The Morning Risk Report: Consumer Watchdog Moves to Drop Capital One Lawsuit By Richard Vanderford

Good morning. Trump administration officials are moving to drop a government watchdog's lawsuit that accused Capital One of misleading customers over the interest rates on their savings accounts.

Agency retreats: A notice of voluntary dismissal was filed in federal court in Virginia, where the Consumer Financial Protection Bureau brought its case in January. Mark Paoletta, chief legal officer for the CFPB, also moved to dismiss other enforcement actions.

Future in doubt: The future of the CFPB and its pending actions against banks have been in doubt since its acting director instituted a work freeze, laid off employees and closed the headquarters in Washington. President Trump's nominee to lead the CFPB, Jonathan McKernan, maintained Thursday that he would ensure the agency continues to enforce consumer financial-protection laws at a Senate Banking Committee hearing. Democrats questioned his statements in light of the legal dismissals.

'Regulatory vacuum': State attorneys general have previously complained that Trump administration plans to slash funding for the Consumer Financial Protection Bureau leave large federal banks without a functioning fraud watchdog-a major regulatory gap, in their view. Compliance

Monitor appointed in TD Bank $3 billion anti-money-laundering settlement.

Consulting firm Guidepost Solutions has been selected as the independent monitor to oversee TD Bank's remediation efforts after the Canadian bank pleaded guilty in October to charges that it failed to build proper anti-money-laundering systems.

The Justice Department and the Treasury Department's Financial Crimes Enforcement Network jointly picked Guidepost as the outside monitor, TD's U.S. head said during the bank's earnings call on Thursday, adding that it looks forward to working with them.

Microsoft urges Trump to overhaul curbs on AI chip exports.

Microsoft is pushing the Trump administration to loosen and simplify a new system that would restrict the sales of cutting-edge U.S. artificial-intelligence chips to much of the world.

Microsoft called for Trump's team to ease the limits on chips that can be used in data centers for training AI models so they no longer apply to a group of U.S.-friendly nations including India, Switzerland and Israel. Those countries are in the second tier of a three-tier system that underpins the export controls.

FBI officials from regional field offices gathered on a video call this week to hear from their new director, Kash Patel, who rattled off so many changes that employees couldn't tell if he was serious about all of them.

The Securities and Exchange Commission confirmed that it has dismissed a lawsuit against Coinbase that sought to regulate the company as a stock exchange, marking the official end of years of hardline enforcement against the crypto market.

Goldman Sachs is no longer spelling out its diversity hiring targets .

The Securities and Exchange Commission has agreed to drop a lawsuit against Consensys Software that sought to regulate the company as a broker, the company said. Risk

U.S. plans another 10% tariff on products from China.

The U.S. plans next week to impose an additional 10% tariff on imports from China over its role in the fentanyl trade and move forward with 25% tariffs on products from Canada and Mexico, President Trump said, setting up a pivotal week for his protectionist trade agenda.

The China move, slated to take effect Tuesday along with the Canada and Mexico actions, doubles up on the previous 10% additional tariff Trump placed on Chinese products this month.

Trump's Tariff Onslaught Is Coming Faster Than His Team Can Carry It Out Canada's Export Agency Sees Skyrocketing Interest in Trade Diversification as Tariffs Loom Trump's Tariff Comments Hit Canadian, Mexican Currencies

Trump sounds warmer tone on Ukraine but stops short of security guarantees.

President Trump struck a more supportive tone on Ukraine during his meetings with British Prime Minister Keir Starmer, but stopped short of promising the security guarantees for Kyiv that European allies want.

Starmer raised a plan to send European peacekeepers to Ukraine, seeking a U.S. military "backstop"of air defenses and intelligence support. Trump repeatedly said he would only consider those options after a cease-fire is reached between Moscow and Kyiv, an agreement he expects Russian President Vladimir Putin to honor.

Ukraine Rattled as U.S. Negotiator Points to Russia-Backed Template for Peace Canada's big banks are slowly building buffers against the risk of loan losses as clients grow increasingly wary of escalating trade tensions with the U.S.

Eurozone business leaders are feeling a little more confident about their prospects despite the threat of steep tariffs on European goods imported into the U.S.

France's inflation rate fell to its lowest level in four years , taking it further below the European Central Bank's target and priming the bank for a fresh cut to interest rates next week.

An imprisoned Kurdish militant leader urged his followers to give up their weapons, opening an opportunity to defuse a conflict that has killed tens of thousands of people in recent decades, and destabilized Turkey and the wider Middle East.

Three Austrian mainstream parties said they would form a government, elbowing aside the far-right group that had won the country's election in the latest sign of the political center pushing back against a right-wing surge in Europe. Executive Insights

Here is our weekly roundup of stories from across WSJ Pro that we think you'll find useful.

CFOs are weighing how much information to share about the impact of tariffs , especially as many are yet to take effect and the landscape continues to evolve.

The investment flow into the cannabis industry has slowed to a trickle , pressuring some private lenders that have become the primary source of its financing.

The adage about nuclear fusion is that it's always 10 years away. A startup in Germany that published plans for a commercial nuclear-fusion plant says it may be closer than that .

Venture capitalists typically prefer to invest in founding teams of two or more entrepreneurs who share duties, but a wave of startups with a solo founder is set to test those assumptions. What Else Matters Authorities in Thailand deported dozens of Uyghur men to China , despite vehement public objections and weeks of behind-the-scenes diplomacy from the U.S.

The administration, despite largely promoting arrests of criminals, has been detaining a number of migrants who don't have criminal backgrounds or orders for removal.

A fast-spreading mystery illness linked to bats has killed scores of people in the Democratic Republic of Congo, with nearly half dying within 48 hours of showing symptoms, the World Health Organization said.

U.S. Transportation Secretary Sean Duffy said the federal government would take steps to hire more air-traffic controllers and spend billions of dollars to upgrade the nation's aviation system.

KPMG has begun to set up a law firm in the U.S. after a court decision made it the first Big Four accounting firm eligible to practice law in the country. About Us

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This article is a text version of a Wall Street Journal newsletter published earlier today.

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February 28, 2025 07:08 ET (12:08 GMT)

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