Good morning. New U.S. guidance clarifying when banks should flag suspicious transactions should help banks allot compliance resources to the most pressing tasks, according to U.S. financial regulators, Risk Journal’s Max Fillion reports. 

• Response to industry concerns: The guidance was a response to “pain points” industry representatives repeatedly brought up to the government, representatives from the Federal Reserve and the Federal Deposit Insurance Corp. told the audience at a financial crimes conference in Arlington, Va. 
   
• The background: The guidance issued last week responded to frequently asked questions from industry about U.S. anti-money laundering regulations. It in part said anti-money laundering professionals don’t need to flag transactions simply because they are near a $10,000 reporting threshold.
   
• What has changed: Previous guidance on filing so-called suspicious activity reports, or SARs, was never intended to tell banks they needed to flag transactions simply because they noticed a series of transactions from the same customer at or near the $10,000 threshold, Federal Reserve anti-money laundering official Koko Ives said. She added that she has always told bankers that they only need to file when they suspect the transactions were designed to avoid reporting requirements by coming in under the $10,000 threshold. Regulators in their guidance said those seeking to evade reporting requirements often will break a lump sum exceeding $10,000 into a series of smaller transfers below the threshold, for example.

Bank of America, BNY sued over Jeffrey Epstein ties.

New lawsuits against Bank of America and Bank of New York Mellon over their ties to Jeffrey Epstein accuse the banks of maintaining relationships with the convicted sex offender and failing to report suspicious activities until after his 2019 death.

The two class-action lawsuits were filed in federal court on Wednesday on behalf of a Jane Doe and other women who have accused Epstein of abuse. They allege that Epstein’s trafficking operation wouldn’t have existed without the banks that provided special treatment to Epstein and his co-conspirators. The suits seek unspecified financial damages. Spokesmen for Bank of America and BNY had no immediate comment.

• The sudden collapse of auto-parts giant First Brands Group has left Wall Street firms sorting through the wreckage. Few are facing more questions than Jefferies Financial Group, a supporting player in the finance world that now finds itself in the harsh spotlight of an accounting scandal.
   
• Canada’s Industry Minister Melanie Joly threatened Stellantis with legal action over the car company’s plan to make midsize Jeeps in Illinois instead of Ontario.
   
• Potential changes to the way businesses measure the emissions they generate from buying electricity could upend the market for green power, according to U.S. business coalitions.
   
• A Moscow court has ordered central securities depository Euroclear Bank to pay damages to Russian state-owned DOM RF Bank for blocking the bank’s securities after the European Union imposed sanctions on Russia’s banking sector, Risk Journal reports. 
   
• European Commission President Ursula von der Leyen called on Serbia Wednesday to increase alignment with EU foreign policy including sanctions against Russia, saying greater effort is needed despite Serbia reaching 61% alignment, Risk Journal reports.

The nation’s biggest banks are saying the economy is still strong.

The nation’s biggest bankers proclaimed this week that the economy is sturdy, the U.S. consumer is healthy, and they haven’t seen much change in recent months. Yet they still sounded uneasy about what is around the corner.

Banks including JPMorgan, Bank of America and Goldman Sachs reported third-quarter profit and revenue that beat analysts’ expectations, buoyed by a jump in dealmaking, corporate spending and healthy consumer activity. Growing confidence from business executives, low delinquencies on consumer debts and a rallying stock market have all helped generate profit across the banks.

Israel and Hamas start next phase of talks on Trump plan.

Israel and Hamas began negotiating the second phase of a plan outlined by President Trump to end the war in Gaza, as debates continued about the militant group’s failure to return all the bodies of dead hostages as required in the first phase.

Hamas handed over the bodies of two more hostages to Israel on Wednesday, a day after both sides accused each other of violating the cease-fire that was part of the deal that released all 20 living detainees from Gaza.

• Netanyahu Says He Has Won the War. Can He Win the Peace?

• Agricultural stocks are rising Wednesday, a day after President Trump’s Truth Social post threatening to ban exports from China of used cooking oil – a key ingredient needed to produce renewable fuels.
   
• A federal judge temporarily blocked the Trump administration from moving ahead with mass firings of federal employees while the government is shut down.

• The Trump administration is assembling a $20 billion private finance facility that could act as a backstop for Argentina’s debt, Treasury Secretary Scott Bessent said Wednesday, expanding a lifeline for the beleaguered South American nation.
   
• The public-health resistance to Health and Human Services Secretary Robert F. Kennedy Jr. is growing. Governors across 15 states including New York, California and North Carolina are forming a new public-health alliance to detect and respond to disease threats, saying federal-funding cuts and policy changes by the Trump administration are putting their citizens at risk and forcing them to find alternatives.
   
• An Nvidia-backed AI startup is planning to build a massive data-center complex with CoreWeave that is capable of generating its own power on a site that is two-thirds the size of Central Park.

Follow us on X at @WSJRisk. Send tips to our reporters Max Fillion at max.fillion@dowjones.com, Mengqi Sun at mengqi.sun@wsj.com and Richard Vanderford at richard.vanderford@wsj.com.

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