Good morning. Nearly half of U.S. employees are using artificial intelligence tools inappropriately or without permission, reports Risk Journal’s Richard Vanderford, and more than a third say AI is increasing compliance risks at work.

A large share of U.S. workers admitted to questionable AI practices, a survey report released Monday by accounting firm KPMG said. 

• Misuse of AI: The survey found 44% of workers admitted to potentially unauthorized or inappropriate uses of AI, and 46% copped to uploading sensitive company information and intellectual property to public AI tools.
   
• Complicated views: In addition, 58% of workers admitted to relying on AI to finish work and then failed to properly evaluate outcomes, while 53% said they presented AI-generated work as their own. Still, 70% said they are eager to realize AI’s benefits.
   
• Questions raised: “Half of U.S. workers are using AI tools without clear authorization, and many have admitted to using AI inappropriately,” said Samantha Gloede, a trusted enterprise leader at KPMG. “This highlights a significant gap in governance and raises serious concerns about transparency, ethical behavior and the accuracy of AI-generated content.”

Trump has a trust problem in court.

With increasing irritation, federal judges are questioning the Trump administration’s veracity in legal proceedings.

The consequences could be serious—both for the administration, which might see its odds of prevailing on close questions diminish before judges who lack confidence in government representations, and for the judiciary, should lip service to court orders become an acceptable norm.

The latest potential standoff could come this week, when U.S. District Judge Amy Berman Jackson is scheduled to hold a hearing on whether White House officials are flouting her orders to cease dismantling the Consumer Financial Protection Bureau, an action she found violated the Dodd-Frank law that established the agency.

• Wells Fargo said Monday that the Consumer Financial Protection Bureau lifted a consent order that the bank had been operating under for seven years, according to Barron’s, a sign that what had been the nation’s most troubled big lender is fixing long-running compliance weaknesses.
   
• Carbon-removal credits are one of the few ways companies can decarbonize, but so far demand has remained limited to just a handful of buyers.
   
• Washington, D.C.-based trade group National Venture Capital Association juiced its lobbying capabilities in March, naming Capitol Hill veteran Diem-Mi Lu as vice president of government affairs.

Goldman Sachs is advising countries scrambling to please Trump on tariffs.

Countries big and small are turning to Wall Street banks for guidance on how to navigate Trump’s global trade war. Bankers have advised that negotiations with the Trump administration could be affected by issues that have nothing to do with trade and might require political or symbolic concessions to the White House.

South Africa, France and Saudi Arabia are among the governments that have spoken with Goldman on negotiating with the Trump administration, people familiar with the matter said.

• America Inc. Slashes Spending as Tariff Uncertainty Swirls
• Why Making an All-American Product Is So Hard
• Trump to Soften Blow of Automotive Tariffs

The Russian military moves that have Europe on edge.

With President Trump and many other world leaders preoccupied with the war in Ukraine, some Europeans are growing alarmed about what the Russian army has been doing much more quietly along other stretches of its border with Europe.

Some 100 miles east of its border with Finland, in the Russian city of Petrozavodsk, military engineers are expanding army bases where the Kremlin plans to create a new army headquarters to oversee tens of thousands of troops over the next several years.

• Moscow Digs In Over U.S. Peace Terms as Putin Declares Short Cease-Fire in May
• Moscow, Pyongyang Acknowledge Presence of North Korean Troops in Ukraine Conflict for First Time
• Russia Hopes Warmer Weather Will Boost Flagging Spring Offensive

• China and the Philippines have staked rival claims to a spit of land in the South China Sea, moves that could further inflame tensions in one of the world’s busiest shipping lanes.
   
• Power began to return to parts of Spain and Portugal as nightfall approached Monday after a major electrical outage caused widespread disruption to the Iberian Peninsula.
   
• Humanitarian supplies are running out in Gaza after almost two months of an Israeli blockade, spurring debate among officials here over how to turn the spigot back on while maintaining pressure on Hamas.
   
• Yemen’s Houthi rebels alleged an American airstrike killed at least 68 people and injured scores more in a detention center holding African migrants in northern Yemen on Monday, one of the deadliest attacks in the six-week-long U.S. bombing campaign.
   
• The chief executive of Lynas Rare Earths says now is the time to reset the rare-earths market, as a trade war derails a China-dominated supply chain for the critical minerals. But Amanda Lacaze won’t bet Lynas’s own balance sheet on a Texas project intended to revitalize America’s domestic supply, she cautions, as the costs to build the project rise.
   
• Business sentiment in the euro area suffered this month as new tariffs darkened the economic outlook, according to a monthly survey published Tuesday.
   
• German consumer confidence surprisingly ticked up despite warnings of the economic hit from U.S. trade policy, as consumers pinned their hopes on the stability of a new incoming government.

Deep-pocketed investors make startups a target for hackers.

Getting a startup on its feet after a cyberattack can cost a fortune. More often than not, investors get stuck with the bill.

Most early-stage ventures simply don’t have the cash to cover damage control after a hack. That can include hefty costs for forensic investigations, customer alerts, regulatory compliance and legal fees that together can run into the hundreds of thousands of dollars, or more.

• President Trump plans to sign an executive order on Monday escalating his battle against Democratic-led states and cities that don’t fully cooperate with federal immigration authorities.
   
• Canada’s Liberal Party won a fourth term in office but appeared short of a majority in Parliament, which could force Prime Minister Mark Carney to seek help from rival politicians to push through an economic agenda designed to contain fallout from President Trump’s trade war.
   
• After a 100-day sprint through domestic priorities, President Trump’s focus is shifting abroad, driven by a mountain of trade negotiations with other countries, including China, and unfulfilled promises of attaining peace in Ukraine.
   
• International Business Machines plans to invest $150 billion in the U.S. over the next five years as tariffs threaten to make international manufacturing more expensive.
   
• The head of Israel’s domestic intelligence agency, one of the most senior officials blamed for Israel’s failure to prevent the Oct. 7, 2023 Hamas-led attack, said he would resign on Monday after a prolonged public battle with Prime Minister Benjamin Netanyahu.

Follow us on X at @WSJRisk. Send tips to our reporters Mengqi Sun at mengqi.sun@wsj.com and Richard Vanderford at richard.vanderford@wsj.com.

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