Good morning, Netizens…

 

There was a sort of an earthquake hit the Spokane region last Friday, and as of yesterday, hardly anyone is talking about it. Oh, sure the news media have been vapidly referencing the tersely-worded announcement and somnolent quotes from the Department of Financial Institutions. I am speaking, of course, of the shutdown of the Bank of Whitman formerly of Colfax, Washington, which sent yet another tremor of fear through the Spokane regional marketplace.

 

As of Monday harried employees of the Columbia Banking Systems Inc. of Tacoma, which has purchased control of some, not all, assets of the former Bank of Whitman attempted to reassure former patrons of the Colfax-based bank. Their money is safe, guaranteed by the FDIC, and they can continue banking under the new system without fear. Although no records are available showing how many former clients of the Bank of Whitman are bailing out of the new bank, I suspect the number is much higher than we are being told.

 

The bottom line is we are seeing the logical outcome of the mind-boggling descent of the national economy in action, among other things. In recent years, the former Bank of Whitman underwrote many high-end commercial real estate developments, some of which did not quite turn out the way their developers had expected, due to the downturn in the economy. When loans do not get paid, when major business developments enter into default, the FDIC begins watching things closely.

 

In the towns of Lacrosse, Endicott, Washtucna, Lind, Pomeroy, Mattawa, Rosalia, Royal City, Warden, Pasco and Kennewick, the doors of the Bank of Whitman are now closed, as they are now owned by the FDIC and not part of the asset purchase by the Columbia Banking Systems. Some employees will lose their jobs entirely, along with any benefits they may have accrued. I would imagine a financial chill has inexorably begun descending upon some of these towns for, until recently, The Bank of Whitman was the only bank in town for most of the smaller burgs.

An old and tested axiom states, all that glitters is not gold. Developers of some of certain huge commercial real estate should take note. Don't build edifices you cannot immediately sell, lease or rent; don't even think about asking a banker about it. Of course, your opinions may differ.

Dave

Your boss may be showing signs of concern with the hours you're spending watching YouTube at the office.

Here's the solution: Tell the boss you're viewing YouTube for handy videos on topics such as deposit insurance and Net Fraud.

The Federal Deposit Insurance Corporation (FDIC) has a number of fairly useful online tools to give consumers tips and hints on investments and fraud alerts.

One of them is, indeed, a YouTube FDIC channel.

Other online resources provided by the tax-supported FDIC:

• “EDIE,” the FDIC's Electronic Deposit Insurance Estimator — an online calculator to determine their deposit insurance coverage for each FDIC-insured bank where they have deposit accounts.
• FDIC Consumer News — a quarterly publication for consumers with tips on credit cards, bank accounts, loans, scams, money management and  more. Consumers can also listen to articles anywhere, anytime online or by downloading to an MP3 player.
• Bank Find —  an online directory that consumers can use to locate an FDIC-insured institution bank, learn what happened to a bank that changed names or no longer exists, and more.
• Customer Assistance Online Form — A form to submit a question to the FDIC or a complaint regarding a financial institution.
•  Small Business Web Page — Helpful tips for small businesses, especially regarding access to loans, plus an online form to ask the FDIC a question or register a concern.
•  Money Smart – A financial education curriculum concentrating on the development of consumers' financial skills and positive banking relationships.
•  Foreclosure Prevention Toolkit —  A Web page that provides easy access to helpful information for homeowners on avoiding foreclosure and foreclosure “rescue” scams.

Last Sunday The Spokesman-Review business section carried a story about the growing number of cyber crimes directed at small and midsized firms.

This week we find the FDIC (Federal Deposit and Insurance Corporation) is concerned about the same growing problem.

It’s hosting a day long symposium in Arlington, VA., on May 11, focusing on the increasing need by companies to work with law enforcement to contend with the threat.

The FDIC release said:  “Division of Supervision and Consumer Protection Director Sandra Thompson says the program is intended to raise awareness to the potential threats to commercial payments and explore best practices and technologies available to mitigate this risk.”

FDIC analysis of Financial Crimes Enforcement Network’s (FinCEN) Suspicious Activity Reports indicates that bank losses related to computer intrusion or wire transfer have increased “significantly” as of last fall.

These schemes—also known as “corporate account takeovers”—typically involve compromised access credentials to online business banking software that are used to make fraudulent electronic funds transfers (EFTs) through the automated clearinghouse (ACH) and wire payment systems.

The illicit proceeds from these activities are often funneled through some type of fraudulent work-at-home scheme involving individuals who knowingly, or unknowingly, serve as “money mules” by forwarding funds to criminals outside the United States.