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• Four UK Banks Breached Competition Rules, Says Regulator
• CFPB Warns Against Intimidation Of Whistleblowers
• FCA Imposes New Rules On Bank Branch Closures In Cash-Poor Areas
• Italy's FIU Reports Decline In Suspicious Transaction Reports In H1 2024
• All Payment Systems Functioned Normally During Microsoft Outage, Says Singapore
• ANZ Settles First Cross-Border Transaction Using Real-Time Payments Platform
• Bank Of Lithuania Issues Warning To EMI Over Sanctions Compliance
• India's Financial Sector Mostly Unaffected By Microsoft Outage, Says RBI
• CFPB Proposes Rule To Clarify Fees For Paycheck Advance Products
• Standard Chartered Named Among Prospective Hong Kong Stablecoin Issuers

Four UK Banks Breached Competition Rules, Says Regulator

HSBC, Lloyds, TSB and Allied Irish Bank (AIB) have violated Competition and Markets Authority (CMA) regulations designed to enhance transparency in retail banking, the regulator has . 

According to the CMA, the banks failed to provide accurate information about their products, including branch locations, interest rates and overdraft charges. 

HSBC was cited for listing closed branches as open and providing incorrect loan rates and overdraft charges, while Lloyds, TSB and AIB were cited for issues including outdated ATM addresses and inaccurate loan rates.

The CMA has said that Lloyds, TSB and AIB are taking steps to rectify their breaches, and HSBC has been ordered to implement additional measures.

Dan Turnbull, senior director at the CMA, said consumers need trustworthy banks and accurate information to make sound financial decisions. 

"It’s disappointing that seven years on, we have to put in place formal enforcement measures to secure better compliance from a major bank like HSBC which, yet again, is in breach of the rules," he said. 

"The CMA will continue to closely monitor all banks’ compliance to ensure customers can clearly and confidently manage their finances."

CFPB Warns Against Intimidation Of Whistleblowers

The US Consumer Financial Protection Bureau (CFPB) has  a circular to regulators and law enforcement explaining how companies may be breaking the law by requiring employees to sign broad non-disclosure agreements (NDAs).

According to the CFPB, “sweeping” NDAs that do not clearly permit communication with law enforcement may intimidate employees from disclosing misconduct or cooperating with investigations.

The agency is concerned that these NDAs can impede investigations and potentially violate federal whistleblower protections.

"The law enforcement community uncovers serious wrongdoing by financial firms through whistleblower tips,” said CFPB director Rohit Chopra.

"Companies should not censor or muzzle employees through nondisclosure agreements that deter whistleblowers from coming forward to law enforcement."

FCA Imposes New Rules On Bank Branch Closures In Cash-Poor Areas

The UK’s Financial Conduct Authority (FCA) has  that new restrictions on bank branch closures in certain areas will come into effect on September 18, 2024.

Under the new rules, banks and building societies will need to assess whether local communities have sufficient access to cash services before proceeding with branch closures.

Where additional services are needed, branch closures will need to be put on hold until these services are in place.

Sheldon Mills, executive director of consumers and competition at the FCA, said 3m people continue to rely on cash, and many small businesses still need somewhere to safely deposit their takings.

“That’s why we’ve acted quickly in response to new powers given to us by parliament to ensure reasonable access to cash withdrawal and deposits is maintained,” he said.

All Payment Systems Functioned Normally During Microsoft Outage, Says Singapore

The Monetary Authority of Singapore (MAS) has  that all of its payment systems managed to stay online during last week’s global cyber outage.

This includes the MAS Electronic Payment System (MEPS+), the real-time gross settlement system for Singapore dollar (SDG) payments.

In addition, the SDG money market and foreign exchange market functioned normally during the outage.

In response to a request for information from the MAS, Singapore financial institutions reported “no or limited impact” on customers and key operations during the outage.

“Some experienced disruptions to internal-facing systems used by staff, but in all cases, critical systems were unaffected,” said the MAS.

ANZ Settles First Cross-Border Transaction Using Real-Time Payments Platform

ANZ has become the first Australian bank to settle a cross-border transaction using the country’s real-time payments system.

Earlier this month, the bank  that it had successfully settled a cross-border transaction for BNP Paribas using Express Payments, a solution that leverages Australia’s New Payments Platform (NPP).

To execute the transaction, BNP Paribas sent an international payment to ANZ via Swift. ANZ was able to process the payment and clear it into the NPP network, allowing the beneficiary to receive it in near real time.

Lisa Vasic, managing director for transaction banking at ANZ, said the new solution is a “game changer” for both individuals and businesses.

“It will significantly improve the customer experience by reducing wait times, improving cash flow and increasing operational efficiency,” she said.

“We’re particularly pleased that the infrastructure was built using in-house capability without relying on third-party solutions.”

Bank Of Lithuania Issues Warning To EMI Over Sanctions Compliance

The Bank of Lithuania has  a warning to IBS Lithuania after determining that the e-money institution (EMI) has failed to comply with international sanctions and client identification requirements.

During the audited period, the central bank found that IBS Lithuania's internal policies and control procedures lacked sufficient quality assurance and testing measures for the implementation of international sanctions and restrictive measures. 

This resulted in inadequate application of these measures in practice. In addition, deficiencies were found in the institution's IT system, customer information verification processes and the identification of customer representatives.

Despite these issues, the Bank of Lithuania has acknowledged that all identified deficiencies have since been addressed, with some rectified prior to the inspection.

Considering these remedial actions and other circumstances, the bank decided to issue a warning to the company, rather than a more punitive measure.

India's Financial Sector Mostly Unaffected By Microsoft Outage, Says RBI

The Reserve Bank of India (RBI) has  a statement on last week’s Microsoft outage following an assessment of its impact on the financial services sector.

The central bank said there were “minor disruptions” at ten banks and non-bank financial companies (NBFCs), all of which have either been resolved or are in the process of being resolved.

“Critical systems of most banks are not in the cloud, and only a few banks are using the CrowdStrike tool,” said the RBI, referring to Falcon Sensor, the tool whose failed update led to the outage.

“Overall, the Indian financial sector in the Reserve Bank’s domain remains insulated from the global outage.”

CFPB Proposes Rule To Clarify Fees For Paycheck Advance Products

The US Consumer Financial Protection Bureau (CFPB) has  a new interpretive rule which confirms that many paycheck advance products are consumer loans and are therefore subject to the Truth in Lending Act.

This guidance aims to ensure that paycheck advance lenders disclose the costs and fees associated with these credit products to borrowers.

A newly published CFPB report highlights that workers using employer-sponsored paycheck advance loans take out an average of 27 such loans annually, with typical loans carrying an annual percentage rate (APR) exceeding 100 percent.

"Paycheck advance products are often marketed to and designed for employers, rather than employees," said CFPB director Rohit Chopra.

"The CFPB's actions will help workers know what they are getting with these products and prevent race-to-the-bottom business practices."

Standard Chartered Named Among Prospective Hong Kong Stablecoin Issuers

The Hong Kong Monetary Authority (HKMA) has  Standard Chartered among three groups of participants in the first phase of its stablecoin issuer sandbox.

The sandbox, which was announced in March 2024, is part of the regulator's efforts to develop a “sustainable” and “responsible” ecosystem for stablecoin issuance.

Through the sandbox, the HKMA will allow institutions with plans to issue stablecoins in Hong Kong to conduct testing on their operational plans and risk management procedures.

Standard Chartered will partner with Animoca Brands and Hong Kong Telecommunications (HKT) on the sandbox, while RD InnoTech and JINGDONG Coinlink Technology will run separate operations.

The move follows the HKMA’s publication of a consultation response which sets out the likely provisions in the territory’s first bill to regulate stablecoin issuance.

The bill will be introduced to the legislature later this year and the HKMA will also publish licensing and supervisory guidelines.

Italy's FIU Reports Decline In Suspicious Transaction Reports In H1 2024

As in 2023, Italy’s financial regulator continues to see a downturn in suspicious transaction reports (STRs).

In the first half of 2024, the Financial Intelligence Unit (UIF)  a 9.7 percent drop in STRs compared with the same period in 2023.

The decline in low-risk alerts was even more pronounced, with STRs rated low and medium-low risk falling by more than 29 percent. This reduction may be linked to efforts to improve reporting quality, including meetings with top whistleblowers in January and June.

The banking and post office sectors, along with intermediaries and financial operators, significantly contributed to the decrease, with 4,364 and 4,692 fewer STRs respectively. Notable drops were also seen in payment institutions (-25.4 percent) and e-money institutions (-19.7 percent).

In contrast, non-financial entities increased their reporting by 1,534 STRs. Reports from professionals, mainly notaries and the National Council of Notaries (CNN), rose by 45.9 percent, and submissions from virtual currency operators more than doubled.