From the margin to the mainstream?: One of the Goldman Sachs executives overseeing the creation of its new bitcoin trading operation is Rana Yared, who said the initiative is in response to customer demand. “I would not describe myself as a true believer who wakes up thinking bitcoin will take over the world. For almost every person involved, there has been personal skepticism brought to the table,” said Yared. But, “it resonates with us when a client says, ‘I want to hold bitcoin or bitcoin futures because I think it is an alternate store of value.’” Justin Schmidt, who joined Goldman just a few weeks ago, will run the operation with Marianna Lopert-Schaye, vice president of principal strategic investments, and Neema Raphael, who will lead research and development. This move by a Wall Street titan like Goldman is significant for bitcoin, given the industrywide leeriness of cryptocurrencies. “It is not a new risk that we don’t understand,” Yared said. “It is just a heightened risk that we need to be extra aware of here.”
Patience please: Meanwhile, JPMorgan Chase recently completed yet another industry trial proving that distributed ledger technology can handle financial instruments of all kinds — this one was the issuance of a $150 million, one-year, floating-rate Yankee certificate of deposit on its homegrown blockchain, Quorum. The industry sees many blockchain proofs of concept and few projects actually in production and at scale. But Christine Moy, program lead for JPMorgan Chase’s Blockchain Center of Excellence, said that’s because building technology takes time and banks need to exercise caution with it. “If you think about it from the perspective of a global bank with a large number of clients, being a highly regulated entity, working in systemically important financial markets and having a reputation to uphold, we have to be extremely responsible and careful about the technology we build, making sure that it’s enterprise grade, safe, secure, cybersecurity tested and resilient,” Moy said. “All of that takes time.”
Going after Goldman: After a 13-year fight with Goldman Sachs, Cristina Chen-Oster, a former vice president at the firm, just got the green light for a class action that could be one of the biggest gender lawsuits on Wall Street. Chen-Oster, who maintains that there is systematic gender discrimination at Goldman, said that, while keeping quiet about a colleague’s unwanted sexual advance in 1996, she had her best accounts transferred to male colleagues, and also witnessed the men getting outsized, unfair payouts. In 1999, when she reported the incident to her boss, she realized his inclination to report it to human resources was “a formality, not justice” and she declined to provide HR with further details. A previous judge, who has since died, ruled that Chen-Oster and her co-plaintiffs – former Goldman employees Lisa Parisi, a managing director, and Shanna Orlich, an associate – couldn’t force the investment bank to change its current practices because they no longer worked there. Chen-Oster has since added Allison Gamba, a current Goldman trader, and Mary De Luis, a vice president who worked in the investment management division, to her complaint. Now, a new judge, Analisa Torres, who took over the case in 2013, has found that the women can hold Goldman accountable, even as former employees. “It sounds like a perfect #MeToo triumph,” Bloomberg writes. “But after 13 years, dozens of lawyers, and more than 580 docket entries, winning class-action status is just the end of the beginning.”
Two sides to the story: Omeed Malik, the Bank of America executive who got fired following allegations of sexual misconduct, is seeking $100 million from the bank in a defamation claim he filed with the Financial Industry Regulatory Authority. BofA “threatened the employment and livelihood of other employees … if they did not admit to inappropriate conduct on Mr. Malik’s part, which these employees courageously refused to do,” said Malik’s lawyer. BofA said that it stands by the decision to terminate Malik and that his claims are without merit.
Working through the pain (points): Citigroup is planning to release a newly redesigned mobile banking app that even noncustomers can use, according to Alice Milligan, the chief digital client experience officer for the company’s U.S. consumer bank unit. In what could become part of a customer acquisition strategy, Citi will allow anyone to link their outside accounts to its app so that they can make use of the personal financial management tools, similar to Mint. The goal of the redesign is helping consumers take better control of their finances and removing pain points, Milligan said. “We all talk about digital wallets, e-commerce, mobile payments, Zelle and all these other things, but from a consumer standpoint, there’s still a lot of confusion on what these things are, which ones they should be using and where they’re available,” she said, adding that merchant acceptance is critical for adoption and engagement. Part of Citi’s strategy with consumers is to use well-timed push notifications to be more helpful, reminding them of benefits like the fact that they won’t be charged foreign exchange fees on card transactions when traveling internationally. “When you’re going to remember something is if it comes to you when you need it so you use it. If we can time the communication of that with when the need is, people will remember.”
Dealmaker: Online small-business lender Kabbage has agreed to acquire Orchard as part of a plan to offer borrowers new payment processing services and give banks better insight into loans made through the platform. “There are three core things our customers care about: having access to capital, managing their day-to-day capital, accepting and making payments,” Kathryn Petralia, president and co-founder of Kabbage, said of small-business borrowers. “Our goal is to expand on the products and services we offer to allow us to do all of that in one place and allow them to focus on growing their business, not on managing cash flow.” Petralia also said she sees Kabbage’s partner banks making more use of Orchard’s technology to analyze the loan portfolios they fund through Kabbage.
Role call
Fifth Third Bancorp has named Susan Zaunbrecher, a longtime corporate attorney, as its senior legal adviser. The plan is to name her chief legal officer, once Jelena McWilliams, who is currently in that role, is confirmed as the new chair of the Federal Deposit Insurance Corp., as is expected to happen soon.
AJ Murphy, Bank of America’s head of global capital markets and one of the most senior women on Wall Street, is leaving for the private equity firm Silver Lake. “The departure means that BofA has lost another of its most senior female business heads, seven months after the loss of Lisa Carnoy, another former global head of capital markets,” the Financial Times reports.
Morgan Stanley has named Clare Woodman to lead its Europe, Middle East and Africa operations. She was formerly the global chief operating officer for its institutional securities group. She replaces Rob Rooney, an American who is returning to the company’s New York headquarters as head of technology.
Bill.com, which facilitates digital payments to and from businesses, has recruited Yael Zheng to be its chief marketing officer. She was previously CMO at the enterprise cloud company Tintri, where she was instrumental in its IPO.
Beyond banking
No apologies: It’s time for women to be able to openly pursue money and power without stigma, the same way as men always have been able to do, according to a New York Times opinion piece this week by Jessica Knoll, a novelist based in Los Angeles. “Rich” is still a man’s word and one of the biggest reasons why most of the media and entertainment people consume is created by and for men, she said, citing the Geena Davis Institute on Gender in Media’s motto: “If she can see it, she can be it.” Knoll wrote about her teenage experience with sexual assault, saying that being made to “feel so worthless so young” impacted her definition of success. “I decided I could not consider myself successful unless I was somebody powerful, somebody nobody could hurt. Success became a means to wrest back control, literally to increase my value. There is a metonym for that: money.”
The queen’s back-payday: The actress Claire Foy, who portrayed the queen in the Netflix series “The Crown,” has been paid $271,886 to make up for the pay disparity between her and costar Matt Smith. Smith played Prince Philip and reportedly earned $13,600 more than Foy for each of the 20 one-hour episodes they produced.
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