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Friday, May 28th, 2010

Senate Passes Financial Oversight Bill

Last December, the U.S. House of Representatives passed a financial oversight bill that would address many of the problems on Wall Street that led to the stock market collapse that touched off the Great Recession. Last week, as the New York Times reported, the Senate passed a similar bill.

Now, the two houses plan to work to unify their bills into one that can be signed into law.

Reforms Addressed

In the version of the bill that passed the Senate, changes to the current financial system would include:

  • Provisions to curb abusive lending practices, especially in the mortgage industry
  • Safeguards that would guarantee that large and complex companies could be liquidated - possibly in bankruptcy - without having taxpayers foot the bill
  • Requirements that would force large banks to detach some of their profit-rich derivatives operations into separate entities (though this provision was not in the House’s version of the bill)
  • The introduction of a “Financial Stability Oversight Council,” which would be charged with highlighting troublesome trends that could prove dangerous for the whole economy
  • The introduction of new rules for derivatives traders
  • The requirement that hedge funds and similar companies register for regulation with the Securities and Exchange Commision (SEC)

The Senate’s passage of the bill is seen as a victory for the Obama administration, which has blamed the recession largely on a lack of oversight and accountability on Wall Street.

The Next Step for Finance Bill

In the coming weeks, as the Washington Post reports, a group of senators and representatives will work together to reconcile the differences in content between the two bills, aiming for a version that Obama could sign into law.

While the two versions are reportedly very similar at this stage, sources indicate that the main differences between the two include:

  • Plans for regulating the complicated derivatives market
  • Whether to ban banks’ current practice of trading on their own accounts (proprietary trading)
  • Whether to require a $150 billion fund from financial industry coffers to allow for emergency dissolution of any struggling firm
  • Whether to create a separate agency charged with matters of consumer financial protection

According to sources, leaders in the House and Senate hope to reach a consensus on the provisions included in the legislation by July 4th of this year.

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Posted in Finance 101: Secure Your Future | No Comments »

Sunday, July 5th, 2009

Protecting Your Money Online

Since the Internet’s explosion into our lives, we’ve been introduced to amazing new ways of interacting with each other, doing business and connecting with the world.

Unfortunately, the Internet has also introduced a variety of new crimes and consumer vulnerabilities.

The Numbers

  • A recently released Consumer Reports survey showed that 20 percent of Americans (that’s one in five!) have been victimized by online criminals in the past two years.
  • In that time, sources estimate that cyber criminals absconded with $8 billion of victims’ money.

These figures are shocking, but they don’t mean that victimhood is unavoidable.

In fact, related studies have shown some important steps you can take to protect yourself, your computer and your personal information - credit card numbers, SSN, bank information, etc. - from thieves.
Dangerous Browsing

So how do online crooks trick you into parting with your cash? Much more cleverly than you might have suspected.

A report released by McAfee called “The Web’s Most Dangerous Search Terms” reveals a lot about how online scams and crimes work.

The riskiest search terms are, in this order:

  • Lyrics
  • Free
  • Web
  • Gear, gadgets, games
  • Olympics
  • Videos
  • Celebrities
  • Music
  • News

What does this mean for you? After you search a term, say, “song lyrics," a list of Web sites will come up. You choose one by clicking on it. If the site is malicious, you could be compromised in a couple ways:

  • Simply visiting the site could infect you
  • Clicking on any links on the site could harm you

What Happens Once You’re Infected

Criminal sites often work by installing spyware onto your computer. You might find that some of your online passwords don’t work, then find yourself redirected to a site on which you have to enter personal information to “confirm” your identity.

Unfortunately, many scam sites look legitimate. And many Americans have spyware on their computers. Some spy programs work by recording password information you type in and sending it to another computer (the criminal’s).

How to Protect Yourself

  1. Stick to sites you know and trust. Understand that, when you attempt to download things for free, you may get much more than what you pay – in an unpleasant way.
  2. Install security programs onto your computer.
  3. Update your computer regularly. Many updates are designed to protect against the latest scams and viruses.

Protecting yourself online is important.

Some people's finances have been ruined thanks to identity theft scams. In fact, some people wind up filing bankruptcy because of identity theft.

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Posted in Identity Theft | No Comments »