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New direction: The Consumer Financial Protection Bureau effectively fired all 25 members of its Consumer Advisory Board during a conference call Wednesday. The bureau plans to “reconstitute the current advisory groups with new, smaller memberships,” a memo sent to group members said. “Smaller memberships will ensure streamlined discussions about the bureau’s policy priorities and needs in a productive manner.”

The bureau said it plans to “increase its strategic outreach to encourage intimate conversations, sharing information, and developing partnerships focused on consumers in underserved communities and geographies.”

Acting CFPB Director Mick Mulvaney
Acting CFPB Director Mick Mulvaney Bloomberg News

“We suspected this might be coming,” said board member Josh Zinner, CEO of the Interfaith Center on Corporate Responsibility. “This is a further signaling that the new leadership is almost obsessively dismantling the bureau’s accomplishments and taking it in a decidedly different, industry-friendly direction.” Wall Street Journal, New York Times, Washington Post, American Banker

Wall Street Journal


Job wars: More M.B.A. graduates are eschewing the financial sector for jobs in technology and consulting. The percentage of full-time M.B.A. graduates from the top 10 business schools accepting jobs at banks fell to 26% last year from 36% five years earlier, while tech’s share rose to 20% from 13% and those choosing careers in consulting rose to 29% from 27%. Banks are responding by raising starting salaries while some are trying to make the industry more attractive.

Vote set: The Senate Banking Committee is scheduled to vote next Tuesday on the nominations of Richard Clarida as vice chair of the Federal Reserve and Michelle Bowman for the position reserved for a community banker or regulator. Both are expected to be approved. The nominations would then go to the full Senate for confirmation.

Settled: Credit Suisse said it will pay about $47 million to settle a U.S. Justice Department investigation into whether it bribed officials in Asia in exchange for investment banking business or regulatory approvals.

Next phase: Coinbase, one of the biggest cryptocurrency trading firms, is acquiring Keystone Capital, a registered broker-dealer and investment adviser. “Those licenses could open up new business opportunities and allow it to market its services to more institutional businesses. Buying Keystone also raises the prospect that Coinbase could, down the line, expand into products tied to stocks or other securities.”

Van Eck Associates Corp. and SolidX Management LLC, each of which tried unsuccessfully to launch bitcoin-based exchange traded funds last year, are teaming up to try again. The ETF, the VanEck SolidX Bitcoin Trust, will have a minimum investment of $200,000 in order to target institutional investors, hoping to placate Securities and Exchange Commission concerns that such funds may not be suitable for consumers.

Financial Times


The battle escalates: Goldman Sachs has become the first bank to sign up with Immersive Labs, a U.K-based company “that offers continuously-evolving learning tests and war games on cyber threats.” The bank’s 8,000 technology employees will be able to “test their skills against colleagues and compete on a company-wide league table” in “cyber security war games” to make sure they are “up to speed on the hacks and viruses that could delete bank data, compromise privacy or otherwise threaten vital operations.”

Speaking of cyberattacks, a U.K. parliamentary committee heard evidence into TSB’s botched accounts transfer in April that showed the bank’s customers “suffered waves of aggressive fraud attacks following a systems outage that led to hundreds of thousands locked out of accounts.” The bank, which is owned by Sabadell of Spain, faced “70 times the normal level of fraud attacks,” CEO Paul Pester told the committee.

Getting tough: Responding to public anger about the recent spate of banking scandals, the Australian government is “getting tough on the financial sector. Measures taken include introducing tough new accountability rules for board directors and executives of banks and increasing the penalties for bad behavior.”

Quotable


“We've decided we're going to start the advisory groups with new membership, to bring in these new perspectives and new dialogue. We want more diverse voices and we want to bring people in from larger-scale organizations, larger-scale opportunities in the communities to hear about processes we may be going through.” — Anthony Welcher, the CFPB’s policy associate director for external affairs.

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