Receiving Wide Coverage ...
Testimony Tuesday: It will be a busy day on Capitol Hill. Former Equifax CEO Richard Smith will begin three days of testimony to various committees, starting with the House Committee on Energy and Commerce. According to his prepared opening statement, Smith will say “The breach occurred because of both human error and technology failures.” He follows that up with an appearance before the Senate Banking Committee on Wednesday and the House Financial Services Committee on Thursday. Wall Street Journal, Financial Times, American Banker here, here and here

What to watch for during the hearings? The Wall Street Journal offers these five things. The Washington Post says some lawmakers plan to use the hearings to “not only grill the embattled credit reporting agency but also to cue up a fight for tighter data security standards that they and consumer advocates have long wanted.”

Richard Smith, former chief executive officer of Equifax.
Richard Smith, former chief executive officer of Equifax. Bloomberg News

Smith won’t be the only executive feeling the heat on the Hill. Wells Fargo CEO Timothy Sloan testifies before the Senate Banking Committee, where he will “apologize for the damage done to all the people who work and bank at this important American institution,” according to his prepared remarks.

Five points to keep in mind regarding Sloan’s testimony are provided by the Journal.

Speaking of hacking: The Securities and Exchange Commission said the hackers who broke into the agency’s corporate information database also stole personal information about two people. The disclosure “contradicts” the information SEC Chairman Jay Clayton provided back on September 20, “when he said the SEC didn’t believe the intrusion allowed the intruders to access personally identifiable information.” Wall Street Journal, Washington Post

Wall Street Journal
Tax gift: Wells Fargo would be the biggest beneficiary among the big banks from the Trump administration’s proposal to lower the corporate tax rate to 20% from 35%. According to an analysis by S&P Global Market Intelligence, Wells Fargo would have earned an additional 17%, or $3.7 billion, if that rate was in effect last year, when the bank had pretax profits of $32.1 billion and paid 31% in taxes. Wells, along with Bank of America, Citigroup, JPMorgan Chase and U.S. Bancorp would have saved more than $11 billion if the lower tax rate had been in effect last year, S&P said.

Fraud, huh?: At least one big Wall Street bank doesn’t agree with Jamie Dimon that bitcoin is a fraud. The paper reports that Goldman Sachs is considering starting a trading operation for digital currencies. “Goldman’s effort is in its early stages and may not proceed,” the paper cautions. “The firm’s interest, though, could boost bitcoin’s standing among investors and fuel the debate around digital currencies, which were initially viewed as havens for illicit activity but are pushing further into the mainstream investment world.”

An American Banker BankThink piece also takes issue with Dimon's view.

Financial Times
Fees, fees, fees: ATM fee revenue at banks shows no signs of declining. According to Bankrate, the average total fee for a cash withdrawal at an out-of-network ATM hit a record $4.69 recently, up more than 50% from $3.03 in 2007. Likewise, the average ATM surcharge hit a record for the 13th year in a row, climbing to $2.97, while the average fee charged by the consumer’s own bank for using an out-of-network machine rose to a record $1.72.

Quotable
“For Equifax to say they decided not to do any notification out of fear of copycats would be like the skipper of the Titanic deciding not to sound the alarm because the ship might hit another iceberg. Steerage class is under water, the keel is split, and you don’t want to ring the bell out of fear there might be other icebergs lurking?” — Michael Farrell, co-director of the Institute for Information Security & Privacy at Georgia Tech, responding to claims by Equifax that it waited to disclose the hack because it feared “copycat” attacks.

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