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Treasury: Half of All Suspicious Activity Reports Are Incomplete, Go Unused

WASHINGTON-The Treasury Department's Office of the Inspector General said that more than half of the suspicious activity reports filed by depository institutions and money-service businesses are incomplete and don't get used. Sixty-two percent of the reports sampled had empty fields such as a suspect's social security number, date of birth or phone number and because of this went ignored, it said, according to The American Banker. Law enforcement officials say that such information is critical in following up on a report.

The Inspector General's study blamed the Financial Crimes Enforcement Network for the problem and said that filers need more training to file accurate reports. The survey was based on a sample of 406 reports out of 416,000 reports filed in 2003. Since then there has been an "explosion" in the number of "defensive" filings following large fines imposed on AmSouth Bancorp and Riggs National Corp.

Rise In 'Phishing' May Be Slowing

REDWOOD CITY, Calif.-The number of occasions when e-mails were sent trying to trick consumers into entering a fake bank page rose only 2% in February to 13,141 from the previous month, only 2% more than in January, said the Anti-Phishing Working Group, The American Banker reported. The Redwood City-based group said the monthly average since July had been 26%. Sixty-four bank and online retailer brand names were affected in February.

FDIC Study Examines Indicators of Pending Failure

WASHINGTON-The Federal Deposit Insurance Corp. studied about 2,000 banks with low CAMEL supervisory ratings and said asset quality provided the best clue as to whether they would fail and not capital levels as many assume, The American Banker said.

Banks that recovered were less likely than other banks to experience "increases in loan-loss reserves, average loans and leases past due ..." the report said.

The study offers a new model for predicting four possible outcomes for a bank in trouble: failure, continuing to struggle, being acquired or recover.

The current model only aims to predict two outcomes: failure or not.

Consumer Loan Delinquencies Decline, Likely To Remain Flat For Year

WASHINGTON-Consumer loan delinquencies have declined and the outlook would remain good at least for some time in the future, said James Chessen, chief economist of The American Bankers Association, according to a report on The American Banker daily.

Credit card delinquencies dropped to 4.2% in the fourth quarter, six basis points lower than in the third quarter, while home-equity loan delincuencies fell 45 basis points to 2.37%. Auto loans delinquencies fell 20 basis points to 2.09% and personal loan delincuencies fell six basis points to 1.9%, the daily said.

Chessen said that rising oil prices could hurt the outlook more than small rate increases. The American Banker said that a 25-basis point increase that raises the cost of borrowing $1,000 by $2.50 a year whereas higher gas costs hit consumers weekly. "When it costs, conservatively, $10 to $15 more per fill-up this year than last, that is a significant burden," he told The American Banker.

Fireman's Fund Insurance Offering Identity Theft Restoration Services

NOVATO, Calif.-Fireman's Fund Insurance Co. is offering identity theft restoration services to its customers who have Prestige Home Premier with Added Measure coverage, The American Banker said.

Fireman's Fund will offer as part of the service, that comes with no deductible, toll-free access to a personal advocate, notification to relevant agencies, credit monitoring and fraud alerts.

Internet Bank Start-Up Is Aimed At Black Americans

BOSTON-The former chief financial officer of the black-owned OneUnited Bank, James Mundy, is seeking to raise $17.3 million by June to open up an Internet bank that would try to gain accounts from black people who earn more than $50,000 annually, The American Banker said.

Mundy plans to open up BankBlackwell by late summer and the bank, like OneUnited Bank, would be based in Boston. It would be the first bank targeting black people across the nation. The Federal Deposit Insurance Corp. classifies 47 banks in the country as black-owned, but most are confined to specific areas.

BankBlackwell gained approval from the Office of Thrift Supervision in December.

The American Banker said that one of BankBlackwell's board members is Omar Wasow, executive director of online community forum BlackPlanet.com, which claims 14 million members.

Joseph Gladue, an analyst who covers minority-owned institutions for Cohen Bros. in Philadelphia, said that it may be hard for BankBlackwell to attract customers as affluent blacks on the Internet may already have banking relationships, The American Banker reported. Robert P, Cooper, senior counsel at OneUnited Bank, also said that a black-owned bank must have branches in black neighborhoods.

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