BankThink

Receiving Wide Coverage ...StanChart Settles: Standard Chartered agreed to pay $340 million to settle Benjamin Lawsky's money-laundering charges, but it's unclear how far the U.K. bank actually budged from its initial position that most of the allegedly illegal transactions were kosher. "The parties have agreed that the conduct at issue involved transactions of at least $250 billion," according to the official statement from Lawsky's New York State Department of Financial Services. This sounds to us like a prosecutor saying “the defendant admits that I have accused him of pouring tar into those 250 mailboxes” — a far cry from brandishing a confession to all 250 acts of vandalism. Remember, Standard Chartered had insisted last week that only $14 million of the transactions were improper. Well, press releases are seldom lucid, so let's go to the actual settlement document to find out whether StanChart really admitted any wrongdoing. … Oh wait, there isn't one. According to the Journal, "The settlement took the form of a term sheet signed by [StanChart's CEO] that spelled out the key points in the agreement, including the monetary penalty, said people familiar with the matter. Because the deal was struck so quickly, the final settlement agreement is yet to be drafted in its full legal format." So just like the national mortgage settlement, the full contents of this deal won't be available for a while. In the meantime the public must rely on whatever information the anonymice choose to leak to the media. Wall Street Journal, Financial Times, New York Times, Washington Post

The Consumer Financial Protection Bureau issued a final rule exempting financial institutions that provide fewer than 100 remittances a year from new requirements for such services.

Dodd-Frank just turned two, but it'll be old before its time writes Dimitri B. Papadimitriou of Bard College. The legislation falls prey to the same flaw of most financial regulation: aiming to solve the last crisis instead of the next, he argues.

Money funds and non-deposit-taking consumer lenders should be chartered as limited purpose banks by the Fed and CFPB, respectively. This will reduce systemic risk, improve consistency and efficiency, and protect consumers.

A personal touch can help a bank stand out, but providing great service is a challenge in our increasingly digital society. How do you develop meaningful (and lasting) relationships with your customers?

Receiving Wide Coverage ...Still More StanChart: The money-laundering allegations against Standard Chartered have further strained relations between U.S. and U.K. financial regulators, which were already testy from recriminations after the Libor scandal, according to the Journal. In the FT, columnist Tom Braithwaite says U.K. officials come off "thin-skinned" in their rush to defend StanChart against the accusations by New York state regulator Benjamin Lawsky. "Implicit — and sometimes explicit — in the wave of London ire at Mr. Lawsky is that he is a publicity-seeking, showboating, impertinent arriviste. … Mr. Lawsky is all of those things. That doesn't make him wrong." One virtue of the surfeit of regulatory bodies in the U.S., Braithwaite argues, is that "if one agency is slow, ineffective or incompetent there are dozens of other men and women — especially the publicity-seeking, showboating types — who have some power to step in and tackle an issue."

The complaint against Wells Fargo highlights problems in comparing borrowers from different racial and ethnic groups.

The creation of Consumer Financial Protection Bureau and an emphasis from all regulators on unfair, deceptive, or abusive acts and practices has created new staffing demands. “Banks are scrambling to find compliance personnel with expertise in consumer protection law,” writes American Banker’s Andy Peters.

C. Boyden Gray, the lawyer involved in the suit challenging the constitutionality of the CFPB, writes in the Washington Times that "the new regulatory regime primarily helps the big banks while placing its heaviest burdens on community banks.”

Their regulator has achieved for them by administrative fiat what they have been unable to accomplish in Congress.