Good morning. U.S. lawmakers said the Biden administration should crack down on China’s use of forced labor in seafood production, reports Risk & Compliance Journal's Richard Vanderford, after an investigative journalism group found widespread transfers of laborers from the country’s Xinjiang region to processing facilities elsewhere in the country.

• What the lawmakers recommend: The administration should block imports from seafood-processing facilities in China that run afoul of a U.S. law meant to target forced labor linked to Xinjiang, home to the country’s Uyghur people and other minority groups, said Rep. Chris Smith (R., N.J) and Sen. Jeff Merkley (D., Ore.) in a letter sent Tuesday to Department of Homeland Security Secretary Alejandro Mayorkas. The two men head up the Congressional-Executive Commission on China, a government body that monitors China’s human rights record. 
   
• Why is it important? China is the world’s largest seafood producer, with production estimated at 67.5 million metric tons in 2022, according to a report from the U.S. Agriculture Department. Smith and Merkley cited investigations by The Outlaw Ocean Project, a nonprofit journalism organization, that reported allegations of widespread transfer of forced laborers from Xinjiang to seafood-processing facilities in other parts of China.
   
• Context: The pressure for action targeting the sector comes amid an unprecedented focus on businesses’ supply chain links to China, particularly as the U.S. enforces a law that went into effect last year that largely blocks the import of goods from Xinjiang.

States sue Meta alleging harm to young people on Instagram, Facebook.

A coalition of 41 states and the District of Columbia are filing lawsuits alleging that Meta Platforms has intentionally built its products with addictive features that harm young users of its Facebook and Instagram services.

What do the suits say? The lawsuits, in federal and state courts, say Meta misled the public about the dangers of its platforms for young people. The states also allege that Meta knowingly has marketed its products to users under the age of 13, who are barred from the platform by both Meta’s policies and federal law. The states are seeking to force Meta to change product features that they say pose dangers to young users.

SEC enforcement director doubles down on ‘proactive compliance.’

Companies need to create “a culture of proactive compliance,” Gurbir Grewal, the U.S. Securities and Exchange Commission’s enforcement division chief, said at a compliance industry event.

Doing so will require compliance professionals to learn the relevant regulations for their businesses, engage with personnel across business units and self-report possible misconduct to the SEC, Grewal said Tuesday at the New York City Bar Association’s Compliance Institute.

Grewal also described three scenarios in which the SEC would recommend charges against compliance officers: when they participated in misconduct unrelated to the compliance function; when they misled regulators; and when there was a wholesale failure to carry out their compliance responsibilities.

“But cases like these are rare,” Grewal said, adding that only a handful of cases filed by the SEC since he became enforcement chief involved charges against compliance officers.

–Mengqi Sun

• Top U.S. banking regulators struggled for more than five years to update anti-redlining rules aimed at making banks lend more in lower-income communities. On Tuesday, they completed a revamp of them for the era of online banking.
   
• The California Department of Motor Vehicles suspended Cruise’s autonomous-driving permit Tuesday, effectively halting its robot-taxi service in San Francisco.
   
• Lawyer Jenna Ellis became the third legal adviser to plead guilty in the Georgia racketeering case involving Donald Trump’s attempt to overturn the 2020 election, marking a blow to the former president’s defense and raising pressure on other loyalists to cut deals with the district attorney.
   
• Hong Kong will cut taxes on home purchases and stock trades, part of efforts to revive its credentials as a financial hub and boost a struggling property market.

How far is China’s slowdown spreading? Ask a dairy farmer 6,000 miles away.

As the sunrise cast a pink glow around 6:30 a.m., Michael and Susie Woodward worked together to attach suction cups to the udders of dozens of cows in the milking shed of their New Zealand dairy farm.

When a tanker arrived to take the milk to a processor, Michael Woodward calculated the day’s earnings—and figured he and his wife would lose about $25 on the shipment.

Their troubles show the global impact of a slowdown in the world’s second-largest economy this year. China has been struggling to revive growth after an initial bounce from its Covid-19 reopening fizzled, as consumers who initially spent on traveling and dining out curtailed spending.

The value of China’s imports, including consumer products, fell 6.2% in September compared with the same month last year. Everything from cosmetics to cars to dairy has taken a hit.

• China Increases Bond Issuance to Help Its Economy

Apple risks getting caught in Taiwan tensions with iPhone supplier probes.

For decades, Apple has navigated an escalating series of challenges in China, from fake stores and factory protests to tightening censorship and app rules. Now, the iPhone maker risks getting dragged into the most volatile issue in U.S.-China relations: the future of Taiwan.

On Sunday, Taiwanese contract manufacturer Foxconn Technology—one of Apple’s largest suppliers—said it is cooperating with Chinese authorities after state media reported China had opened tax and land-use probes into the company. The investigations come as Foxconn’s billionaire founder Terry Gou pursues a bid for the Taiwan presidency.

The probes, announced days after Apple Chief Executive Tim Cook was in China, open the possibility of a new category of geopolitical risk for Apple in the country.

• Iran in recent days has unleashed the regional militias it has spent years arming, raising the risks of larger conflict in the region.
   
• The United Auto Workers expanded its strike against Detroit’s automakers with a walkout at one of General Motors’ largest and most profitable factories.
   
• General Motors is abandoning a self-imposed target to build 400,000 electric vehicles by mid-2024, the latest sign that automakers are concerned about the viability of the market for battery-powered cars.
   
• The banks that financed Elon Musk’s $44 billion purchase of Twitter are still struggling a year later to contain the damage to their balance sheets.
   
• For four decades, patient savers able to grit their teeth through bubbles, crashes and geopolitical upheaval won the money game. But the formula of building a nest egg by rebalancing a standard mix of stocks and bonds isn’t going to work nearly as well as it has.
   
• Hurricane Otis made landfall on Mexico’s Pacific Coast as a powerful Category 5 storm, as authorities warned of torrential rain, landslides and flash flooding.
   
• A dispute between China and the Philippines, a U.S. ally, is rapidly escalating over an unusual military outpost: a World War-II era ship that is leaky, riddled with holes, covered in rust and sitting atop a reef in the South China Sea.

• House Majority Whip Tom Emmer (R., Minn.) dropped his bid to serve as House speaker just hours after he was narrowly elected as the Republican nominee.
   
• With the Middle East on the precipice of perhaps its worst conflict since the U.S. invasion of Iraq in 2003, the fighting in Gaza and Israel loomed over, but hardly disrupted, a Saudi-sponsored investment forum that included some of the titans of Wall Street.
   
• If you want to know why apartment rents got so high, some people say look to big data. Many landlords outsourced their pricing decisions to software that told them what rents to charge.
   
• Finland said that a Chinese ship’s anchor had likely caused a mysterious rupture of an undersea gas pipeline in the Baltic Sea earlier this month that raised concerns about the vulnerability of European infrastructure to sabotage.
   
• Federal authorities suggested psychedelic mushrooms and depression may have played a role in an off-duty Alaska Airlines pilot’s alleged attempt to shut down an airplane’s engines midflight.

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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