The Morning Risk Report: Nvidia Leads Defense of Open-Source AI With New Cybersecurity Initiative By David Smagalla | Dow Jones Risk Journal
Good morning. Nvidia is leading a new coalition of tech companies
that want the U.S. government and its allies to see open-source artificial intelligence as a cybersecurity asset, not a threat.
What's the group? Dubbed the Open Secure AI Alliance, the Nvidia-backed group said Monday it aims to create and deploy a suite of open-source AI tools that any company can use to defend against cyberattacks. The group includes SpaceX, Microsoft, Palantir and dozens of other companies, many of which publicly oppose restricting access to open-source AI.
Dealing with vulnerabilities: It is the latest salvo in a battle over the future of open-source, or open-weights, AI tools amid growing concern from government and industry officials about AI systems causing cyberattacks. Those fears have prompted the White House to increase oversight of AI models and push the private sector to deploy AI for defensive purposes.
What are open-weights models? Open-weights models have been the focus of growing scrutiny after new models from Chinese developers like Moonshot and Z.AI wowed developers and won a growing number of U.S. users. Open models are free to download and allow users to customize them for their own needs, although operating any model comes with computing costs.
Why the concern? Critics, including some top executives at Anthropic and OpenAI, have argued that open models, many of which come from China, present potential risks to national security, and Trump administration officials have weighed a ban on them.
The top story in Monday's Morning Risk Report, "Can AI Serve on Boards," didn't include a free link to the story. To read how more corporations are turning to artificial intelligence to help in the boardroom, click here .
Compliance
Ex-JPMorgan banker alleges racism, sexual assault in federal lawsuit.
A former JPMorgan Chase banker alleged widespread racial discrimination and harassment
on the bank's leveraged-finance team in federal court, introducing new civil-rights charges in a case whose lurid details have captivated Wall Street.
Chirayu Rana had alleged a pattern of sexual assault and harassment by a former co-worker, Lorna Hajdini, in a state lawsuit filed against her and the bank in April that quickly went viral.
In a federal complaint filed Monday, Rana reiterated allegations that his superiors called him racist names while he was the only nonwhite member of the team and that he was sexually assaulted. Rana joined the bank in 2024 and left the following year. The new lawsuit names three additional former JPMorgan colleagues as defendants.
U.S. to ease Venezuela-related scrutiny on banks.
The Trump administration told banks it will hold off on future law enforcement actions
over anti-money-laundering shortcomings related to Venezuela, reports Risk Journal's Richard Vanderford, provided the institutions have reasonable compliance programs in place (free link)
The details: The Treasury Department's Financial Crimes Enforcement Network said Monday it won't bring actions under the Bank Secrecy Act, which sets out AML law, for transactions through Jan. 29, 2027. FinCEN said it consulted with other federal banking regulators in putting forward the new guidance. The new policy is meant to promote Venezuela's economic development, FinCEN said.
The U.S. announced sanctions on key components of what it described as a global sanctions-evasion network
built by Iranian financier Babak Zanjani, who in 2016 was sentenced to death in Tehran for embezzling billions in government funds. His sentence was later commuted after he returned much of the embezzled money (free link).
The Council of the EU sanctioned six judges
from Iran's regional Revolutionary Courts and a computer hacker working with the Islamic Revolutionary Guard Corps over "serious human rights violations," Risk Journal reports (free link).
U.N. Secretary-General António Guterres on Sunday called for the complete removal of remaining Syria sanctions , while stressing that the country's "recovery will depend on much more" (free link).
Johnson & Johnson agreed to pay $5.5 billion
to resolve remaining lawsuits that alleged the company's talc products caused ovarian cancer, with the goal of putting an end to litigation that has been going on for more than a decade.
New York City officials halted construction
at 222 Broadway, marking the second office-to-apartment conversion project shut down this month. Risk
Cracker Barrel CEO stepping down after logo controversy, activist pressure.
Cracker Barrel Chief Executive Julie Masino is stepping down , ending a three-year tenure that promised significant changes to the family dining chain but put it at the center of a political firestorm before she walked back some of her plans.
What she tried to do: Masino sought to update the brand that first opened in 1969 for a younger generation of consumers, with initiatives that included remaking the folksy logo atop Cracker Barrel restaurants, pulling antique tchotchkes off the walls and changing the menu.
What ended up happening: But many of the changes ended up alienating some core diners and conservatives. The resulting controversy, magnified on social media by online bots, led her to scrap much of her strategy and contend with plummeting sales and profit. The company's stock price fell sharply, and Masino cut staff and costs to try to stem the losses.
Ukrainian drones have hit military-supply lines
connecting Russia and Iran through the Caspian Sea, exploiting a new front in two increasingly intertwined wars.
The sudden passing of Sen. Lindsey Graham has deprived Israel of a rare friend -one who was both an ardent supporter and politically powerful-at a time when energetic factions in the Republican and Democratic parties are turning against the country.
Two of the world's most important shipping lanes have been gummed-up by the Iran War , and a third is now having its own problems because of weather. The slowdown could drive up prices for everything from oil to home goods.
Demand for U.S. durable goods rose less than expected in June , according to data published by the Commerce Department.
Brazilian President Luiz Inácio Lula da Silva is fighting alleged efforts by the U.S. and right-wing leaders across Latin America to influence October's election . What Else Matters The Trump administration on Monday asked the Supreme Court to allow federal agencies to implement an executive order that would restrict mail-in ballots
and create lists of people deemed eligible to vote ahead of the November midterms.
Ford Motor is chasing its biggest military contract
since the Cold War.
Bernard Arnault has spent decades carefully cultivating the image of some of the world's most sought after brands, from Louis Vuitton to Dior. Now the LVMH chief is changing tactics
when it comes to his own.
Three people were killed and four others wounded after getting caught in crossfire
between two shooters at a Seattle food festival, authorities said. About Us
Follow us on LinkedIn . Send tips to our reporters Max Fillion at [max.fillion@dowjones.com], Clara Hudson at [clara.hudson@wsj.com], Yusuf Khan at [yusuf.khan@wsj.com] and Richard Vanderford at [richard.vanderford@wsj.com].
You can also reach us by replying to any newsletter, or by emailing our editors Perry Cleveland-Peck at and David Smagalla at [david.smagalla@wsj.com].
This article is a text version of a Wall Street Journal newsletter published earlier today.
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