Greetings,

The US government's portal for processing some $166 billion in tariff refunds is live, (reportedly) with just minor glitches so far. Meanwhile, the Supreme Court will consider a challenge to the Securities and Exchange Commission's power to recover profits that have been made from illegal activities. More on that below.

Also in this edition:

• Private credit stress risks hitting PE deals
• Citi, JPMorgan racing forward on digital payments
• Fed's Powell flags US debt as top financial crisis risk
• Commerce secretary: USMCA needs to be "reconsidered"

The Supreme Court will hear arguments challenging the SEC's use of disgorgement to recoup illicit profits. Critics argue the SEC uses disgorgement to enrich the Treasury rather than compensate victims, while supporters say it is crucial for investor protection. The case, involving Ongkaruck Sripetch, could impact high-profile cases, including the SEC's lawsuit against Elon Musk.

Rising stress in private credit markets is threatening to spill over into private equity, where buyouts have heavily relied on non-bank financing since 2008. Any deterioration in credit conditions could pressure deal activity and valuations, exposing vulnerabilities across the closely linked sectors.

Citigroup and JPMorgan Chase are going head-to-head in the emerging digital payments landscape. Both banks are building infrastructure for blockchain-based payments, but their approaches differ: JPMorgan is focusing on in-house, proprietary systems, while Citigroup is turning to partnerships, notably collaborating with Coinbase for stablecoin integrations. Each bank is racing to capture market share, expecting major growth in tokenized transactions and real-time payments.

Investors are shifting to riskier debt amid hopes that the US and Iran can extend their truce, with BBB-rated companies outperforming higher-rated peers, and junk bonds seeing a $2.8 billion inflow. However, some investors remain cautious, especially about companies increasing leverage for AI projects.

Private credit is increasingly targeting consumer debt, as evidenced by a recent deal in which Bilt shifted $1.2 billion in credit card balances to private credit after Wells Fargo withdrew as a partner. This trend is driven by private credit funds' need for high-yield investments, with firms such as Blue Owl Capital and Stone Point Capital actively participating. Private credit held $350 billion in consumer loan balances in 2025, and the funding mechanism is gaining traction in sectors such as auto and student loans.

With today's launch of a new online portal, importers can now begin filing claims to recover tariffs they paid over the past year. The process requires significant preparation, including gathering documentation and ensuring eligibility as the "importer of record." While there is expected to be a high volume of initial applications, not all businesses will be ready immediately, and not all imports qualify in this first phase. The government has published guidance to help importers navigate the process, but only those who directly paid the tariffs can claim refunds.