On February 10, 2026, U.S. District Judge Jed Rakoff of the Southern District of New York issued a bench ruling holding that a defendant’s use of generative AI to analyze legal exposure is not protected under attorney-client privilege or the
Subject to Inquiry
THE LATEST ON GOVERNMENT INQUIRIES AND ENFORCEMENT ACTIONS
The Subject to Inquiry blog, published by McGuireWoods LLP, focuses on legal developments and regulatory compliance issues affecting various industries. It covers topics such as anti-money laundering (AML) and Bank Secrecy Act (BSA) compliance, financial institution regulatory changes, cybersecurity standards for defense contractors, privacy law enforcement by state attorneys general, and False Claims Act settlements related to cybersecurity violations. The blog provides updates on legislative proposals, regulatory agency actions, enforcement trends, and best practices for compliance in areas including financial services, government contracting, data privacy, and cybersecurity.
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OFAC Enforcement Action Against Academic Institution Provides Important Compliance Guidance
On February 12, 2026, Treasury’s Office of Foreign Assets Control (OFAC) announced the settlement of an enforcement action against IMG Academy (“IMG”) that highlighted the sanctions risks that U.S. academic institutions face and the steps OFAC recommends the institutions to…
When AI Isn’t Privileged: SDNY Rules Generative AI Documents Not Protected
Executive Summary
- Independent, unsupervised use of generative AI to analyze legal exposure may not be privileged. A federal court held that a defendant’s AI prompts and outputs relating to a criminal investigation of his conduct were not protected after they
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DoW Announces Line-by-Line Review of Certain 8(a) Contracts Amid Government-wide Scrutiny of the 8(a) Program
On January 16, 2026, the Secretary of War Pete Hegseth posted a video on social media announcing that the Department of War will conduct a “line‑by‑line review of every small business, sole source, 8(a) contract that is over $20 million,”…
Creation of DOJ Fraud Division Signals Increased White-Collar Enforcement
On Jan. 8, 2026, the White House announced the establishment of the DOJ’s Division for National Fraud Enforcement. The Trump administration stated that the new division will “combat the rampant and pervasive problem of fraud in the United States” and…
FinCEN Announces Data-Driven Operation Targeting Southwest Border MSBs
On December 22, 2025, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced a multifaceted data-driven operation to address potential money laundering, focused on more than 100 U.S. money services businesses (MSBs) operating along the southwest border.…
Reducing BSA Compliance Obligations? A Look at the Senate’s STREAMLINE Act
The Senate has introduced the Streamlining Transaction Reporting and Ensuring Anti-Money Laundering Improvements for a New Era Act, or the STREAMLINE Act, an initiative led by Senate Banking Committee Chairman Tim Scott and Senator John Kennedy, with support from…
FinCEN Eyes Easing Compliance Burdens on Financial Institutions
The Financial Crimes Enforcement Network (“FinCEN”) has recently taken two steps in furtherance of the Trump Administration’s deregulatory agenda. In late September, FinCEN posted a notice to the Federal Register soliciting comments on a proposed “Survey of the Costs of…
Department of Defense Issues Final Rule on Cybersecurity Standards for Contractors
After years of waiting, the U.S. Department of Defense (DoD) posted to the Federal Register for public inspection on September 9, 2025, a final rule implementing the Cybersecurity Maturity Model Certification 2.0 (CMMC 2.0) standards into the Defense Federal Acquisition…
State AGs Step Up Enforcement: Recent Lessons from Privacy Law Enforcement in Connecticut and Nebraska
As comprehensive state privacy laws continue to take root across the United States, recent enforcement actions by the attorneys general of Connecticut and Nebraska highlight an important shift — ensuring privacy law compliance vis-à-vis comprehensive privacy laws or other means…