Tag: banks

Federal Reserve head is questioned on controversial “debanking of disfavored individuals”

During a recent House Committee hearing, Chair of the Federal Reserve Jerome Powell was grilled on “Operation Choke Point 2.0” — an alleged Biden administration effort that Rep. Warren Davidson (R-OH) described as being “particularly focused on debanking people that are disfavored by…the current…executive branch.”

Rep. Warren Davidson (R-OH) told Powell that he’d spoken with multiple bankers who said “they’ve never seen a higher degree of regulatory burden, steering guidance, shaping activities in the market from regulators.”

He attributed this heightened scrutiny to Operation Choke Point 2.0 — a reference to an alleged extension of Operation Choke Point 1.0. The first Operation Choke Point was an Obama-era debanking effort that began in 2013 and attempted to prevent gun dealers, payday lenders, and other companies that were deemed to be “high risk” from accessing banking services. Some people in the cryptocurrency industry claim that Operation Choke Point 2.0 is now being carried out by the Biden adminsitration and is primarily focused on deterring banks from doing business with cryptocurrency firms.

“When people really feel like some third party is going to steer or shape their money, they don’t trust it,” Davidson added. “I mean the unbanked and the underbanked fundamentally that’s lack of trust is part of why they don’t use our banking system today. In fact, that’s part of the appeal of the digital asset space…the permissionless nature of it.”

Davidson continued by suggesting that lots of people working in the financial services space “feel threatened by the prospect of change” and are attempting to restrict access to services such as cryptocurrency.

“They’ve maybe reluctantly concluded that you can’t ban crypto,” Davidson said. “They at least want to keep it account based so some third party can actually control the assets which is a polite way of saying, ‘We don’t actually trust our citizens to control their money or their assets, we’ll let somebody else do it for them because we can control those third parties.’”

Davidson then pressed Powell on whether financial regulators use their powers to control third parties.

“If you don’t comply with the regulatory regime, you don’t get to operate a financial services business, right?” Davidson asked Powell.

“That’s right,” Powell confirmed.

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“Disinformation experts” blame “conspiratorial narratives,” “far-right websites,” for Silicon Valley Bank panic

Just days after a Senator was caught asking whether there were systems in place to censor social media in an attempt to prevent a bank run, “disinformation experts” are partially blaming the Silicon Valley bank collapse exacerbation on online conspiracy theorists on social media.

“Russian media outlets, far-right websites, short sellers and doomsday preppers were among those who pushed and amplified conspiracy theories online focused on the collapse of Silicon Valley Bank,” Bloomberg alleges.

According to anti-disinformation for-profit firm Alethea, a wide range of accounts used the bank’s collapse to promote their own agendas.

The firm’s founder Lisa Kaplan told Bloomberg that the claims by venture capitalists speculating the collapse of the bank that were amplified “propagandists and foreign influencers” contributed to the collapse of the bank.

“We assess that these outlets may have increased online panic and contributed to the broader cross-platform spread of false or misleading content about SVB,” Kaplan said to Bloomberg.

“We also assess that conspiratorial narratives may have accelerated panic, which then posed a risk to the broader financial system,” she said.

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Western governments are on the verge of introducing expiring money

The European Central Bank (ECB) is considering using negative interest rates, a tool that erodes the value of your money, as it introduces the digital euro — its central bank digital currency (CBDC).

This is according to Sarah Palurovic, the executive director of the Digital Euro Association (DEA) think tank.

During an appearance on the Poundcast podcast, Palurovic said that the ECB wants to “keep the possibility open for tiered remuneration” after it introduces the digital euro because the ECB wants to have “measures that incentivize or disincentivize people to hold more or less CBDCs.” She added that one of the measures the ECB is considering is negative interest rates.

Negative interest rates allow bureaucrat at central banks to choose a rate at which your money expires and punish those who save their money. For example, if they set a negative interest rate of -10%, you lose 10% of your money each year unless you spend it.

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Silicon Valley Bank Collapse: Here’s Who Benefited From Their Executive, PAC Donations

Only 15 U.S. banks were deemed “too big to fail” and subjected to rigorous stress testing after the Great Recession.

Friday’s closure of the nation’s 16th largest bank demonstrates the Biden administration feels all banks are too big to fail.

Silicon Valley Bank last week announced it would issue billions in new stock to bolster its finances. That news prompted venture capital funds to tell their startups to yank their money from SVB. A classic bank run ensued, which regulators stopped by seizing control of the bank and placing it into receivership.

Fox Business further reported:

Silicon Valley Bank, the nation’s 16th-largest bank, failed Friday after depositors hurried to withdraw money amid anxiety over the bank’s health. It was the second-biggest bank failure in United States history after the collapse of Washington Mutual in 2008.

The bank’s California executives and political action committee have propped up a handful of politicians in recent elections, which has primarily benefited Democrat lawmakers.

Greg Becker, the bank’s president and chief executive officer, cut two maximum checks totaling $5,800 to the campaigns of New York Senate Majority Leader Chuck Schumer and Virginia Sen. Mark Warner during the 2022 midterm election cycle. The two Democrat senators are the only politicians Becker financially backed directly during the most recent cycle.

Becker also gave $2,500 to the New Democrat Coalition Action Fund in May last year. The New Democrat Coalition Action Fund sent $1 million in contributions to numerous Democrat politicians during the 2022 elections.

Becker’s most recent donations came on the heels of $5,600 he donated between President Biden’s 2020 campaign and victory fund.

Jeffrey Leerink, the chief executive officer of SVB Securities, donated $1,250 to Massachusetts Democrat Rep. Jake Auchincloss during the 2022 and 2020 elections.

Meanwhile, Silicon Valley Bank’s chief credit officer, Marc Cadieux, poured $250 into Biden’s campaign during the 2020 elections.

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Senator Mark Kelly inquired about social media censorship to curb bank runs

On Sunday, while discussing the Silicon Valley Bank collapse in an emergency conference call led by Senate President Chuck Schumer, Senator Mark Kelly (D-AZ) reportedly inquired about the possibility of censoring social media posts to avoid a bank run.

This information was reported by Republican House members who were also present on the call and heard by representatives of the Federal Reserve, Treasury Department, and the Federal Deposit and Insurance Corporation (FDIC).

“Just got off of a zoom meeting with Fed, Treasury, FDIC, House, and Senate,” Kentucky Congressman Thomas Massie tweeted. “A Democrat Senator essentially asked whether there was a program in place to censor information on social media that could lead to a run on the banks.”

Rep. Lauren Boebert also tweeted, “On a briefing with Biden Under Secretary of the Treasury Nellie Liang regarding the SVB [Silicon Valley Bank] BAILOUT they are working towards and a member asked if they were reaching out to Facebook and Twitter to monitor misinformation and ‘bad actors.’”

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Journalist Uses AI Voice to Break into Own Bank Account

In a recent experiment, Vice.com writer Joseph Cox used an AI-generated voice to bypass Lloyds Bank security and access his account.

To achieve this, Cox used a free service of ElevenLabs, an AI-voice generation company that supplies voices for newsletters, books and videos.

Cox recorded five minutes of speech and uploaded it to ElevenLabs. After making some adjustments, such as having the AI read a longer body of text for a more natural cadence, the generated audio outmaneuvered Lloyds security.

“I couldn’t believe it had worked,” Cox wrote in his Vice article. “I had used an AI-powered replica of a voice to break into a bank account. After that, I accessed the account information, including balances and a list of recent transactions and transfers.”

Multiple United States and European banks use voice authentication to speed logins over the phone. While some banks claim that voice identification is comparable to a fingerprint, this experiment demonstrates that voice-based biometric security does not offer perfect protection.

ElevenLabs did not comment on the hack despite multiple requests, Cox says. However, in a previous statement, the firm’s co-founder, Mati Staniszewski, said new safeguards reduce misuse and support authorities in identifying those who break the law.

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Discover To Begin Tracking Purchases At Gun Retailers Starting In April

One month ago, credit-card provider Discover Financial Services, issuer of the eponymous credit card, stunned markets when it unveiled in its latest forecast that it expects its 2023 charge off rate to more than double from the 2022 average, hitting a multi-year high and hinting that the US consumer was about to hit a brick wall

Last week, Discover decided to cement that not only would its charge off rate soar but it was about to lose millions of customers after it told Reuters that it would effectively oversee (i.e., spy on) its clients by allowing its network to track purchases at gun retailers come April, making it the first among its peers to publicly give a date for moving ahead with the initiative, which is aimed at helping authorities probe gun-related crimes.

Discover’s announcement came after the International Organization for Standardization (ISO), which decides on the classification of merchant categories used by payment cards, approved in September the launch of a dedicated code for gun retailers.

Proponents of the move, almost exclusively Democratic politicians and gun control activists, say it will allow financial institutions to better assist authorities in investigating crimes involving gun violence in the United States. While the codes will not show specific items purchased, some Republican politicians have spoken out against the move, arguing it could violate the privacy of U.S. citizens lawfully buying guns.

Discover said it will include the new code in its next policy and product update to merchants and payment partners in April.

“We remain focused on continuing to protect and support lawful purchases on our network while protecting the privacy of cardholders,” Discover said in its statement to Reuters.

Curiously, a Discover spokesperson said following the publication of the story that other payment network companies had already decided to implement the new code in April, and that Discover was following their lead. While the Discover spokesperson declined to name those peers, it means that any legal purchase of guns now triggers a whole array of red lights and ringing bells across the government which has taken its crusade against legal gun ownership and purchases to unprecedented levels in recent years, even as gun-related crime in such democrat-controlled cities as Chicago and Baltimore hits record highs every year.

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Wells Fargo Cutting Home Loans to Whites, Will Focus On Lending To ‘Minorities’

Wells Fargo, the top mortgage lending institution in the U.S., announced its cutting home loan services to instead focus on select customers, namely “individuals and families in minority communities.”

The financial services company claimed the decision is based on market changes and a slowing economy, but that apparently isn’t stopping the company from woke virtue-signaling.

“We are making the decision to continue to reduce risk in the mortgage business by reducing its size and narrowing its focus,” Kleber Santos, CEO of Consumer Lending said in a press release, according to the New York Post.

Kristy Fercho, Well Fargo’s head of Home Lending and head of Diverse Segments, Representation and Inclusion, noted that the company instead will “expand” its operations to focus on minority borrowers.

“We will continue to expand our programs to reach more customers in underserved communities by leveraging our strong partnerships with the National Urban League, Unidos US and other non-profit organizations,” Fercho said.

“We also will hire additional mortgage consultants in communities of color,” she added.

The company will reportedly continue to cater to existing customers and “underserved communities.”

The Post also reported the company intends to “expand its retail team by focusing on existing bank customers and underserved communities, invest an additional $100 million to ‘advance racial equity in homeownership’ and deploying additional Home Mortgage Consultants in local minority communities.”

“The press release highlighted that $150 million will also be used to serve minority communities looking to refinance or buy a home, ‘helping more black and hispanic families achieve homeownership,’” The Post added.

This comes amid a general mortgage collapse as the Federal Reserve has been hiking interest rates over the last year to supposedly fight historic 40-year-high inflation.

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