This year's Phase 2 CTR exemption review was depressing due to the large number of exempted customers that did not meet the requirement for exceeding $10k in cash on at least five days in the past year. Did FinCEN and/or Regulators address this and perhaps I overlooked it?

There are no changes to the eligibility requirements for exemptions. You will have to revoke exemptions and then file new DOEPs after your customers again have five reportable transactions within 12 months.

Remember that you don't have to file a DOEP to revoke the exemptions -- you just have to resume filing CTRs on these customers. Once you have filed four CTRs and are about to file the fifth on one of the customers in a 12-month period, you can file a new DOEP to exempt them again.