Good morning. Sexual harassment, bullying and discrimination have long pervaded the Federal Deposit Insurance Corp., with perpetrators often receiving reassignments and even promotions, according to a blistering report on the agency’s culture that calls into question the leadership of Chairman Martin Gruenberg.

• Origin of the report: The report, crafted by law firm Cleary Gottlieb Steen & Hamilton and released Tuesday, was commissioned by the FDIC after a Wall Street Journal investigation in November revealed a toxic workplace culture at the agency.
   
• Who they spoke to: Investigators spoke to more than 500 employees at the bank regulator out of fewer than 6,000, most of them current, who “painfully and emotionally” recounted their experiences of misconduct at the agency, the report said.
   
• The accusations: The 234-page report includes examples of brazen misconduct. Executives who were known for pursuing and having relationships with subordinates were promoted or moved to other regions or divisions rather than facing discipline. One senior FDIC examiner sent a woman a picture of his private parts, while another was known for going to brothels with colleagues during work trips. A Hispanic employee was asked by a colleague to recite the Pledge of Allegiance to “prove that they were American.”
   
• Leadership issues: Investigators also confirmed that multiple employees, including senior leaders, have experienced “extremely difficult and volatile” interactions with Gruenberg, a Democrat who has spent nearly two decades at the FDIC. The report didn’t make a recommendation as to whether Gruenberg and other senior leaders should face discipline or removal, which was outside investigators’ scope. 

TikTok sues to block U.S. ban.

TikTok filed a federal lawsuit Tuesday challenging the constitutionality of a new law that requires a sale or ban of the popular social-media app, setting up a court showdown over national security and free speech in the age of global information wars.

TikTok's goal. The suit, filed directly with a federal appeals court in Washington, D.C., seeks a court order preventing the U.S. from enforcing the bipartisan law signed by President Biden last month. The measure bans TikTok in the U.S. unless its parent company, Beijing-based ByteDance, divests itself of the platform by mid-January.

• Congress advanced a bill Monday that requires the U.S. Postal Service to track crashes of trucks carrying mail, punish contractors that fail to report collisions and publish a yearly report on its highway safety record.
   
• A federal regulator wants Tesla to send more information regarding its Autopilot system tied to a December recall of more than two million vehicles, after crashes kept occurring after the recall.
   
• The Boy Scouts of America is renaming itself Scouting America after years of turmoil in an effort to be more welcoming after being dogged for years by hundreds of sexual-abuse lawsuits.
   
• Restaurant chain Panera Bread is discontinuing its line of caffeinated beverages called “Charged Sips” that are at the center of several lawsuits, according to a company spokesperson.
   
• Proposed legislation in New York could make the state the first in the nation to block gun makers from selling pistols if they don’t take measures to prevent them from being able to be converted to fire like machine guns.

OFAC modernizes its sanctions lists toolkit.

The Treasury Department’s Office of Foreign Assets Control on Monday announced the launch of a new public-facing website and data tool that it says will help smaller and less-resourced companies stay abreast of the latest changes to its sanctions lists.

The Sanctions List Service tool features a redesigned interface through which companies and other users can import customized sanctions list data. OFAC is also for the first time rolling out its own application program interface, or API, that will allow users to automate downloads of sanctions list data. See the new tool here.

–Dylan Tokar

Pricier insurance makes sense as climate risk grows, Chubb CEO says.

Surging insurance premiums in regions vulnerable to climate change make sense, and government efforts to hold back those increases won’t work in the long term, Chubb Chief Executive Evan Greenberg said.

Risk & Compliance Journal's Richard Vanderford reports from the RIMS Riskworld conference in San Diego, where Greenberg said Tuesday that U.S. states themselves are driving a crisis of insurance availability by blocking insurers from pricing climate change into policies.

“Climate change is sending price signals. Society will not adjust its behavior to the change of climate just because people talk about it,” Greenberg said. “We’re sending price signals very rationally. That starts driving behaviors.”

Ukraine says it foiled Russian plot to assassinate Zelensky.

The Ukrainian Security Service said it foiled a Russian plot to assassinate President Volodymyr Zelensky by striking his convoy with missiles and drones, calling it the latest attempt by Moscow to eliminate the Ukrainian leader.

The agency, known as the SBU, said it had detained two senior officers in the country’s Department of State Security, which is responsible for protecting the president. The SBU said they were two of five agents working on the plot under the direction of Russia’s Federal Security Service, the FSB. The agency said the group was also planning to kill SBU Chairman Lt. Gen. Vasyl Malyuk, and the country’s top military-intelligence officer, Lt. Gen. Kyrylo Budanov.

• Putin Builds on the Alliances He Needs to Prevail in Ukraine
• U.S. Soldier Detained in Russia

• The Biden administration’s intensive public and private campaign to forestall Israel’s assault on Rafah has become its toughest test to date with its Middle East ally.

• Stormy Daniels, testifying at Donald Trump's hush-money trial Tuesday, recounted the salacious details of a alleged tryst with the former president.
   
• Saudi Arabia’s plans for twin 100-mile-long skyscrapers have lost momentum amid spiraling costs and construction glitches.
   
• Tom Zhu, one of the three executives named on Tesla’s website, returns to China as carmaker seeks to launch Autopilot features there amid slowing sales.
   
• OpenAI on Tuesday is launching a new tool that can detect whether an image was created using the company’s text-to-image generator.

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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