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Home » Daily Briefing » Daily briefing - 03 October 2018

Daily briefing - 03 October 2018

Lisa Stevens is to leave Wells Fargo after a 29 year long career at the bank. Stevens was head of retail banking for the Western US region, and previously head of small business at Wells Fargo. As a regional head, she reported to Carrie Tolstedt, who was forced out of the bank in the wake of the fake account-opening scandal that surfaced in 2016. Wells Fargo is attempting to claw back bonuses previously paid to Ms Tolstedt and former CEO John Stumpf. (Ms Tolstedt was due to return $69 million.) A Wells Fargo board report in 2017 found that Ms Stevens was in charge of a region that was an "unfortunate leader" in the fake account episode, although it did note that she also challenged the cross-selling model. But it was too little, too late. On external appearances, it appears that Ms Stevens is leaving of her own volition, but it clears the way for new people at Wells Fargo. "Stevens is among a generation of leaders that helped make Wells Fargo what it is today," noted, listing Stevens alongside many other senior leaders that have left or been forced out in the last two years.

The EU's Office of Data Protection will launch an inquiry into the latest theft of data from Facebook, newly empowered to fine the company up to four percent of annual turnover. Facebook reported the breach last Friday, after thieves made off with SSO (Single Sign On) tokens for up to 50 million users. The data commissioner estimates that up to 10 percent of those accounts are inside the EU. While SSOs offer a convenient way to access multiple websites without creating new credentials, they can also provide a thief with extensive access through one's accounts. The SSO enables Facebook users to sign in to other sites such as Pinterest and Tinder using their Facebook credentials, but also enables Facebook to track those users across the web. As legal reporter Gavin Sheridan points out, access to SSOs means that thieves could start out by targeting the two thousand most high-profile people among the 50 million, using the Dunbar multiplier of 150, gets the thieves access to 300,000 accounts, and then up to 45 million using the same principle on the next circle. With thousands of financial businesses poised to join the world of open APIs and shared data, the actions of the data commissioner will be significant.

The Irish duo of Patrick Lynch and Tony Ennis have discovered a seam of SME business to mine in the Phillippines, where SMEs account for 99.6 percent of the country's business. But according to their new business First Circle there's a vast market for SME financing due to the country's lack of a formal credit scoring system. "A lack of access to capital is a problem that faces tens of thousands, if not hundreds of thousands, of businesses in the Philippines," Patrick Lynch told Techcrunch. "Emerging markets are not capital developed, and our business model is quite different from the p2p lender model in that we do share risk with the investors." Asset managers and family offices take half of the loans. First Circle sees the opportunity to build long-term relationships with growing businesses. "Many new providers of financial services are rating customer for the first time. In 80 percent of the time in our case, it's the first time our customer will have had a formal relationship" with a financial organization, Lynch explained. "That provides an opportunity, if done correctly, to provide a strong relationship and be a part of their future success for a long time."

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Wells Fargo received two stars in the Lafferty 2017 benchmarking project. The maximum score is five stars.

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