Good morning. The suit by U.S. regulators against Binance Holdings Ltd. focuses in large part on the work of the cryptocurrency exchange’s former chief compliance officer, alleging he willfully aided and abetted the firm in evading U.S. laws.

Samuel Lim, Binance’s compliance chief between 2018 and 2022, faces civil charges of undermining Binance’s compliance program and conducting activities to evade rules designed to prevent illicit financial activity, the Commodity Futures Trading Commission said Monday.

• The CFTC's allegations: Mr. Lim and other officers promoted the use of creative means to help the exchange’s customers circumvent Binance’s compliance controls. He allegedly implemented a corporate policy that advised Binance’s U.S. customers to use virtual private networks, or VPNs, to avoid Binance’s internet protocol address-based controls or to create new offshore shell companies to avoid the exchange’s anti-money-laundering controls, according to a complaint filed by the CFTC Monday. 
   
• For example: The CFTC said in the complaint that Mr. Lim acknowledged in a chat in 2020 that some Binance customers, including ones from Russia, “are here for crime.” His money-laundering reporting officer agreed and said, “We see the bad, but we close 2 eyes.”
   
• What this means: The charges represent the CFTC’s increasing scrutiny in regulating the crypto industry, particularly in holding company executives accountable, said Rory Doyle, financial crime policy manager at regulatory technology provider Fenergo. The vast majority of fines levied by regulators were against institutions, according to an analysis of regulatory enforcement actions Fenergo conducted recently. But the personal liability risks for compliance officers and money-laundering reporting officers are rising, he said.

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White House to call for new midsize bank rules after SVB, Signature failures.

The White House is planning as soon as this week to recommend tougher rules for midsize banks, including for banks with $100 billion to $250 billion in assets, according to people familiar with the matter. 

The Federal Reserve is already rethinking a number of its rules related to those banks after Silicon Valley Bank and Signature Bank failed. Options include tougher capital and liquidity requirements, as well as steps to strengthen annual “stress tests” that assess banks’ ability to weather a hypothetical severe downturn. The White House declined to comment.

Also:

• Billions in Signature Bank Debt to Be Sold by Newmark Group
• Small Banks Are Losing to Big Banks. Customers Are About to Feel It.

Credit Suisse violated plea deal in tax case, Senate report says.

Credit Suisse Group violated the terms of a 2014 criminal plea agreement in which it promised to stop helping Americans hide assets from the U.S. tax authorities, according to a Senate report released Wednesday.

The Senate Finance Committee’s Democratic staff said Credit Suisse failed to report bank transfers tied to what it says may be an ongoing criminal tax conspiracy involving more than $100 million held by a family with dual citizenship in the U.S. and Latin America. The bank also, partly in response to the committee inquiry, recently identified more accounts that may be tied to Americans.

Meanwhile, UBS is replacing its chief executive officer for the same reason that investors are still wary of its deal with Credit Suisse: Execution risk looms large. The Swiss bank said Wednesday that former CEO Sergio Ermotti would succeed incumbent Ralph Hamers next week to complete the takeover of Credit Suisse and lead the subsequent integration.

• Massachusetts securities regulators said they are investigating a unit of Citizens Financial Group Inc. over its sales of a savings product offered by an insurer controlled by now-indicted financier Greg Lindberg.
   
• China is dispatching anticorruption enforcers abroad to chase down fugitives and recover stolen assets, a new extension of Beijing’s international reach aimed at strengthening Chinese leader Xi Jinping’s crackdown on graft.
   
• Longtime Starbucks Corp. leader Howard Schultz on Wednesday defended the coffee chain against accusations it has retaliated against pro-union workers who say they are seeking better pay and benefits.

China threatens retaliation if Kevin McCarthy meets Taiwan’s Tsai Ing-wen.

China said it would retaliate if House Speaker Kevin McCarthy meets with Taiwanese President Tsai Ing-wen during her planned stop in California next week, further stoking tensions around a highly scrutinized visit that is poised to test strained ties between Beijing and Washington.

Ms. Tsai is set to meet with Mr. McCarthy and other Republican members of Congress at the Ronald Reagan Library in Simi Valley on her way back from visits to Guatemala and Belize. It is the second of two planned stops in the U.S. bookending her trip to Central America.

Meanwhile. Ukrainian President Volodymyr Zelensky is urging Chinese leader Xi Jinping to meet with him as Beijing maneuvers itself as a potential peacemaker with strong ties to Moscow.

Also: 

• U.S. Pushes for Business Investment in Africa to Counter China’s Reach
• China Wants to Be at Center of New World Order, Top EU Official Says
• Saudi Arabia Strengthens Relations With China Amid Strained U.S. Ties

Israel-U.S. tensions rise over judicial overhaul. 

Israeli Prime Minister Benjamin Netanyahu’s plan to overhaul his country’s justice system has stirred tensions with the U.S., with President Biden and congressional Democrats criticizing the proposal and Israeli lawmakers firing back that the legislation is an internal matter.

Mr. Biden told reporters Tuesday that he was “very concerned” about a judicial overhaul in Israel that would grant the ruling coalition power to appoint more like-minded justices, allow the Israeli parliament to overrule the Supreme Court with a simple majority and sharply circumscribe judicial review.

• In the midst of perpetrating what federal prosecutors say was a massive corporate hacking campaign, Israeli private detective Aviram Azari in 2017 received welcome news. A group of hackers in India wrote him to say they had successfully infiltrated the email and social-media accounts of a group of environmental activists campaigning against Exxon Mobil Corp. 

• The Financial Accounting Standards Board voted to propose requiring U.S. public companies to further break down the operating expenses that appear on their income statement, for example by disclosing the amount of employee compensation, in a move to help investors better understand firms’ operations.
   
• Microsoft Corp. patched a dangerous security issue in Bing last month, days before it launched a new artificial intelligence-powered version of the search engine.
   
• Several tech executives and top artificial-intelligence researchers, including Tesla Inc. Chief Executive Officer Elon Musk and AI pioneer Yoshua Bengio, are calling for a pause in the breakneck development of powerful new AI tools.
   
• Russia’s main security agency said it had detained WSJ reporter Evan Gershkovich, a U.S. citizen, for what it described as espionage.