Banking & Finance

Regulators warn about fraudsters creating synthetic borrowers
Information cobbled together from multiple people used to make fake identities, establish credit

The Federal Reserve has issued warnings about synthetic identity fraud and is expected to release a report in early 2020 outlining ways that financial companies can mitigate the problem. (Caroline Brehman/CQ Roll Call file photo)

The financial technology industry that’s upending consumer finance could be the solution to a kind of identity fraud that’s dogging traditional banks and fintech companies alike.

It’s called synthetic identity fraud, where instead of stealing one person’s information, criminals synthesize a false identity using information from many people — usually those unlikely to monitor their credit, like children, the elderly, prisoners or the homeless. Fraudsters then establish a credit history for the fake person over time until they can trick banks or financial technology companies into lending them money.

The Transfer Agent
Fintech Beat, Ep. 31

Public blockchains such as those that underpin cryptocurrencies like bitcoin are most at risk because anyone can participate. (Dan Kitwood/Getty Images file photo)

Big data poses big problems for banks, experts say
Risks to security and privacy cited as products and services develop rapidly

Minnesota Rep. Tom Emmer says big data systems generate “astounding” amounts of data. “This is the future, and there’s no going back from here,” he said at a Nov. 21 hearing. (Bill Clark/CQ Roll Call file photo)

The financial services industry’s use of big data and data aggregation tools has the potential to benefit millions of consumers but also could disproportionately affect the privacy and security of vulnerable populations.

That’s the take of experts who testified to the House Financial Services Committee’s Task Force on Financial Technology last month, hoping to convince lawmakers that more attention is needed on the issue.

Banks see Fed payments proposal opening door to fintech rivals
Banking industry pushes for tight rules on companies moving into banking-like services

Prompted by the Federal Reserve’s plan to build an instant payment system, banks are pushing for tight rules on tech firms moving into banking-like services. (iStock)

A plan by the Federal Reserve to build its own network to transfer funds quickly has pitted technology firms seeking a foothold in the financial sector against banks that have traditionally dominated the payments business. 

Tech firms see the new payment system as an opportunity to get into the payments business, and banks, facing a new rival, are pushing for tight rules on companies moving into banking-like services, according to advocates on both sides of the issue.

Road ahead: Public impeachment hearings begin
Senate set to confirm new Homeland Security secretary

The first open impeachment hearings in over 20 years begin on Wednesday. (Bill Clark/CQ Roll Call file photo)

The public phase of the House impeachment inquiry begins this week, with three witnesses set to air concerns Wednesday and Friday that President Donald Trump attempted to tie Ukrainian military aid to an investigation of former Vice President Joe Biden, a potential Democratic rival in 2020.

Much of the attention on Capitol Hill will be focused on the House Intelligence Committee as it opens up to televised questioning and testimony an investigation that so far had been conducted in a secure closed-door facility in the basement of the Capitol.

Fintech Beat explains how open banking is poised to revolutionize financial services
Open Banking 101, Ep. 28

Open banking is shaking up financial experiences for customers across the globe (iStock).

Open banking is set to shake up financial experiences for customers across the globe, enabling customers to allow third parties to access financial information needed to develop new apps and services. Fintech Beat sits down with the head of policy at Plaid, a unicorn fintech sitting in the middle of the revolution, to discuss the process of information sharing and how regulation shapes it.

House to take up CR, Export-Import Bank and voting rights legislation in November
Hoyer outlines floor schedule for November, says action on prescription drug bill delayed to December

House Majority Leader Steny Hoyer, D-Md., said Friday he’s hopeful “that we can finish our work and fully fund the government before the end of the year.” (Tom Williams/CQ Roll Call file photo)

The House will take up a stopgap funding bill, legislation to reauthorize the Export-Import Bank, and a voting rights measure in November, House Majority Leader Steny Hoyer said in a “Dear Colleague” letter Friday.

The House has been on recess this week and will return Tuesday after the Veterans Day holiday for two consecutive weeks of legislative sessions before recessing again for the week of Thanksgiving. 

Fintech Beat and FRT team up to cover all things fintech in DC
Fintech Beat, Ep. 27

An attendee at Fintech Week 2019 asks a question during a panel. (Photo by CQ Roll Call)

Brad Garlinghouse speaks to Fintech Beat about all things crypto
Fintech Beat, Ep. 25

Brad Garlinghouse (left), CEO of Ripple, sits with Chris Brummer, co-founder of Fintech Beat, at last week's Fintech Week. (Photo by CQ Roll Call)

 

Brad Garlinghouse, CEO of Ripple, sits down with Fintech Beat's Chris Brummer about the state of his company, XRP, Facebook's Libra, Cryptocurrency, and the vast universe of the regulatory unknown.