Search Results for: "money laundering"

When I look at the news about Wells Fargo over the last few months, it is amazing to see the number of individual messes the bank has and the amount of time it is taking to get past the issues. Also odd is that new issues are surfacing every month or two. Here are a few articles that I notices in the last month:

8/15/17 – Emily Glazer at Wall Street Journal – Wells Fargo Elevates Former Fed Governor Elizabeth Duke to Chairman Role – As was previously expected (and reported by Ms. Glazer), the bank will replace its current board chair with the former Federal Reserve governor.  This is not as big a deal as it would otherwise seem. The current board chair would have hit the bank’s mandatory retirement age four months later anyway.

8/18 – Reuters – Wells Fargo troubles shift from phony bank accounts to real ones – The bank disclosed yet another problem in regulatory filings, explaining the Consumer Financial Protection Bureau is looking at the bank improperly closing real accounts.

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Wells Fargo staying in the headlines.Read More »

A few articles that have caught my eye on varied aspects of the overall range of banking fiascos in play:

4/14 – New York Times – How Regulators Mess With Bankers’ Minds, and Why That’s Good – News the previous week was that many of the huge banks failed their ‘living will’ test. Each bank that is labeled as having ‘systemic risk’ must submit for approval a plan on how they would wind down in the event of failure. The purpose is to show they would not take down the entire financial system.

This article points out the banks were not told what their living will should contain or what it should look like.

As an expected result, likely intentional, the banks’ plans failed the test. When you don’t know how the test will be scored, or even what will be on the test, you are unlikely to pass. Sort of like having to turn in a term paper without know what topic the professor will select.

Again, this article thinks it is wonderful that the banks are evaluated on criteria that are not disclosed to them.

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Updates on banking fiascosRead More »

Previously discussed Barclays drawing a £72M (US$109M) fine for breaking British anti-money laundering laws and calculating the fine is equal to about six workdays worth of net income before costs of settlements.

While calculating magnitude of costs from this settlement, I noticed the income statement shows there have been huge reserves set up for settlements.

Fines and legal fees in last 4 years

The fines and legal fees over the last four years for all of the fiascos the bank has engaged in are a large portion of net income.

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Barclays’ cost of dealing with fiascos is close to half of pre-settlement income over last 5 yearsRead More »