Good morning. U.S. prosecutors have filed criminal charges against KuCoin and two of its founders, accusing the global cryptocurrency exchange of violating U.S. anti-money-laundering laws.

• The charges: The indictment, unsealed Tuesday by prosecutors in Manhattan, charged KuCoin with violating the Bank Secrecy Act and operating an unlicensed money transmitting business, along with related conspiracy charges. Prosecutors also charged two of KuCoin’s founders, Chun Gan and Ke Tang, with related conspiracy charges.
   
• Charges by derivatives reguator: The U.S. Commodity and Futures Trading Commission, the derivatives market regulator, on Tuesday filed parallel civil charges against KuCoin for operating as an illegal digital asset derivatives exchange and for multiple violations of the Commodity Exchange Act.
   
• AML failures alleged: Prosecutors alleged KuCoin intentionally failed to have an adequate anti-money-laundering program to prevent the exchange from being used for terrorist financing and other illicit finance activities. The exchange also allegedly failed to maintain reasonable procedures to verify the identities of customers and to file suspicious activity reports, or SARs, as required.
   
• Not the first time: Tuesday’s charges are the latest regulatory problems for KuCoin. In December, the exchange agreed to pay $22 million and to stop doing business in New York to settle a lawsuit brought by the state’s attorney general’s office in March 2023 after admitting it operated as an unregistered exchange in the state.

More Chinese companies to be added to U.S. Import Ban List.

The Biden administration will enlarge a list of companies under an import ban because of their alleged ties to forced labor in China, an official said, a move that would intensify pressure on some corporate supply chains.

“We’re really focused on enhancing and expanding the entity list. We expect many more entities to be coming in the next few months,” Laura Murphy, a Department of Homeland Security policy adviser, said at a panel discussion for an audience of trade professionals in Philadelphia.

Former Mongolian prime minister’s luxury Manhattan apartments targeted by U.S.

The U.S. has moved to seize two luxury Manhattan apartments bought by Mongolia’s former prime minister using what prosecutors allege were shell companies and profits from corrupt mining contracts.

Former Mongolian Prime Minister Sukhbaatar Batbold bought the two apartments, which lie blocks from New York’s Central Park, in 2012 and 2015 for a total of $14 million, prosecutors said in a complaint unsealed in federal court in Brooklyn. To make the purchases, Batbold used money he skimmed from a $68 million mining contract, they said.

• Visa, Mastercard and the largest U.S. credit-card issuing banks have agreed to a settlement with merchants that have been suing them for nearly two decades over the fees they charge for swiping credit cards.
   
• The U.S. Securities and Exchange Commission said Andy Bechtolsheim, the co-founder of Sun Microsystems and Arista Networks, has agreed to pay almost $1 million to resolve claims that he engaged in insider trading.
   
• The Securities and Exchange Commission is asking a New York judge to impose a nearly $2 billion fine against crypto firm Ripple Labs for violating investor-protection laws, according to court documents made public Tuesday.
   
• China filed a complaint at the World Trade Organization over the U.S.’s Inflation Reduction Act, saying it was discriminatory and distorted fair competition.
   
• Florida Gov. Ron DeSantis signed legislation Monday that prohibits people under 14 years of age from having social-media accounts, regardless of parental consent.

Financial Action Task Force upgrades U.S. anti-money-laundering rating.

The Financial Action Task Force has revised a prior noncompliant rating the global financial watchdog gave the U.S. on its anti-money laundering safeguards, thanks to a new beneficial ownership rule the Treasury Department is implementing.

FATF on Tuesday said the U.S. is now “largely compliant” with a recommendation by the group that member countries create rules preventing criminals from using shell companies to hide dirty money. The new rating comes as the Treasury works to implement the Corporate Transparency Act, a bill approved in 2021 that requires companies to submit ownership information to the department.

—Dylan Tokar

Bridge collapse sends exporters, retailers moving to contain business fallout.

The collapse of a major bridge along a crucial trade corridor outside Baltimore idled shipping at one of the East Coast’s busiest ports, tied up coal shipments and pushed retailers, truckers and industrial firms to reroute shipping volumes to contain the economic fallout of the catastrophic event.

The damage. Vessel traffic at the Port of Baltimore was completely shut down immediately after a containership hit the Francis Scott Key bridge just south of port early Tuesday. Maryland Gov. Wes Moore said there was no estimate of when the fifth-busiest container port on the U.S. East Coast would reopen.

• How a Night Shift on Baltimore Bridge Turned Deadly
• Sizing Up the Economic Impact of the Baltimore Bridge Collapse

Boeing’s next CEO will have ‘massive job’ at company in crisis.

Federal probes, sloppy factories, angry airlines, tense union negotiations and supply-chain snarls. Boeing’s crisis won’t end when David Calhoun exits as chief executive.

What they will face. The next leader of the American manufacturing icon will have to address some of the same issues that Calhoun, a longtime Boeing director, was brought on to clean up four years ago when the board he led ousted his predecessor.

• By throwing down a legislative challenge that could shut down TikTok in the U.S., Congressman Mike Gallagher demonstrated this month why companies trembled when he took aim at their China links.
   
• U.S. office markets are suffering from soaring vacancy rates, a record amount of available sublease space, and rising defaults. But curiously, office rents are holding steady or even climbing.
   
• China’s premier and its central bank chief have sought to calm the country’s embattled property sector in recent days, but investors are waiting on something slightly more elusive: concrete steps.
   
• Australia’s prudential regulator will conduct its first systemwide stress test, as it seeks to better understand potential risks borne by an increasingly interconnected financial system.
   
• Cybersecurity leaders struggle to communicate​ with executives and boards of directors and often paint an overly positive image of their companies’ security, according to a new survey of C-suite executives.
   
• BlackRock's Larry Fink sees a global retirement crisis brewing.

• NBC News cut ties with Ronna McDaniel mere days after it hired the former Republican National Committee chairwoman as a contributor.
   
• The Supreme Court appeared likely to preserve access to the abortion pill mifepristone, following arguments Tuesday in which justices suggested that protecting doctors who oppose abortion wasn’t enough justification to roll back access to the drug.
   
• Shares of Donald Trump’s social-media company surged 16% on their first day of trading, boosting the presidential candidate’s fortune. The question is, how soon can he tap his roughly $4.5 billion stake in Truth Social.
   
• Latin American immigrants are starting businesses at more than twice the rate of the U.S. population as a whole.
   
• A Russian court extended the detention of Evan Gershkovich by three months, almost a year to the day since The Wall Street Journal reporter became the first U.S. journalist to be detained there on an allegation of espionage since the end of the Cold War.

Follow us on X at @WSJRisk. Follow Risk & Compliance editor David Smagalla @DSmagalla_DJ and reporters Mengqi Sun @_MengqiSun, Dylan Tokar @dgtokar and Richard Vanderford @VanderfordRich.

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