In this month's roundup of top banking news, how the widespread CrowdStrike outage affected banks of all sizes, JPMorgan Chase's new tech bet for combating rising fraud, what Project 2025 could mean for bankers and more.
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How Project 2025 would affect bankers
In 2016, Trump won the presidency as a relative unknown in banking policy circles, said Ed Mills, managing director and Washington policy analyst at Raymond James.
"And the banks woke up the day after the election without knowing virtually anyone in the Trump orbit, and they didn't have a plan about what they wanted to ask for from the Trump administration," he said. "Neither Trump nor the banks are going to make the same mistake this time."
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Surge in counterfeit checks prompts outcry from small community banks
CNB's in-house fraud experts lined up the counterfeit checks — fakes that the bank had taken losses on — with real checks, side-by-side.
"We presented the checks to the board and said, 'Here's a good one, here's a bad one,' to share with them what we're up against," said Harrell, of the nine-branch, $622 million-asset bank. "It certainly served as an education for the board to see that."
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How JPMorgan Chase is fraud-proofing its branches
JPMorgan Chase is moving robust identity checks to the start of interactions inside branches by having each customer prove their identity at kiosks that ask for their account password or identification documents, rather than having a teller check the customer's driver's license by hand. That's according to Stefan Schubert, the bank's head of identity for consumer and community banking, who spoke at
The change is part of the bank's overall strategy of
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Discover settles $1.2B loose end ahead of Capital One merger
The credit card company, which disclosed the news in early July, had already set aside the money to cover the refunds it will pay under the agreement.
The settlement clears up one of the legal headaches that Capital One would have to resolve if regulators approve the merger.
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Tech issues afflict banks, Microsoft after critical CrowdStrike glitch
Australian and New Zealand banks
The problem seems to have had a mixed impact on U.S. banks, but the financial services sector had not suffered any systemic impact, according to the Financial Services Information Sharing and Analysis Center, or FS-ISAC, a consortium of roughly 5,000 financial services companies advancing cybersecurity and resilience. The consortium's members collectively have $100 trillion in assets.
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'Anti-woke' bank hit with FDIC consent order as losses mount
The Federal Deposit Insurance Corp. announced in late June that it entered the enforcement action with Old Glory Bank on May 1, calling for the Oklahoma bank to increase its capital, update its business strategy projections and implement technology audit policies.
Mike Ring, the bank's president and CEO, said that Old Glory is in "a very good spot" on making progress to address the regulator's concerns.
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Banks may see higher office loan losses than they expect: Moody's
The loan-by-loan analysis of 41 anonymous banks' commercial real estate portfolios outlines the spectrum of pain that institutions are facing. Even though Moody's found that banks' underwriting was more conservative than the ratings firm had anticipated, the higher-for-longer interest rate environment is increasing the need for banks to shore up their capital, said Stephen Lynch, vice president and senior credit officer at Moody's.
"If that continues to stay elevated, it's going to put pressure on all asset classes, Lynch said. "It made us re-assess the risk levels of these banks with higher CRE concentrations. Even if underwriting for a particular institution was good, how do you compensate for that higher asset risk?"
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CrowdStrike hints at root cause of sweeping IT outage
The
The error prevented numerous Windows users from logging into their computers, including at Fifth Third Bank. At TD Bank, digital systems were disrupted. Synovus Financial had to implement "contingency plans" to minimize disruptions to clients. All branches and bank offices of Canandaigua National Bank, a $5 billion institution in Canandaigua, New York, were affected.
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Lawmakers say banks aren't doing enough for Zelle fraud victims
Senate Democrats, in a report led by Blumenthal and in an accompanying hearing late in the afternoon on July 23, argued that banks who own and operate peer-to-peer payment network Zelle should do more to help
"While this problem affects all peer-to-peer apps, nowhere is it more problematic than on Zelle, which is the largest of them," Blumenthal said. "Sending a payment on Zelle is fast, easy and irreversible. Zelle and the big banks who own it know that its speed and convenience makes it a target, and they're well aware that every day some of their customers will be hurt."
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What banks should know about SCOTUS' 'swipe fee' ruling
The Supreme Court ruled 6-3 on July 1 that The Corner Post can sue over a 2011 Federal Reserve rule that governs "swipe fees," or the funds that businesses pay banks for debit card payments. An appeals court in St. Louis had earlier ruled The Corner Post could not sue the Fed because it missed a six-year statute of limitations. The gas station began accepting debit cards when it opened in 2018, or seven years after the 2011 rule. The ruling in effect rejected the statute of limitations.
As a result of the ruling, timing will not necessarily hinder firms that are filing a grievance, suit or some other form of legal protest against a regulation.