By: Source - ABA Banking Journal |
Published: September 04, 2018
The ABA Foundation and the Federal Trade Commission yesterday released an infographic to help consumers recognize and understand ...
The ABA Foundation and the Federal Trade Commission yesterday released an infographic to help consumers recognize and understand the growing trend of fake check scams. This form of check fraud often involves a scammer sending a bad check to a victim and then asking for some of the funds to be returned. After the money is sent back, the scammer's original check bounces.
“Chances are you’ve been the target of a fake check scam,” said ABA Foundation Executive Director Corey Carlisle, noting that fake checks might be used in a prize scam or an online purchase. “The fraudsters are sophisticated and convincing, and while their scams may vary, there’s one constant: check fraud.” The infographic -- which banks are invited to share with their customers and on social media channels -- includes tips to prevent check fraud.
In conjunction with the release of the infographic, ABA SVP Nessa Feddis will participate in a press conference this morning hosted by the Better Business Bureau of Chicago to mark the release of a new national study on fake check scams. Feddis will be joined by representatives from the FTC and the U.S. Postal Inspection Service, along with Illinois Attorney General Lisa Madigan.
By: Ben McLannahan in New York and Barney Jopson in Washington |
Published: June 11, 2018
These are bullish times for small banks in the United States. Along with having the opportunity to exploit public anger at their ...
These are bullish times for small banks in the United States. Along with having the opportunity to exploit public anger at their largest peers, they are among the beneficiaries of the deregulatory wave in Washington.
“All’s not Wells,” read a billboard by the entrance to the Lincoln tunnel in Weehawken, New Jersey, in full view of cars and buses heading in to Manhattan.
The ad was put there by Doug Kennedy, president and chief executive of Peapack-Gladstone Bank, who wants the world to know that his $4.3bn-in-assets lender has none of the toxic, sales-obsessed culture that led to a rolling series of scandals at the $1.9tn-in-assets Wells Fargo.
These are bullish times for small banks in the US. As well the opportunity to exploit public anger at their largest peers, they are also among the beneficiaries of the deregulatory wave in Washington. President Donald Trump last month signed a new law aimed at lightening the load on thousands of small and mid-sized banks that were swept up in the crackdown on huge lenders in the wake of the financial crisis.
Shares in smaller banks have been boosted as a result, with the Russell 2000 banks index outperforming the S&P banks by about 10 percentage points since the turn of the year.
But Mr Kennedy — who went to Peapack-Gladstone after a career at banking sector goliaths Capital One, Bank of America and NatWest — says he wants to see lawmakers go further in providing more targeted relief for smaller banks like his, which has 27 branches across central New Jersey and Pennsylvania.
The new law, he says, “is a good first step: it acknowledges that community banks actually fulfil a very meaningful role in communities, and that not all banks are created equally”.
The Economic Growth, Regulatory Relief, and Consumer Protection Act contains a number of provisions related to capital, mortgage lending and data collection, mostly targeted at banks deemed too small to present a serious risk to America’s financial system. Mr Trump said it was high time to give a break to “neighbourhood banks” trying to navigate “Dodd-Frank’s brutal maze of costly regulations”.
Mr Kennedy is hardly alone in arguing Congress should not stop there. Blaine Luetkemeyer, a Republican from Missouri who chairs the House subcommittee on financial institutions and consumer credit, has promised that the House will push for further rollbacks to laws that he believes are hobbling the 5,000 or so banks which support much of the grassroots growth in the world’s largest economy.
“It’s important that we start taking some of the straw off the camel’s back, and we in the House have a lot of little bills that will [do] that,” Mr Luetkemeyer said, at a community-bank symposium last month.
The chances of further legislative concessions seem slim, for now. House conservatives were forced to ditch their hopes of giving the recent bill a more pro-bank slant, recognising that shifting it to the right would immediately jeopardise its chances of passing the Senate. This November’s midterm congressional elections could kill off any chance of further deregulation if Democrats seize control of one or both chambers.
But even without action by Congress, regulators have enough power to make life easier for banks big and small. The US’s three federal bank regulators, which are led by the Federal Reserve and boast a growing contingent of Trump appointees, are exploring ways to loosen some rules they wrote to flesh out Dodd-Frank. Bankers say they are also taking a softer approach in their day-to-day supervision.
Ed Mills, Washington-based policy analyst at Raymond James, the financial services firm, says it is already a stark change from the Fed leadership of Janet Yellen and the central bank’s former regulatory chief Daniel Tarullo. “We’re taking a big step back from where we were under Yellen and Tarullo, when the US was the leader in establishing bank rules,” he said. “Now we’ll be the leader in walking them back.”
Virginia Varela, chief executive of Golden Pacific Bank in Sacramento, hopes that the recent bill “opens the window” for further measures to lighten the load. She complains that her Sacramento-based bank — with only $125m in assets and 38 employees — is subject to a lot of the same restrictions that apply to much bigger lenders.
She has two full-time employees, for example, who are required to “act like police dogs”, monitoring transactions for possible money-laundering violations under the 1970 Bank Secrecy Act. And during the three-branch bank’s latest examination by the Office of the Comptroller of the Currency, one of the most powerful agencies in the country, 13 examiners were on site, poring over the portfolio.
“It’s a lot to handle,” says Ms Varela, a former regulator for the Federal Reserve in Washington and San Francisco. “If they applied the same scope of review to Wells Fargo or Bank of America there’d be thousands of examiners crawling all over them.”
Hundreds of community banks have pulled down the shutters in recent years, squeezed by persistently low interest rates and sluggish regional economies. Without significant relief on the regulatory front, says Ms Varela, a lot more banks her size could be forced out of business.
“It’s not like the hardware stores going away because of Home Depot,” she says. “It’s not because of a lack of customers; it’s because of the regulatory burden.”
Virginia Varela is the president and CEO of Golden Pacific Bank.
Virginia Varela has little patience for the topic of work-...
Virginia Varela is the president and CEO of Golden Pacific Bank.
Virginia Varela has little patience for the topic of work-life balance. “It makes me want to throw up,” she said.
Varela is president and CEO of Golden Pacific Bank, the area’s smallest locally based bank with $130 million in assets. She loves working hard. Then she unwinds by working some more. It’s not the concept of balancing work and home life that bugs her, it’s the assumptions that too often underlie the conversation.
“It’s always assumed that if you are a woman, you have babies and take care of the household,” she said. In her house, it’s her husband who takes care of things.
Varela takes care of banks. After a career as a bank regulator for agencies in San Francisco and Washington, D.C., she has made a second career as a turnaround artist at small local banks.
She started out with the Federal Home Loan Bank Board during the savings and loan crisis of the 1980s. She has spoken at congressional briefings, helped write the handbook for examiners across the nation, and was part of the Hurricane Katrina task force. She also did international consulting, helping Egypt, Libya and Russia with their bank examination and supervision departments.
Varela ended the regulatory part of her career at the Federal Reserve Bank in San Francisco under Janet Yellen, who’s now board chairwoman of the Federal Reserve System.
“I’ve seen management and supervision of all kinds of banks and financial institutions,” Varela said. “I had a bird’s-eye view of what seemed to work and what didn’t.”
Then Varela embarked on her second career: turning around small local banks. She’s done it in San Luis Obispo, Rio Vista and now Sacramento.
“When we realized that we had some serious problems, we knew we had to recruit a new CEO,” said Jeanne McCormack, a major shareholder and former board chairwoman at Bank of Rio Vista. Varela got the job and proceeded to reorganize the management structure, strengthen the compliance department, and put the bank’s technology on par with its competitors.
She also had to deal with the very traditional family members that owned the bank.
“This was a patriarchal family, and she was a beautiful sophisticated woman coming in and telling everyone what to do,” McCormack said. “And she fit right into this rural, unsophisticated setting.”
Sacramento is a bit larger and more sophisticated, but Varela’s work at Golden Pacific Bank involved a similar approach. After joining the bank in September 2013, she reduced the number of brances from seven to three. She cut staff. And she narrowed the bank’s focus to small-business loans and services.
“I tried to be respectful of people,” Varela said. “If you have a company that’s poorly run, you generally have morale that’s poor. If you have a successful company, you create a better job environment. My goal is to provide jobs that are meaningful and also teach people in a way that they will always be employable.”
The bank reported a loss of $1.36 million in 2014. The next year, the loss was contained to $114,000. And in 2016, the bank reported a net income of $615,000.
The staff at Golden Pacific understood the rationale behind the changes, said board vice chairman Rick Fowler, who’s also chief operating officer of law firm Kronick Moskovitz Tiedemann & Girard.
“An important part of leadership is caring about your mission and your people. And she is good at it,” Fowler said.
Although Varela is a board member of the California Bankers Association and is active with the American Bankers Association, her real enjoyment comes from approving small-business loans.
It’s a thrill, she said, to give a loan to kids with nose rings who are opening a coffee shop. “When I was a kid I really thought I would do something faith based, or a nonprofit, because I’m drawn to the spiritual side of life,” Varela said. “It’s interesting that I would find that in banking.”
Sacramento Business Journal: 2017 Women Who Mean Business with Virginia Varela
Education: B.A. in English literature, B.S. in economics, UC Santa Cruz; MBA, Monterey Institute of International Studies
Family: Lives in Sacramento with husband Malcolm Hotchkiss and four stepchildren
First job: “I worked as a receptionist and got fired because I couldn’t figure out how to use their phone.”
Advice to younger women: “Don’t be afraid to be courageous and speak your mind.”
Biggest whoops: “I either have none or too many. I think I was kind of a workaholic, but I don’t know that it’s a bad thing.”
Favorite way to unwind: “I unwind by working. I love to work. I work on the weekends. I love to read about banking. I read regulations like comic books.”
Fantasy career:“ I always wanted to be a Catholic nun. Or a social worker.”
Person you would most like to meet: Eleanor Roosevelt
Something about you that would surprise people: “I’m scared of dogs.”