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Developments in Bank regulators are focused on what they call "systemically
important" banks, defined as having more than $50 billion
banking that in assets, and the Fed requires that 31 banks undergo an
annual "stress test" to determine how they would weather
a downturn in their profitability.
affect ISOs In case you think this emphasis on regulation and

compliance is overbearing, let me remind you of what has
transpired in the last decade. Boston Consulting Group
reported that globally, since 2009, the largest banks have
agreed to pay in excess of $321 billion in fines and penalties
for egregious behavior, including money laundering,
interest rate manipulation, terrorist financing, rigging
credit derivative markets, rigging foreign-exchange rates,
rigging interest rates (for example LIBOR, the benchmark
rate that some of the world's leading banks charge each
other for short-term loans) and rigging commodities
markets.

In addition, some banks were penalized for homeowner
foreclosure processing abuses, violation of U.S. sanctions,
bogus tax avoidance schemes and misleading investors into
buying toxic mortgage debt. Specific banks mentioned in
By Brandes Elitch this report include JPMorgan, Citibank, Bank of America,
CrossCheck Inc. Wells Fargo, Barclays, Lloyds, Royal Bank of Scotland,
Deutsche Bank, Union Bank of Switzerland, Credit Suisse,
f you work in the payments space, you cannot avoid and Hongkong and Shanghai Bank. This is big bank bad
the daily news, press commentary and speculation behavior (BBBB).
about the role and future of the Consumer Financial
I Protection Bureau, the Dodd Frank Act, as well as Looking at the charges and settlements in detail, you could
the Durbin Amendment to that act, and bank regulation be forgiven for thinking that some of these banks acted
in general. as criminal enterprises. U.S. regulators levied most of the
fines, as the European and Asian regulators have not yet
Topics in the spotlight include whether the CFPB should caught up. Interestingly, to my knowledge, no officer of
the BBBB banks has served any jail time for these crimes.
JUNE 21–23, 2017 be abolished, or its director fired, or how the bureau can
Save $100 with code GS17
THE MAYFLOWER HOTEL / WASHINGTON, DC be harnessed to make life easier for commercial banks, Bank regulation is important to ISOs
which are overwhelmed with regulatory and compliance
costs. It seems that someone asks me every day what I Systemically important banks are required to have a
WHERE THE PREPAID INDUSTRY MEETS think is going to happen in this space, and if the acquiring "living will." This is a credible plan for how the bank
community will be affected, and if so, how?
would wind down in an orderly fashion in the event of
a crisis or impending bankruptcy. Currently, all large
The NBPCA’s Power of Prepaid is the must-attend annual I'll make the obvious point that being a processor or ISO U.S.-headquartered banks have passed their stress tests,
although it took a long time for BofA and Citibank to get
means that your very existence is predicated on a bank
event for the prepaid community attracting the attention sponsoring you and giving you access to the bankcard there.

rails of the banking system. If your bank is taken over,
and support of the industry’s most influential players. or fails, you could lose your ability to process payments, Dodd-Frank requires that banks have a minimum capital
Benefit from three days of cutting-edge content, which is why, as they say, attention must be paid. ratio of 6 percent and also requires stricter lending
standards. In a zero interest rate environment, where banks
discussions and enhanced networking as you engage U.S. banking came close to systemic failure have been for the last few years, it is more risky to start a
bank, which is why only three new banks were started last
directly with those leading the way in prepaid First, a little background will put this into perspective. year. It is also very difficult (I would say impossible) for a
People are generally unaware of how close the U.S.
compliance, legislation, regulation and innovation. banking system came to systemic failure in 2008. There new bank to succeed in a zero interest rate environment.
are roughly 5,083 Federal Deposit Insurance Corp.-insured
commercial banks in the country, but the problems lie Before the financial crisis of 2008–2009, about 100 new
with fewer than 20 very large banks, previously banks banks were started each year. It also takes a new bank
called "too big to fail." at least five years to reach profitability, so this is not an
investment that most people would feel comfortable about
Register by phone: Contact Albert Britton at (212) 803-8387 NBPCA’s Power of Prepaid 2017 in the current environment.
is brought to you by:
Register online: www.powerofprepaid.com

For sponsorship opportunities contact Stacy Gellman at (212) 803-8841 23

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