Banks try to enlist DMVs to fight identity fraud; Marcus haunts London
Wall Street Journal
Some of the largest banks in the U.S. are looking to link up with state motor vehicle agencies to help fight identity fraud. “Motor-vehicle departments are appealing partners for banks as more people are opening accounts online. At the DMV, applicants typically must appear in person, at least initially, with a stack of documents including birth certificates and social security cards that are verified by trained staffers. If banks can enlist DMV help, they could see big savings.”
Filling the vacuum
A divided Congress makes it less likely there will be a compromise on a remake of Fannie Mae and Freddie Mac, but “that provides an opportunity for the Trump administration to take steps on its own — and the industry is lobbying to soften any potential changes … The White House is expected to consider steps in the coming months that could reduce the government’s footprint in backstopping” the mortgage market. “The changes … could make it tougher and more expensive for people to get” home loans.
War against hackers
Aflac has installed tripwires in its corporate digital network in order to trick hackers into revealing their presence. “Cybercriminals who click on links disguised as employee credentials or sensitive human resources data in fact are raising a red flag for the security team. Aflac uses this deceptive technology as a last line of defense against hackers and rogue insiders who sneak around the company’s other security protocols.”
Win some, ...
Goldman Sachs’ online retail unit Marcus is “spooking” British competitors with its high-rate savings accounts, luring customers away or forcing them to raise rates to stay competitive. “Yes, we are worried about Marcus," one banker told Reuters. “We have seen significant outflows from our savings products although I question if they can keep growing at that speed.”
But the bank has to do more to clean up bad behavior, the paper says, such as what got it enmeshed in the Malaysian 1MDB scandal.
Simple, the American digital bank backed by Spain’s BBVA, has lured Amazon executive David Hijirida to become its CEO, “an example of talent moving from tech to banking rather than the other way around.”
“Banking was my first love, especially on the retail consumer side,” Hijirida said. “The reason why I left was really out of frustration with traditional banks and finding it very difficult to change those institutions from the inside.”
“Exploring the way technology is changing industry and society,” specifically how it its impacting banking and finance, gets a deep dive from the paper. One article looks at how American fintech companies are gaining ground by “behaving more like banks,” while a separate article explores five ways banks are responding to the competitive threat, including acquisitions and partnerships.
A third article looks at Arizona’s regulatory “sandbox” that “is a step towards opening up the fintech industry in a country whose regulatory landscape has until now put off many start-ups with its perceived heavy-handedness, and could make it easier for companies from outside the U.S. to test their products on the market.”
The paper also looks at the JPMorgan Chase-led Interbank Information Network, a blockchain-based platform that “is quietly producing results at scale” in cross border currency transfers.
But a pilot project in Canada that hopes to use distributed ledger technology to make stock exchange transactions more efficient “suggests that these potential benefits [from the technology] will take time to realize.”
Citigroup is looking for more office space in Paris rather than Frankfurt as it plans to move more of its London staff after Brexit. “The bank is now likely to transfer fewer jobs to the German city, which it has picked as Citi’s main trading hub following the U.K.’s planned departure from the EU.”
Rabobank is exploring the sale of part of Rabobank N.A., its California-based retail and wealth management unit. The deal could eclipse $1 billion.
“Your ill-advised commentary goes beyond holding the Fed accountable. You appear to be telling the Fed what to do with interest rates, which we believe is unconstructive and dangerous.” — Sens. Chris Coons, D-Del., and Jeff Flake, R-Ariz., in a letter to President Trump, asking him to stop publicly criticizing the central bank.