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The Federal Communications Commission (FCC) has made a ruling declaring robocalls that use voices generated by artificial intelligence (AI) as illegal. The decision comes in response to concerns about the misuse of AI technology for scams and voter deception. FCC Chairwoman Jessica Rosenworcel stated that AI-generated voices are being used by bad actors to extort vulnerable individuals, imitate celebrities, and misinform voters. The ruling allows the FCC to impose fines and block telephone companies that carry these calls. It also enables victims to sue AI-powered robocallers and provides state attorneys general with additional tools for prosecution. The use of AI to mimic the voices of loved ones in danger for extortion purposes has also been on the rise. The FCC's ruling aims to curb these fraudulent practices and protect consumers from AI-robocall scams.

 

The Columbian

NPR / National Public Radio

Chicago Tribune

Allstate Corp., Starbucks Corp., and other major companies are increasingly mentioning AI in their disclosures to investors. According to Bloomberg Law's review, over 40% of S&P 500 companies mentioned AI in their most recent annual reports. The Securities and Exchange Commission (SEC) is closely monitoring these discussions about the opportunities and risks of AI for businesses. SEC Chair Gary Gensler has warned companies against making misleading AI-related claims, and the SEC may take legal action against such practices. The SEC is also scrutinizing whether companies adequately warn investors about AI-related risks. The use of AI in businesses is on the rise, and companies from various industries are addressing its risks and benefits. The SEC is particularly concerned about AI-washing, where companies make exaggerated claims about their use of AI. Companies that overhype their use of AI could face legal consequences if the technology does not significantly transform their operations. The SEC is also interested in the risks posed by AI being used by others. Companies are increasingly discussing AI on earnings calls and in their annual reports, with a majority of the disclosures focusing on the risks associated with the technology. However, some companies are also highlighting the benefits of AI in their business initiatives. The SEC is drawing parallels between AI and cybersecurity, where companies have faced regulatory actions for inadequate risk disclosures.

 

Bloomberg Tax

AICPA has recommended that the Financial Crimes Enforcement Network (FinCEN) automatically grant filing deadline postponements for the Report of Foreign Bank and Financial Accounts (FBAR) to align with the relief provided by the IRS. Currently, taxpayers in disaster areas receive filing deadline postponements from the IRS, but FinCEN does not automatically grant the same relief for FBARs. The AICPA suggests that FinCEN adopt a policy to match the relief provided by the IRS, both in terms of extended due dates and geographic scope. This recommendation aims to provide consistency and fairness for taxpayers impacted by major disasters.

 

CPA Practice Advisor

EU antitrust regulators will now consider the digital ecosystems and impact of free products or services offered by Big Tech companies in their investigations. The European Commission has updated its rules to account for the changing tech markets and the exchange of user data for free products or services. The update will allow regulators to define a company's market power based on multisided platforms, digital ecosystems, and free products. Market share can be determined by sales, capacity, active users, or website visits. The update also emphasizes non-price elements such as innovation, reliable supply, and product quality. The inclusion of imports and their impact on EU businesses is another new element in the assessment.

 

Reuters

First Citizens BancShares has accused HSBC executives, including CEO Noel Quinn, of condoning a plan to steal employees and confidential information from Silicon Valley Bank (SVB). The lawsuit alleges that David Sabow, who previously worked at SVB, met with Quinn and other top executives to share plans of poaching workers in order to launch a competing venture capital business. First Citizens claims that Sabow and five other former SVB officials took client information and trade secrets and convinced over 40 employees to join HSBC. HSBC denies wrongdoing and states that Sabow's recruitment efforts predated First Citizens' takeover of SVB. The case is ongoing.

 

Reuters

Elon Musk's X Corp., known for its support of free speech, is financing lawsuits for users facing backlash from employers over their social media posts. Schaerr Jaffe, a trial and appellate litigation boutique, is representing Gina Carano in a lawsuit against Disney. Musk has encouraged others to join in and pursue cases against Disney. Schaerr Jaffe, with partners H. Christopher Bartolomucci, Donald Falk, and Edward Trent, is working on the Disney case. Schaerr Jaffe has a history of taking on high-profile cases and has represented clients such as Virginia “Ginni” Thomas. Musk's X Corp. is actively hiring litigators and has recently hired senior counsel Zacharia “Zack” Chibane and legal counsel Austin Rocker. X Corp. is making headlines with its support for users and its involvement in lawsuits.

 

Bloomberg Law

Georgia's ruling Republicans are pushing a bill that would make it more difficult for workers at companies receiving economic incentives to join labor unions. The bill, backed by Gov. Brian Kemp, would require a formal secret-ballot election for companies to recognize unions, blocking unions from gaining recognition through a majority sign-up process. Union leaders and Democrats argue that the bill violates federal law and the right to voluntary recognition. The bill, modeled after a law in Tennessee, is part of a larger trend of Southern states opposing unions. Republicans claim the bill protects workers from being coerced into joining unions, while Democrats argue it hinders union organizing. The bill now moves to the House for further debate.

 

U.S. News

Goldman Sachs is being sued by Hollywood business management firm, KSFB Management, for allegedly deceiving them during a mergers and acquisitions deal. KSFB claims that Goldman misled them while pursuing a $7bn deal with a private equity firm. The suit alleges that Goldman deceived KSFB when they were seeking to sell themselves in 2022, and that KSFB provided confidential information that helped Goldman arrange a different acquisition. This is the second lawsuit filed by KSFB, with the first being dismissed in Los Angeles. KSFB is seeking damages for fraudulent conduct and violations of state law. Goldman and Focus Financial Partners, the investment group involved in the deal, have not yet commented on the lawsuit.

 

Bloomberg

The London Metal Exchange (LME) is facing legal action over claims it is “trading in dirty metals.” Global Legal Action Network (GLAN) and the London Mining Network say that by enabling the global sale of dirty metals, LME is breaching anti-money laundering legislation. The legal action filed in the High Court says copper derived at the Grasberg mine in Indonesia is “criminal property” as it is produced in circumstances that would breach criminal law if they were to occur in the UK. GLAN lawyer Stéphanie Caligara said: “This case is an opportunity for the LME and metal producers to align with consumer expectations and with standards that are key to ensuring a sustainable green transition.” An LME spokesperson said it believes that the claim is “misconceived.”

 

Barron's

City AM

Daily Mail

Flynn Group, the world's largest franchisee operator of restaurants and fitness clubs, is considering a majority stake sale that could value the company at over $5bn. The San Francisco-based company, which operates popular franchises such as Applebees, Taco Bell, Panera Bread, Arby's, Pizza Hut, Wendy's, and Planet Fitness, is working with Bank of America on the sale process. Private equity firms and sovereign wealth funds are among the potential buyers for the majority stake. Ontario Teachers' Pension Plan and private equity firm Main Post Partners, both investors in Flynn Group, may sell part of their stakes but remain invested. The company, founded in 1999, operates over 2,600 restaurants and fitness clubs in the U.S. and Australia, generating annual sales of over $4.5bn.

 

Reuters

Citigroup is considering cutting 51 roles in its London wealth business, which would affect about 10% of the unit's staff. The cuts are part of CEO Jane Fraser's strategy to boost returns and improve efficiency. The majority of the roles being eliminated are from the assistant vice president to director level, with 21 roles in the private bank division. Citigroup's wealth management operations are a key focus for the firm, and last year it hired Andy Sieg to reshape the division. The unit's efficiency ratio has increased to 99% in the fourth quarter, higher than the previous year. Citigroup is also undergoing a broader restructuring, aiming to cut 5,000 jobs by the end of Q1 and eliminate a total of 20,000 roles in the coming years.

 

Bloomberg

McKinsey & Co. has given a "concerns" rating to about 3,000 of its consultants, indicating unsatisfactory performance. These employees have about three months to improve, or they may be counseled to leave the company. While the proportion of employees receiving this rating is consistent with previous years, the increase in headcount has resulted in more employees receiving the rating. The consulting industry is facing a downturn as clients are delaying investments due to an uncertain macroeconomic environment. Other consultancies, such as Accenture and Ernst & Young, have already announced job cuts. McKinsey itself eliminated 1,400 roles last year. The company says it aims to help employees learn and grow, whether they stay at McKinsey or pursue opportunities elsewhere.

 

Bloomberg

Investors are calling on companies to prioritize climate change and environmental stewardship, according to a report by EY. The survey of institutional investors representing $50trn in assets found that while attracting and retaining talent was the top priority for companies in 2024, climate change ranked closely behind. The report highlighted a disconnect between investors and boards, with economic conditions and capital allocation being the top priorities for directors. Investors want companies to focus on reducing emissions and innovating for a clean-energy transition. They also want specific emission reduction targets, clear plans for achieving them, and the use of science-based metrics to track progress.

 

Law