The correspondent banking model is coming under pressure, so much so that the committee on Payments and Market Infrastructures (CPMI) has issued a consultative report earlier this month reviewing the issues.
Correspondent banks are an essential part of the global payments system, without which it would be very difficult to support payments across jurisdictions, especially the flow of hard currencies like dollars.
So what’s the problem?
Loosely speaking, turns out that when you make correspondent banks do proper due diligence on the respective local relationships they support, and institute strict anti-money laundering and counter financing terrorism (AML/CFT) rules, costs pile up to the extent that many business models become unprofitable. Read more
John Gapper looks at the European Court of Justice’s ruling this week that Google must remove the internet search results of people who wish them to be cleared. He finds the ruling troubling.
Or as he states:
…this only shows that the EU’s 1995 data protection directive is an ass.
Before long, people’s search results will start to resemble official biographies, recording only the facts that they want other people to know, and not the remainder of reality.
This contrasts heavily with the view of digital privacy campaigners who see the move as a significant step in the right direction. Read more
Well worth a read on Wednesday — and you really can get it via RVWS <GO> on the terminal — Bloomberg has released the review of how its journalists interacted with terminal users’ data:
Businesses breaching EU privacy rules will face fines of up to 5 per cent of their global turnover under sweeping proposals to be unveiled next month, says the FT. In the first significant update of data protection legislation since 1995, companies found to have mishandled any personal data they hold – be it of their customers, suppliers or their own employees – will face the highest levels of fines, which could extend to billions of euros for large multinationals. The measures are being finalised within the European Commission. They will have to be approved by national governments, some of which – especially Germany – will be reluctant to lose oversight on privacy matters to Brussels.
Google will begin handing over to European regulators the rogue data it intercepted from private WiFi internet connections within the next two days, in an effort to defuse growing controversy over its latest privacy blunder, the FT reports. ‘We screwed up,’ Google CEO Eric Schmidt said, in a wider interview with the FT. Google also faces US privacy suits over the data blunder, the WSJ adds.