Good morning. A new federal rule now requires more than 32 million small businesses nationwide to file ownership information to a little known agency in the U.S. Treasury Department or face potential penalties. The problem: Many of these businesses don’t know about it.

The Financial Crimes Enforcement Network, the anti-money-laundering bureau of the Treasury Department, says it has been working hard to inform those affected by the new law, spreading the word through social media and asking other government agencies to help. But small-business advocates say more needs to be done.

• The background: The new filing requirements are mandated by the Corporate Transparency Act, a piece of sweeping bipartisan legislation passed in 2021 that Congress hopes will curtail the use of anonymous shell companies and track the flow of illicit money. The new law became effective on Jan. 1. The law creates a beneficial ownership database and reporting requirements for companies to file ownership information to FinCEN, similar to existing requirements in the U.K. and the European Union.
   
• The reality: In a National Small Business Association survey of its membership published in November, about 47% of respondents said they had no idea what the Corporate Transparency Act was, while another 25% said they had heard of the law but didn’t know whether they needed to report. Only about 16% said they were aware and did have to report and 12% said they were aware but weren’t required to report.
   
• Penalties for noncompliance: Not filing ownership information to FinCEN can carry significant criminal and civil penalties, including for companies’ senior executives, according to the agency. Willful failure to comply can also lead to fines of up to $591 a day for each violation.

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U.S. to tackle secrecy in all-cash home purchases.

The Biden administration is looking to further crack down on money laundering in the U.S. residential real-estate market.

The Treasury Department on Wednesday proposed a new rule that would require real-estate professionals involved in closings and settlements to disclose the names of people behind the anonymous limited liability companies and trusts involved in all-cash residential property sales and transfers nationwide, regardless of purchase price.

The case against Bill Ackman and Elon Musk’s anti-DEI stance.

Minority, veteran and women-focused business advocacy groups are urging companies to invest in diversity initiatives that are under legal attack and face fierce opposition from Bill Ackman and Elon Musk.

The group, which includes the U.S. Black Chambers, National Urban League, National LGBT Chamber of Commerce and National Veteran-Owned Business Association, said investments in diversity initiatives were essential to business success and the U.S. economy.

• China has removed its top securities regulator, following a yearslong stock-market decline that has become an increasingly sensitive subject for Beijing officials in recent days.
   
• Officials in New York are pushing to restrict the algorithms that power a platform’s feed, making it the latest state to attempt to rein in the big tech companies in the wake of federal inaction.

Sports gambling a growing money laundering risk, U.S. says.

Online sports gambling poses an increasing risk of money laundering, the U.S. Treasury Department said in a warning that comes as a record number of Americans are expected to place bets on the coming Super Bowl.

The rapid growth of the sports betting sector and a lack of uniform regulations contribute to “significant and increasing money-laundering risks,” the Treasury said Wednesday as part of an expansive report on money-laundering concerns.

• Germany’s industrial production declined more than expected in December, posting a seventh-straight month of falling output and reflecting further weakness in the key manufacturing sector of Europe’s largest economy.
   
• Russian intelligence agencies are trying to undermine U.S. influence in Africa by spreading disinformation that Africans have been the unwitting test subjects in Pentagon biological research programs.
   
• With manpower and equipment severely depleted by last year’s failed counteroffensive, Ukraine finds itself fighting a defensive effort aimed at delaying Russian advances and preventing a breakthrough.
   
• Israeli Prime Minister Benjamin Netanyahu rejected Hamas’s terms for a cease-fire in Gaza, after the Palestinian militant group called for the release of thousands of prisoners along with other concessions in its first response to an American-backed truce proposal to end the fighting.
   
• A U.S. drone strike in Baghdad killed a commander of the Iran-backed Iraqi militia blamed for a deadly strike at a U.S. base in Jordan last week, part of a sharpened effort by the Pentagon to deter attacks on its forces.

• Many Americans are downbeat on the economy, despite data showing it is actually robust. Many feel their long-term financial security is vulnerable to wide-ranging social and political threats.
   
• Senate Democrats tried to pin down more GOP support for a bill that would provide military aid to Ukraine, Israel and other allies, after Republicans blocked a broader legislative package that linked the foreign assistance to policy changes at the southern border.
   
• The federal deficit is on track to shrink this year. But the U.S. government still faces profound fiscal challenges in the coming years.

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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