Good morning from New York. Dow Jones Risk Journal on Wednesday hosted its second of a series of global summits here. Some highlights:

• AI strikes again: Artificial intelligence is making sanctions and export control evasion schemes harder to detect, Risk Journal’s Max Fillion reported.
   
• Cryptocurrency in the crosshairs: Cryptocurrency, artificial intelligence and cybersecurity top the list of concerns for the New York State Department of Financial Services, Kaitlin Asrow, acting superintendent of the state’s top financial regulator, told Mengqi Sun.
   
• Cartel crisis planning: Businesses operating in Mexico need to step up their risk planning as the U.S. war on drug cartels continues, experts said.
   
• And more: Executives from Lockheed Martin, MoonPay, Citi, Adobe and other organizations spoke on a range of topics with Risk Journal reporters and experts from advisory and law firms. Scroll down today and check out the Morning Risk Report later this week for more coverage.

AI making sanctions, export controls evasion harder to spot.

Artificial intelligence is making sanctions and export control evasion schemes harder to detect, a trade lawyer said.

Companies and people otherwise blocked by sanctions and export controls can use the technology to create webpages and documents to legitimize fake companies that allow them to get around blacklistings, Aiysha Hussain, a trade partner with law firm Mayer Brown, said Wednesday at the Dow Jones Risk Journal Summit.

• As concerns about private-markets funds mount, Wall Street’s top regulator on Wednesday reiterated his commitment to opening these investments to more ordinary people. But Paul Atkins, the chair of the Securities and Exchange Commission, said this expansion must be balanced with investor protections.
   
• Global authorities must step up their surveillance of lending by nonbank players such as hedge funds and institutional investors to minimize risks to financial stability, Bank of Canada Gov. Tiff Macklem said.
   
• The European Union’s top industry official proposed new rules designed to support companies manufacturing low-carbon technologies like wind turbines and electric-vehicle batteries in Europe.

• “Compliance used to be relegated to subbasement B. It’s become a little more important.”
  —Daniel Tannebaum, a former U.S. Treasury sanctions official who is now the global anti-financial crime practice leader at Oliver Wyman.
   
• “I only hire senior lawyers now.”
  —Beth Essig, general counsel at Mount Sinai Healthcare system, on how artificial intelligence is impacting the hiring of junior staff.
   
• “I believe it’s very clear that prediction markets are not in [our] remit. I know there are questions at the federal level on who is the appropriate overseer of that.”
  —Kaitlin Asrow, acting superintendent of the New York State Department of Financial Services.
   
• “There’s AI for compliance and there’s compliance for AI. They sound the same, but they are two relatively different things.”
  —Win Chevapravatdumrong, partner and general counsel at M13.
   
• “While there’s this debate going on in Washington, it’s so critical that the agencies keep moving forward.”
  —Caroline Pham, chief legal officer at MoonPay and former acting head of the Commodity Futures Trading Commission, on cryptocurrency regulation.

Strait of Hormuz: The oil bottleneck threatening the global economy.

President Trump’s promise to protect the Strait of Hormuz with naval escorts and provide government-backed marine insurance underscores the urgent need to restore flows of energy from the Middle East before soaring prices rip through the world economy.

As of Wednesday, day five of the war on Iran, several thousand ships were stuck inside and outside the Persian Gulf, trapping roughly a fifth of the oil and liquefied natural gas the world consumes each day. The blockage is cascading through the region’s industry as storage tanks fill up with oil that can’t set sail, forcing producers to slash output.

• See the Strait of Hormuz Shutting Down
• Broadening Mideast Conflict Risks Pulling In U.S.’s NATO Allies
• Container Shipping Companies Halt Bookings, Divert Vessels Due to Middle East Risks
• The Missiles Hit the Gulf With No Warning. Then the Escape Planning Began.
• Russia Is Big Winner as Iran War Drains Supplies That Ukraine Needs
• Some European Leaders Are Now Openly Challenging Trump Over Iran

Judge orders government to begin refunding more than $130 billion in tariffs.

A federal trade-court judge on Wednesday ordered the Trump administration to start refunding the more than $130 billion it collected in the global tariffs invalidated by the Supreme Court last month.

At a hearing involving one company’s fight for a refund, Judge Richard Eaton at the Court of International Trade said the repayment process should be straightforward. He issued a written order following the hearing that directed the administration to begin the process of refunding importers and set a hearing for Friday at which he asked for updates.

More than 2,000 lawsuits have been filed by companies in the court seeking to recoup their money.

• The U.S. military said that it launched a joint operation with Ecuador against drug gangs as the Trump administration expands its campaign against drug traffickers in Latin America.

• OpenAI’s former research chief aims to automate manufacturing with AI.
   
• Agents and managers are helping influencers make millions.
   
• GOP Rep. Dan Crenshaw became the first House incumbent to lose in a 2026 primary, marking a rebuke by voters of the Texas Republican who was once viewed as a rising star in the party.
   
• Can AI save local news?

Follow us on X at @WSJRisk. Send tips to our reporters Max Fillion at max.fillion@dowjones.com, Mengqi Sun at mengqi.sun@wsj.com and Richard Vanderford at richard.vanderford@wsj.com.

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