Receiving Wide Coverage ...

The Russian Hacker Mob: Russian-speaking gangs of hackers have stolen millions of dollars since 2013 from banks in the U.S., Eastern Europe and Russia and according to the Russian computer-security firm Kaspersky Lab, the Wall Street Journal reported. The Financial Times' report on the same study said the thieves' total haul may be closer to $1 billion. Most alarming is the lab's claim the cyberattack is still active. The Kaspersky Lab issued the study with the backing of Interpol, Europol and other groups investigating the attack. No U.S. bank was named in the report and the Financial Services Roundtable questioned whether American banks lost much. The Financial Services Roundtable is "unaware of incidences where this malware has harmed our member companies or their customers," the group said. But the Kaspersky report provides details that strongly suggest the Russian-speaking criminal syndicate, called Carbanak, has been behind some recent spear-phishing attacks in which corrupt emails are used to unleash malware on a company's system. The report contains one detail that sounds like it comes straight out of Hollywood action movie: the Russian hackers apparently used computer code to transmit instructions to specific ATMs to start dispensing cash at a designated time, and an agent of the criminals waited at the ATM to collect the bounty. The New York Times reported on the Lab's findings from a different perspective: U.S. intelligence agencies, including the National Security Agency and the U.S. Cyber Command, have embedded spyware and other surveillance tools in computer networks in Iran, Russia, Pakistan and China.

Wall Street Journal

Losing their patience? Cleveland Fed President Loretta Mester has suggested she wants to drop the word "patient" to describe the Fed's actions toward raising short-term interest rates. Mester's suggestion joins other Fed officials in setting the stage for a rate hike in June. "I want June to be a viable option," Mester said in an interview with the Journal. Others who appear to be leaning in Mester's direction are Atlanta Fed President Dennis Lockhart, San Francisco Fed President John Williams, Richmond Fed President Jeffrey Lacker, St. Louis Fed President James Bullard and Fed Governor Jerome Powell.

Clawback rules may be coming for Wall Street executive pay, as regulators try to cut pay plans that "encourage excessive risk taking." Shareholder groups bemoan "weak" clawback policies and banks' failure to "disclose when the tool is used." While the New York City comptroller has pushed banks to expand clawback policies, "many big banks have resisted the office’s efforts to have them routinely disclose when and how much compensation they claw back." Some banks have voluntarily recouped pay from employees who engaged in reckless conduct and took on excessive risk; JPMorgan Chase, for example, clawed back a total of two years' worth of compensation from three traders involved in the London whale fiasco. Any expansion of Dodd-Frank to add clawback language would, of course, need to be hashed out by an army of regulators, including but not limited to the Federal Reserve, the Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. and the Securities and Exchange Commission.

New York Times

Ever since Fannie Mae and Freddie Mac repaid U.S. taxpayers after their $187.5 billion bailout, the Federal Housing Finance Agency has swept all of the GSEs' profits into the U.S. Treasury Department. A private shareholder has sued to reverse that move, saying it's an improper taking of its property. What's particularly troubling is that, in the litigation battle, the government has asserted "presidential privilege to prevent 45 documents from being produced," writes Times columnist Gretchen Morgenson. It raises the question of what the government is trying to hide. "It is disturbing that the government goes to such lengths to shroud the details of the profit-sweep decision," Morgenson said.

Elsewhere ...

Reuters: The former chief operating officer of United Commercial Bank goes on trial starting today in San Francisco, in a criminal case in which he is accused of concealing the bank's losses. The bank received $299 million from the Troubled Asset Relief Program. East West Bank acquired United Commercial Bank after it failed.

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