Banking sources said that executives at Goldman had raised concerns about the ongoing legal ramifications of billionaire Mike Lynch’s $11bn sale of the software company Autonomy to Hewlett Packard (HP) in 2011.
Mr Lynch, one of the most prominent figures in Britain’s technology industry, faces an extradition hearing early next year following the decision by US authorities to charge him with 17 counts of securities and wire fraud.
The businessman submitted himself for arrest in February and was granted bail in return for £10m security.

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Mr Lynch has always denied the charges against him.

His venture capital firm, Invoke Capital, became the first investor in Darktrace after it was founded in 2013, since when it has grown rapidly, boasting more than $200m in annual revenue.

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Insiders said this weekend that investment banks had been asked to pitch next week for the mandate to advise on Darktrace’s prospective London float, which is expected to seek hundreds of millions of pounds from the sale of new and existing shares.
People close to the company said that eight leading investment banks, thought to include Credit Suisse, Morgan Stanley and UBS, submitted credentials to Darktrace ahead of a deadline this week.
One bank participating in the process is understood to have told the company that “due diligence requirements would not be an impediment to the process, given our strong working knowledge of the company”.
Compliance officials at some of the eight banks are, however, understood to retain reservations about participating in the IPO.
Among the questions they are said to have raised are whether underwriting the float could constitute a potential breach of Britain’s Proceeds of Crime Act, as well as the continuing close relationship between Darktrace and Invoke.
Although Mr Lynch stepped down from the Darktrace board in 2018, Invoke remains the company’s largest shareholder.
The entrepreneur has also relinquished some of his other board roles but remains involved with start-ups such as Luminance, a law-focused AI company.
Sky News revealed earlier in the summer that the private equity giant KKR had increased its stake in Darktrace as part of a reorganisation of the company’s shareholder structure.
Bankers have also questioned their ability to participate in the IPO process because Sushovan Hussain, the former Autonomy finance chief and a Darktrace shareholder, was sentenced to five years in a US prison for fraud in May 2019.
Goldman’s decision not to seek a role on Darktrace’s float underlines the sensitivity within bulge-bracket banks about the issues raised by its plan to go public.
The London Stock Exchange has been keen to persuade Darktrace to list in the UK against stiff competition from American exchanges.
Cybersecurity companies which have floated in the US, including Crowdstrike, have seen their shares surge immediately after listing, suggesting that Darktrace might quickly be valued at well over £2bn.
Last week saw the London’s biggest IPO for several years with the listing of The Hut Group, the digital consumer brands and logistics group.
Darktrace had been considering appointing an independent investment banking adviser to coordinate its IPO process but has now decided against doing so, according to City sources.
The company recently named Poppy Gustafsson – herself a former Autonomy colleague of Mr Lynch – as its sole chief executive, ending a joint leadership structure with co-founder Nicole Eagan.
More than $100m of new capital was recently injected into Darktrace by existing investors said to include KKR and Summit Partners, a US-based private equity firm.
Headquartered in Cambridge, Darktrace supplies artificial intelligence-based cybersecurity software to corporate customers, helping them to detect abnormal behaviour on their networks.It recently said it had passed $1bn in “cumulative bookings”, suggesting that its order-book has been substantially boosted by the coronavirus-inspired switch to remote working for millions of employees of multinational companies.Growing demand for its products has underpinned some of its investors’ appetite to buy more Darktrace stock, with recent cyberattacks on companies such as easyJet and Honda again reinforcing the extent to which the security of multinationals’ networks and data is now a fixture on boardroom agendas.Darktrace now employs more than 1200 people, and operates from 44 offices, with dual headquarters in Cambridge and San Francisco.Its blue-chip corporate customers have included AIG, BT Group, Jimmy Choo, the Science Museum Group and William Hill.
In February, Darktrace appointed Cathy Graham, who has been involved in a series of technology company IPOs, as its chief financial officer.
KKR and Summit invested in the company as part of previous funding rounds in 2015 and 2016.
It also raised money in a Series-E round in 2018, when it said Vitruvian Partners, another private equity firm, had come on board as a shareholder.Poppy Gustafsson, Darktrace chief executive, told The Sunday Times in a recent interview that business had boomed during the coronavirus crisis.”A lot of the attacks are leveraging the pandemic,” she said.
“People need access to information very quickly, so are susceptible to clicking on links that turn out to be malware.”
Darktrace and Goldman declined to comment on Saturday.

Travel and hospitality stocks have been hit by fears of a second lockdown, as the number of UK coronavirus cases increases.
Airlines were the worst-hit: International Airlines Group, which owns British Airways, Aer Lingus and Iberia, closed down 14.6%.

EasyJet closed down almost 9.2%, Ryanair was down almost 4% and Wizz Air was down 5%. Rolls-Royce, which makes aircraft engines, lost 5.1%.

Image: British Airways is among the airlines struggling to recover from the pandemic
It comes after news that, with COVID-19 cases now doubling every seven to eight days, Prime Minister Boris Johnson is considering national restrictions for a short period to “short-circuit” the virus.
Proposals include allowing essential travel to schools and workplaces but closing or restricting restaurants and bars, and banning gatherings between different households.

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It has been reported that these restrictions could last for two weeks.

Joshua Mahony, senior market analyst at IG, said: “The threat of further a second round of COVID restrictions in London has dented confidence, with the travel sector in particular feeling the heat as we head into the weekend.

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“While localised restrictions have become somewhat normalised of late, the economic importance of London means we are likely to see a more significant market reaction if the growth in cases leads to significant economic consequences.

Where jobs have been lost across the UK

“From a tourism perspective, the rise in COVID cases in the UK does little to help boost sentiment around travel stocks. While we have become accustomed to the UK imposing quarantine restrictions on visitors from specific countries, the prospect of quarantines on UK tourists holidaying abroad would put a major stake in heart of the travel industry.”
Cruise company Carnival closed down 7.9% and InterContinental Hotels Group, which owns Holiday Inn and Crowne Plaza among others, was down 4.5%.

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Pub chain JD Wetherspoon closed down 1.2%, and Restaurant Group, which counts Wagamama among its restaurants, lost 2.4%. Whitbread, which owns hotel chain Premier Inn and food businesses such as Beefeater, closed down 2.3%.
Russ Mould, investment director at AJ Bell, said: “Amid growing chatter about a potential two-week nationwide lockdown in October in the UK, it was perhaps no surprise to see investors lose interest in stocks that could be negatively affected by such activity.”
Supermarkets held up well, however, having experienced higher demand during the last lockdown – particularly in online shopping. Ocado closed up 3.9%, Tesco and Sainsbury’s both gained 2% and Morrisons was up 1.3%.
The FTSE 100 slipped 0.7%, with some of the index’s more internationally-focused members limiting the damage caused by the losses in travel-related stocks, but the more domestically-focused FTSE 250 closed down 0.9%.

Kwik Fit, one of Britain’s leading tyre-fitting and automotive repair groups, is to be put up for sale by its Japanese owner almost a decade after it last changed hands.
Sky News has learnt that Itochu, the conglomerate which bought Kwik Fit for more than £630m in 2011, has asked investment bankers at Nomura to examine strategic options for the company.

A final decision about its future is yet to be determined, but City sources said that a sale process was highly likely.
An auction of Kwik Fit would come soon after National Accident Repair Services, a smaller rival operator, was rescued through an insolvency process by the listed company Redde Northgate.
Kwik Fit, which employs thousands of people, describes itself as one of the world’s largest independent automotive parts, repair and replacement specialists.

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In the UK, it trades from more than 600 service centres as well as 200 mobile tyre-fitting vehicles, which it claims makes it the UK’s leading tyre, exhaust, brake and MOT specialist.

The company will reach its 50th anniversary next year amid a turbulent environment for Britain’s automotive industry, with concerns about tariffs arising from a no-deal Brexit continuing to haunt car manufacturers, and vehicle sales continuing to suffer amid the coronavirus pandemic.

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It was unclear on Friday how much Itochu might expect to recoup from a sale.
Earlier this year, Itochu sold a portfolio of 21 Kwik Fit service centres to property investors, but there is little public detail of how the business has fared over the last year.
Kwik Fit and Nomura declined to comment.

People in the US will be banned from downloading TikTok from this Sunday.
The US commerce department said that starting 20 September, Americans will not be able to get the popular video-sharing app.

The ban will also cover the messaging app WeChat.

Image: Chinese messaging app WeChat is also covered by the ban
President Donald Trump could still withdraw the ban before Sunday evening – if a deal is done between TikTok’s Chinese owners ByteDance and US technology giant Oracle.
The two firms are in talks to create a new company, TikTok Global, that aims to address the White House’s concerns about the security of its users’ data, with Oracle having moved ahead of Microsoft in the race for a deal.

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TikTok has 100 million users in the US.

A statement from the department said: “The Chinese Communist Party (CCP) has demonstrated the means and motives to use these apps to threaten the national security, foreign policy, and the economy of the US.

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“Today’s announced prohibitions, when combined, protect users in the US by eliminating access to these applications and significantly reducing their functionality.”
It went on: “While the threats posed by WeChat and TikTok are not identical, they are similar. Each collects vast swaths of data from users, including network activity, location data, and browsing and search histories.
“Each is an active participant in China’s civil-military fusion and is subject to mandatory cooperation with the intelligence services of the CCP.
“This combination results in the use of WeChat and TikTok creating unacceptable risks to our national security.”

Trump: ‘I don’t mind’ if Microsoft buys TikTok

TikTok has said it would never share user information with Chinese authorities.
Bytedance and Oracle have submitted a proposal for a deal in which TikTok would become a separate US company with with an American board.
There would also be a security committee – the head of which would need government security clearance.
Microsoft had previously been in the running to take over the app, but their offer was rejected on 13 September.
Any deal will need the approval of both Washington and Beijing.