BankThink

Last week, my organization, the Center for Financial Services Innovation, released a set of principles and best practices for delivering the kinds of everyday products and services consumers need to manage their financial lives. We call them the "Compass Principles," and we believe they have the potential to create a more enabling environment for financial services innovation that is positive for consumers and promotes competition and profits.

Banks are pushing mobile devices for payments, but there may be an untapped – and more immediate – opportunity to use mobile for security improvements on mainstream payment types.

Receiving Wide Coverage ...Freddie Flub? Freddie Mac may have missed out on billions of dollars it could have recouped from claims on defaulted mortgages, according to a report due today from the Federal Housing Finance Agency's inspector general. The report also criticizes the $1.3 billion settlement Freddie reached with Bank of America in January, calling the deal inadequate. Wall Street Journal, New York Times

A "don't waste a good financial crisis" moment has arrived. The G-20's Financial Stability Board is set to convene a global workshop on how to create and administer a global identification standard for businesses and their ownership structures involved in the financial supply chain.

Many users have criticized a recent redesign Facebook made to its social networking site, but the company may have pleased hackers by making personal information easier to dig up.

Receiving Wide Coverage ...Fault Found in STARS: The feds are fighting five domestic banks over transactions Barclays arranged that allegedly exploited discrepancies in U.K. and U.S. tax laws to stiff Uncle Sam for billions, a joint investigation by the Financial Times and ProPublica found. The deals, known as "structured trust advantaged repackaged securities," or STARS (one of those names that makes us suspect the investment bankers started with the acronym and then decided what words it would stand for), were so complex that a Harvard-educated federal judge adjudicating one of the court cases couldn't make heads or tails of them. So we're not even going to try to give you a pat summary, but the FT has a nifty interactive feature that explains the structures in relatively simple terms. "Foreign tax credits are designed in US law to prevent double taxation of companies that do business overseas," the FT says. "Because US companies are taxed on their worldwide income, they are allowed to claim credit for taxes paid in foreign jurisdictions so as to keep their tax bill essentially neutral." But the IRS alleges the STARS deals "were 'foreign tax credit generator' schemes to reap credits even when there was no double taxation." Aside from the four U.S. banks that used STARS - BB&T, Bank of New York Mellon, Sovereign and Wells Fargo - the government is also tussling with AIG over a different kind of a foreign tax credit deal that dates back to the 1990s. One of the masterminds behind these transactions was a young Joseph Cassano, who would go on to lead the infamous Financial Products group whose gambles led to AIG getting bailed out by the government in 2008. Finally, on a related topic, Washington Post columnist Allan Sloan proposes that the FASB require U.S. companies to disclose how much federal income tax they pay "so that we could have an informed discussion" -- he notes that some well-intentioned press stories have blundered by confusing accounting and tax figures.

Although financial institutions have been developing and implementing Anti-Money Laundering programs for at least a decade, many still seek to develop more effective practices for identifying and minimizing risk.

What if NCUA had used college football rankings to decide which corporates survived and which didn't. Would the CU community have been better off?

The feds are fighting five domestic banks over transactions Barclays arranged that allegedly exploited discrepancies in U.K. and U.S. tax laws to stiff Uncle Sam for billions, a joint investigation by the Financial Times and ProPublica found.

Cody Andrew Kretsinger was arrested in Arizona Tuesday for allegedly hacking Sony Corp.'s movie business in May.