Good morning. Michelle Bowman, the Federal Reserve's vice chair for supervision, has slashed staff and pursued what many inside and outside the central bank view as a housecleaning of the supervision and regulation division’s senior leadership.

Ultimately, she says she wants to make the exam process more transparent and fair for banks. In public speeches, Bowman has criticized the Fed’s examiners for focusing too much on “procedural and documentation shortcomings” and not enough on a bank’s core financial risks. She says reforms will make the process more efficient and lead to improved risk-spotting.

• Interest-rate pressure: Bowman’s attempts to remake the division are happening as Trump piles pressure on the Fed and Powell to lower interest rates. Federal prosecutors have launched a criminal investigation into testimony by Powell over a building-renovation project, raising fresh questions about the central bank’s independence. And Trump is expected to name a nominee to replace Powell soon.
  Bowman’s plans to cut jobs and remake rules for examiners are adding to the tension and dramatic remaking of the central bank.

• Toning down supervision? Internally, some examiners have interpreted her policies to mean they should refrain from being tough on the banks they oversee, people familiar with the division said. In recent months, some examiners were sidelined or taken off the job by their supervisors after banks lodged complaints with Bowman, several people said.
   
• Growing concerns: Some former Fed officials, Democratic lawmakers and banking watchdogs have expressed concerns about a hollowing out of the regulator and whether the Fed will be in position to identify emerging risks before they become systemic.

Justice Department opens criminal probe into Silicon Valley spy allegations.

The Justice Department has opened a criminal investigation into allegations that Deel, a human-resources company, recruited a spy inside a rival firm, according to documents viewed by The Wall Street Journal, and people familiar with the matter.

Grand-jury subpoenas were sent out in recent weeks by Craig Missakian, the U.S. attorney for the Northern District of California, the documents show. They seek information related to a spying operation that Deel allegedly ran inside a rival company, Rippling.

Justice Department opens criminal probe into Silicon Valley spy allegations.

The Justice Department has opened a criminal investigation into allegations that Deel, a human-resources company, recruited a spy inside a rival firm, according to documents viewed by The Wall Street Journal, and people familiar with the matter.

Grand-jury subpoenas were sent out in recent weeks by Craig Missakian, the U.S. attorney for the Northern District of California, the documents show. They seek information related to a spying operation that Deel allegedly ran inside a rival company, Rippling.

• Congressional Democrats are calling on federal watchdogs to investigate what they describe as a massive diversion of resources away from white-collar crime enforcement to support President Trump’s immigration enforcement agenda, Risk Journal reports.
   
• A top U.S. banking regulator has said it won’t delay its review of World Liberty Financial’s proposal to start a new trust bank despite concerns among lawmakers about potential conflict of interest over WLF’s connections to President Trump.
   
• The European Union launched a new investigation into Elon Musk’s X social network following a public outcry over sexualized deepfake images created by its Grok AI service.
   
• South Korea says it has enacted the world’s first comprehensive set of laws governing artificial intelligence.
   
• Meta Platforms and EssilorLuxottica are facing a lawsuit filed by Solos Technology, alleging the companies infringed on its patents for smartglasses technologies.

Also, a suspicious $400,000 prediction-market trade flags risks in monetizing political outcomes. James Rundle hosts.

You can listen to new episodes every Friday on Apple Podcasts, Spotify and Amazon.

China built a vast oil stake in Venezuela. Now it risks getting muscled out.

When Venezuela booted out American oil companies in a nationalization campaign nearly two decades ago, China stepped in. Now, Beijing’s foothold there is in doubt as the U.S. asserts new power over Venezuela’s oil patch.

​​Chinese government-owned oil companies hold claims to more than 4 billion barrels of Venezuelan oil, nearly five times as much as the only U.S. major that today produces in the South American nation, Chevron. Beijing’s production deals, oil rigs and debt-backed supply arrangements have long bought it enormous sway in Venezuela—all of it now suddenly subject to the Trump administration’s preferences.

• Two European Companies—With a Big Unpaid Bill—Want to Help Rebuild Venezuela’s Economy

Expansive winter storm snarls the central and eastern U.S..

A massive winter storm is disrupting swaths of the U.S., dropping snow, freezing roads and causing thousands of flight cancellations and power outages.

More than 200 million people were in the path of the storm, which is straining the nation’s power grid and travel infrastructure. The storm already has been blamed for roughly 11,500 flight cancellations, affecting airports from Dallas to Boston, and has left more than 1 million power customers in the dark, mainly in the South.

• Greenland is rich in natural resources, such as metals and other rare-earth minerals. But actually getting those resources out of the frozen ground is no simple matter.
   
• The U.K. government has issued a warning that deforestation-led biodiversity loss and climate change pose national security threats to the country and the rest of the world, amid worries over crop failures, natural disasters and infectious disease outbreaks stemming from global warming.
   
• Israel’s reliance on new Palestinian militias in Gaza to target Hamas was on display earlier this month when Hussam Al Astal, the leader of one of the groups, boasted about the killing of a police official in Hamas-controlled territory and said more such attacks are planned.
   
• The Pentagon struck a conciliatory tone toward Beijing in its new defense strategy, stating that its overarching goal is to establish “strategic stability” in the Indo-Pacific region and de-escalate tensions with the Chinese military.
   
• Prime Minister Mark Carney came into office almost a year ago trying to build warm relations with President Trump. Now, he’s playing hardball.

Explore The Wall Street Journal: From Headlines to Action

Join us for a deep dive into the challenges that CFOs and other top executives are seeking to overcome, including the impact of tariffs and geopolitical conflicts on corporate finance and private equity.

Have a question you’d like to submit in advance? Send your question to wsjcorporate@dowjones.com and we’ll address your questions during the Q&A.

• Senate Democrats angered by the deadly shooting in Minneapolis said they wouldn’t vote for a government funding package without major changes to its homeland security provisions, raising the possibility of a partial government shutdown this coming weekend.
   
• China’s senior-most general is accused of leaking information about the country’s nuclear-weapons program to the U.S. and accepting bribes for official acts, including the promotion of an officer to defense minister, said people familiar with a high-level briefing on the allegations.
   
• A former Canadian Olympic snowboarder accused of running a drug-trafficking gang affiliated with the Sinaloa Cartel was taken into custody in Mexico as FBI Director Kash Patel was conducting a high-profile visit to the country.
   
• This article was coded by two columnists who don’t know how to code. Instead, they got Anthropic’s buzzy Claude Code to do it for them.