BankThink

Receiving Wide Coverage ...Unveiled: The Office of the Comptroller of the Currency issued detailed guidelines for bank consultants, or "Wall Street's shadow regulators" (hmmm, where have we heard that term before?) on Tuesday. The guidelines require, among other things, that banks "disclose all work a consultant performed for the institution over the past three years" and "document disciplinary actions taken against the consultant and the resources the firm has to complete an assignment" in an attempt to prevent conflict of interests. Bank consultants have come under scrutiny over the past year, thanks largely to a botched foreclosure review (which saw them paid $4 for every $1 to homeowners) and a one-year ban from consulting for New York banks on Deloitte, courtesy of Benjamin Lawsky, who alleged the firm violated banking law when it reviewed Standard Chartered's anti-money laundering practices. Lawsky has also subpoenaed Promontory Financial and PricewaterhouseCoopers in connection with their work on money-laundering cases. "The scrutiny, while it might not erode the consulting industry's profits, could cost consultants individual assignments and undermine their credibility in Washington and on Wall Street," the Times notes.

Sen. Elizabeth Warren garnered support on Tuesday at a Wall Street reform event in Washington D.C. to help end "too big to fail."

Americans for Financial Reform and the Roosevelt Institute have plans to release a joint paper Tuesday assessing policymakers' progress in implementing the Dodd-Frank Act.

Industry-accepted standards would reduce friction and costs in satisfying compliance requirements during a time of heightened scrutiny for banks and their vendors.

At some point, the CFPB may start asking if issuers' credit scoring models negatively affect minority credit card applicants more than white applicants.

Receiving Wide Coverage ...Former TARP Head Tapped for CFTC Post: President Obama Tuesday will nominate Timothy Massad, the assistant Treasury secretary who oversaw the Troubled Asset Relief Program, to serve as chairman of the Commodity Futures Trading Commission. If confirmed by the Senate, Massad will take over an agency in the midst of a massive post-financial crisis overhaul led by current chairman Gary Gensler, whose term ends at the end of the year. As head of TARP, Massad has overseen the government's bailout of banks and other institutions and leads the effort to wind down the Treasury's investments in these corporations, like the $49.3 million auction of preferred shares in seven financial institutions that closed last week. The CFTC has been at the center of several contentious battles involving the application of Dodd-Frank, notes Politico, and is charged with setting oversight of the Volcker Rule, the Washington Post says. Massad was considered among the frontrunners to head the CFTC when word first spread of Gensler's decision to leave the post. But partisan politics may hinder Massad's confirmation, and consumer advocates remain skeptical of his pedigree as a corporate lawyer specializing in financial securities and derivatives matters, says the New York Times — though before his 25-year tenure at Cravath Swaine & Moore LLP, the Harvard-educated attorney began his career as an assistant to Ralph Nader, notes the Wall Street Journal.

The 2008 financial crisis forced the Fed and Treasury into a too-cozy relationship and the Dodd-Frank law cemented it. Janet Yellen should use her confirmation hearing this week to reassert the central bank’s independence from the administration, argues editor-at-large Barbara Rehm

SaaS-based technology provides a blended approach to remittance processing that enables financial institutions to outsource infrastructure responsibilities, while retaining the management of transaction processing, bank deposits and receivable updates.

Fidelity Investments, BlackRock Inc. and PIMCO were among more than two dozen firms, industry stakeholders and lawyers that filed letters in an effort to discount the credibility of a report released by the Office of Financial Research labeling asset management firms as systemically important.

The proposed treatment of mortgage securities and associated mortgage financing activities will constrain the sector while handicapping efforts to bring private capital back to the secondary market.