Good morning. The Securities and Exchange Commission is asking investment advisers how they use and oversee artificial intelligence, reports Risk & Compliance Journal's Richard Vanderford, as agency head Gary Gensler continues to express skepticism about the technology.

• What are they looking for? The SEC’s examinations division has sent requests for information on AI-related topics to several investment advisers, part of a process known as a sweep. The agency wants details on topics including AI-related marketing documents, algorithmic models used to manage client portfolios, third-party providers and compliance training, according to one such letter obtained by Vigilant Compliance, a regulatory compliance consulting firm.
   
• Industry reaction: Karen Barr, the head of the Investment Advisers Association, confirmed that her trade group has heard about the SEC outreach to advisers on the use and governance of AI. The agency’s exercise could be “extremely helpful as the commission considers policy issues relating to these emerging technologies,” she said.
   
• AI in the regulatory spotlight: The SEC continues to pursue an ambitious rule-making agenda that includes a focus on regulated firms’ use of AI. The agency in July proposed rules around the use of data analytics, including AI, which would require firms to neutralize any conflicts in which AI put the firm’s interests above a client’s. Other proposed rules also touch on AI.

Nasdaq settles alleged Iran sanctions violation for $4 million.

Stock exchange operator Nasdaq has agreed to pay $4 million in a settlement with the U.S. Treasury Department over alleged Iran sanctions violations.

The charges: A former Armenian subsidiary of Nasdaq allegedly processed trades and settled payments involving a sanctioned Iran-owned bank, the Treasury Department’s Office of Foreign Assets Control said Friday. The transactions occurred on platforms the subsidiary provided to facilitate overnight loans and foreign exchange trading among Armenia’s banks.

Response: Nasdaq said it is pleased to have resolved the matter, adding it “maintains a robust compliance program and is committed to adhering to the highest levels of ethics and integrity.”

Sweeping regulation of AI advances in European Union deal.

European lawmakers reached a political deal on regulating artificial intelligence, marking a step toward establishing a comprehensive AI law in Western countries.

AI under pressure. The European Union’s Artificial Intelligence Act would be the latest in a series of regulations the bloc has pushed forward that is expected to reverberate through the global tech industry and affect some of its biggest players. Earlier legislation from the EU set out new competition and online content rules that affect large U.S. tech companies including Meta Platforms, Apple and Google’s parent, Alphabet.

U.S. adds China companies to forced labor ‘entity list,’ sanctions Xinjiang officials.

Three China-based companies have been added to a U.S. watchlist known as the “entity list” because of alleged links to forced labor in China’s Xinjiang region, the home to the Uyghur people and other minority groups. The Department of Homeland Security announced the action, which restricts the U.S. import of the companies’ goods under the Uyghur Forced Labor Prevention Act, on Friday.

The three companies are Cofco Sugar Holding, a sugar refiner; Sichuan Jingweida Technology Group, a magnetic device maker; and Anhui Xinya New Materials, a textile manufacturer. Cofco and Sichuan Jingweida didn’t respond to requests for comment. Anhui Xinya couldn’t be reached.

Separately Friday, the U.S. Treasury Department announced sanctions on two Chinese government officials for alleged connection to human rights abuses in Xinjiang. The two men served as high-level officials in the region.

—Richard Vanderford

• The Federal Trade Commission is investigating Chevron’s $53 billion proposed deal to buy Hess, the second-biggest oil megamerger this year.
   
• U.K. regulators said they are examining Microsoft’s  partnership with OpenAI.
   
• A giant Russian cargo plane is facing another cold Canadian winter stuck in Toronto. A court battle could determine its fate.
   
• A California judge on Friday granted class certification to an ongoing pay-equity lawsuit against Disney, setting the stage for a jury trial next year over claims that it paid women less than their male counterparts.
   
• A moving company shows off the clean-cut, chiseled student athletes who pump iron before loading your furniture. The federal government says that’s a problem.
   
• Fossil-fuel producers are fighting an existential battle in Dubai in the final stretch of the United Nations climate conference against countries that want to end the burning of coal, oil and natural gas.
   
• The Biden administration’s efforts to renew legislation that allows the U.S. to track the electronic communications of terrorists, spies and hackers overseas is facing an uphill battle.
   
• Donald Trump changed course on Sunday and said he wouldn’t testify again in his civil-fraud trial.

Economy’s soft landing comes into view as job growth slowly descends.

A gradual cooling of the still-solid labor market extended into November, renewing optimism the economy is still on a glide path for a soft landing.

Employers added a seasonally adjusted 199,000 jobs last month, the Labor Department reported Friday, slower than earlier in the year but consistent with gains before the pandemic. Most recent hiring occurred in two big sectors: healthcare and the government.

• Jerome Powell’s Inflation Fight Is Succeeding, Raising Questions About Rate Cuts

The megafactories are coming. Now the hustle is on to find workers.

Enormous factories are sprouting outside of Columbus, Ohio. Now comes the hard part—finding people to work in them.

Manufacturing jobs are tough to fill around the Ohio state capital, which has one of state’s lowest unemployment rates and a flourishing logistics industry that competes for the same employees. The region’s plants have thousands of open positions, a shortage that is causing some managers to join their workers on the production line.

• Consumer prices in China fell for the second straight month, a deepening bout of deflation that shows Beijing’s efforts to reignite faltering growth are falling short.
• A new breed of insurer is finding opportunity as larger companies exit some markets.
• X wants Facebook’s secret weapon: small businesses.

• An investor group has made a $5.8 billion offer to buy Macy’s, in a bid to take the famed department-store chain private.
   
• Cigna Group abandoned its pursuit of a tie-up with Humana after shareholders balked at a deal that would have created a roughly $140 billion giant in the health-insurance industry.
   
• As supply-chain constraints ease and availability improves, the costs of electronics, appliances, flights and cars decline, while food prices continue to rise.
   
• The founder of fast-fashion juggernaut Shein has managed to stay out of the spotlight despite his company’s meteoric rise. With an IPO looming, he likely won’t remain under the radar for much longer.
   
• Most consumers want brands to support inclusion. But when they do, they face a potentially negative backlash. Just ask Bud Light.

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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