Receiving Wide Coverage ...
Chinese Connections: U.S. officials' investigation of potential violation of antibribery laws is reaching to some of the highest levels of the Chinese government. Two agencies, the Securities and Exchange Commission and the Justice Department, have subpoenaed JPMorgan Chase for information about Wang Qishan, one of seven members of the Chinese politburo that rules the country, the Wall Street Journal and Financial Times reported, citing a copy of the April 29 subpoena and unnamed sources. The U.S. has already uncovered proof that Chinese officials have lobbied JPMorgan to give jobs to their relatives and friends, and they're looking for more proof. Wang is also the official who's heading China's anticorruption program. It's illegal for U.S. companies to bribe foreign officials in exchange for business. It's not clear how JPMorgan has responded to the SEC's subpoena. JPMorgan has thus far declined to comment. Other banks are also under investigation for hiring practices in China, including Citigroup, Goldman Sachs, Morgan Stanley and Bank of New York Mellon. Those banks have resisted a pan-bank settlement, saying what they've done is less egregious than what JPMorgan has done. Wall Street Journal, Financial Times
Prepaid Card Fraud: A consumer whose identity was stolen in the Internal Revenue Service data breach has complained that the prepaid-card purveyor Green Dot is partly at fault. The consumer, Palm City, Fla., tire salesman Rick Yost, received an unsolicited Green Dot debit card in the mail earlier this year. After investigating why he received the card, Yost learned a thief obtained his ID through the IRS and stole his $9,856 tax refund. The thief opened a Green Dot account and withdrew Yost's tax refund from it as soon as it posted. Yost complained to the IRS that Green Dot failed to verify personal information before opening the account for the thief. Reusable, prepaid cards have become a popular way for thieves to steal identities and money, as it allows them to pose as bill collectors or government agents. The IRS responded to the Journal that it's been trying to help consumers whose identities were swiped and thus far has assisted about 875,000 victims, including folks like Yost. Green Dot responded in a statement that it "detected suspicious activity and blocked the account for further verification the fraudster never gained access to the funds." That's all well and good, but Yost had to file separate legal affidavits with the IRS and with other agencies, as well as contact credit bureaus and file his 2014 tax return on paper in order to get his refund. Oh by the way, he'll also have to wait an additional six months before he'll receive the refund. Wall Street Journal, New York Times
Wall Street Journal
Earnings rebounded in the first quarter and commercial lending was one of the strongest areas, according to the Federal Deposit Insurance Corp.'s Quarterly Banking Profile, released Wednesday. Commercial-and-industrial loans rose 8.5% from a year earlier, and represented 21% of all outstanding loan balances. That's the highest level in 13 years and puts C&I loans on pace to overtake mortgage loans for the first time since 1988. The uptick in C&I lending means that manufacturers and retailers are boosting their borrowing ahead of the likely rise in interest rates. The rise in C&I lending may also mean companies are borrowing to pay for expansion. Banks have responded by hiring more people. Bank of America's commercial bank has increased staffing by 4% from a year ago, and will likely rise by 15% by the end of the year, Brian Moynihan said at a conference on Wednesday.
Commercial lending may be where the party's at, but the atmosphere at the trading desk down the hallway feels more like a morgue. Trading activity at large banks is likely to be down in the second quarter, based on remarks by Moynihan and JPMorgan Chase CEO Jamie Dimon at Wednesday's Bernstein Research conference. B of A may need to cut its trader workforce to deal with the weakness, Moynihan said.
At the same conference, Dimon admitted that the multibillion-dollar settlement reached by his bank and others with investigators over alleged foreign-exchange rigging will likely cost JPMorgan some business.
The paper identified some of the banks named in the complaint filed by the U.S. against officials and executives of FIFA, the global soccer governing body. The banks were used as conduits for the bribes paid to FIFA officials. Banks named in the complaint include JPMorgan Chase, Citigroup, HSBC, Bank of America, UBS, Julius Baer, Banco do Brasil and Delta National Bank & Trust in New York. The U.S. Justice Department is investigating whether these banks were aware they were being used in to launder bribe money.
New York Times
Google is set to unveil its new Android Pay product Thursday at an industry conference. Android Pay will allow developers to build payments into applications and is seen as Google's answer to Apple Pay. A revamped Google Wallet will also be introduced as a marketplace-lending platform that lets consumers send money to each other directly from a debit account. Meanwhile, Apple will roll out enhancements to Apple Pay next month and the improvements are expected to include a merchant-rewards program.
Charlotte Observer: A corporate trainer for Wells Fargo in Charlotte has introduced a mobile personal-finance hub in a retrofitted school bus. The Finance Bar, as Marsha Barnes calls it, travels around the city to give help and advice to people on budgeting and savings strategies. Barnes said she's not a financial adviser, but rather a personal finance consultant who helps people with basic financial needs. Her sessions range in price from $30 to $55. The bus idea was inspired by the food-truck craze, she said.