Receiving Wide Coverage ...
The mother of all hacks: “In one of the biggest and most threatening data breaches of recent years,” in the words of the Wall Street Journal, hackers gained access to some of Equifax’s data systems, potentially compromising the personal records of 143 million Americans.
“The Equifax breach could prove especially damaging given the gateway role credit-reporting companies play in helping to determine which consumers gain access to financing,” the paper notes. What’s more, the hackers gained access “in one swoop” to four of the most important pieces of consumers’ information — names, Social Security numbers, birth dates and addresses — that could make it easier to commit fraud. Wall Street Journal, Financial Times here and here, New York Times, Washington Post, American Banker
Settled: State Street agreed to pay $35 million to settle claims by the Securities and Exchange Commission that it overcharged customers “using secret markups and failed to fully inform other clients about how its platform for trading Treasury securities worked.” The SEC said the scheme generated $20 million in improper revenue for the bank. Two former State Street executives were indicted last year on related criminal charges. Wall Street Journal, Financial Times
Yer out!: The New York Department of Financial Services fined Habib Bank, Pakistan’s largest bank, $225 million and ordered it out of the U.S. for “opening the door” to terror financing. It was the first time the agency has kicked a bank out of the country. According to the Journal, the bank “facilitated billions of dollars in transactions with a Saudi private bank, the Al Rajhi Bank, which has had reported links to al-Qaeda.” It also used a “good guy” list — which included a Pakistani terrorist, an international arms dealer, and Saddam Hussein’s former deputy prime minister — whose transactions were waved through with no oversight. Wall Street Journal, Financial Times
Moving out: Nordea, the only bank in Scandinavia on the global list of systemically important financial institutions, is switching its headquarters from Sweden to Finland, a eurozone member, to take advantage of a lower tax rate and access to free excess capital. The move is “a snub to Stefan Ingves, governor of Sweden’s central bank, who as chair of the Basel Committee has been pushing the attempt to reduce differences between the capital required for similar risks in different countries.” Wall Street Journal, New York Times
Wall Street Journal
Unhappy anniversary: For Wells Fargo, it’s been a year of scandal — and it is far from over. “Executives still face an array of legal challenges that may take months if not years to sort out,” the paper says.
Moving along: The Senate Banking Committee approved the nominations of two Trump administration picks: Randal Quarles as Federal Reserve vice chairman for banking supervision and Joseph Otting as Comptroller of the Currency. Quarles was approved by a 17-6 vote while Otting was approved 13-10, with just one Democrat voting in favor. “The Democratic opposition suggests that both nominees will likely endure lengthy floor proceedings before passing through the Senate,” the paper says.
New CIO at JPM: JPMorgan Chase named Lori Beer as its global chief information officer, effective immediately. Beer was CIO of JPM’s corporate and investment banking unit. She succeeds Dana Deasy, who is retiring but plans to join the boards of some fintech companies that JPM has partnered with or invested in.
Hired: Charlotte Hogg, a former deputy governor of the Bank of England, has been appointed CEO of Visa Europe. Hogg, who was chief operating officer at the BoE since 2013, was forced to step down after a month as deputy governor at the central bank “after she failed for nearly four years to officially disclose that her brother was a senior banker at Barclays,” the paper reports.
New York Times
It's more than a label: Following up on a recent story that the Trump administration is moving closer to limiting how often big financial institutions are called "systemically important," the paper's editorial board claims the White House "opposes tough federal supervision and regulation." Weakening regulation will benefit bankers and traders, the paper says, while "[f]or everyone else, heightened risk means greater economic peril, including threatened destruction of jobs, pay, savings, home equity and career opportunity."
“This is the nightmare scenario — all four pieces of information in one place.” — John Ulzheimer, a former manager at Equifax, referring to customers’ names, Social Security numbers, birth dates and addresses that hackers accessed from Equifax’s computers.