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from Financial Regulatory Forum:

Safeguard customers’ personal information; regulators are watching

By Julie DiMauro, Compliance Complete

NEW YORK, Sept. 19, 2014 (Thomson Reuters Accelus) - In a sanction that can serve as a wake-up to the financial industry, Verizon Communications last week agreed to pay $7.4 million to end an investigation that found it failed to tell two million new customers about their privacy rights before using their information for marketing purposes, the Federal Communications Commission said.

The privacy probe highlights the vigilance that must be paid to consumer privacy rights to meet regulators’ requirements. Although the financial industry mostly answers to different regulators, it too is subject to laws and regulations protecting the privacy of its customers.

The FCC said its investigation found that these phone customers, starting in 2006, did not receive proper privacy notices in their first bills. The notices would have told consumers how to opt out of having their personal information used to tailor marketing offers, which the company later sent to them. Compounding the lapse, the FCC learned, Verizon failed to discover these problems until September 2012 and failed to notify the FCC of these problems until January 18, 2013 -- 126 days later.

Phone companies are generally prohibited from using personal data they collect from their customers, although such data can be used for marketing – if the consumer gives permission via an "opt-in" or "opt-out" process.

from Breakingviews:

Larry Ellison cedes driver seat with hand on wheel

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

Larry Ellison is ceding the driver’s seat at Oracle while keeping one hand on wheel. The software giant’s founder is stepping down as chief executive officer, but his 25 percent stake in the company – and dual role as chairman and chief technology officer – ensure he’s far from relinquishing control. Splitting his former job between two executives could, however, lead to a bumpy transition.

from Breakingviews:

VC bigwigs reveal Valley’s contradictions

By Richard Beales

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

A venture capitalist who can co-opt the opening lines of “Anna Karenina” to make a business point deserves attention. In Peter Thiel’s case, he also started PayPal and Palantir Technologies and invested early on in Facebook. His new book, “Zero to One,” describes possible features of the next peerless, world-changing startup – another Google, say.

from Breakingviews:

Alibaba’s small IPO hike leaves room for believers

By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

Pricing initial public offerings is an inexact science. Predicting how investors will value a large, fast-growing Chinese e-commerce group involves even more guesswork. That makes Alibaba’s decision to lift the maximum price for its upcoming stock market debut by just $2 a share to $68 puzzling.

from Breakingviews:

Apple cooks up recipe to empty pockets and wallets

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

Apple has cooked up a recipe for emptying pockets and wallets. In addition to unveiling two new smartphones, the tech giant has combined a fingerprint sensor and an overlooked app into an iPhone payment system that looks secure and easy to use. A new watch lacks obvious appeal but has potential to replace car keys and other pocket detritus. Higher profits may be the cherry on top.

from Breakingviews:

LendingClub IPO mixes disruption with confusion

By Kevin Allison and Daniel Indiviglio

The authors are Breakingviews columnists. The views they express are their own. 

LendingClub is positioning itself as one of the biggest challengers to American banks. The company is growing quickly, has backing from the likes of Google and lists former Morgan Stanley boss John Mack and ex-Treasury Secretary Larry Summers among its directors. It’s also planning an initial public offering. But there are reasons to be cautious.

from Breakingviews:

Home Depot hack scarier than Hollywood breach

By Richard Beales

The author is a Breakingviews columnist. The opinions expressed are his own.

It’s no surprise that stolen nude photos of Jennifer Lawrence attract more attention than a nerdy report on Home Depot’s security breach. But it’s an unfortunate reality that Hollywood celebrities need to guard their privacy, whether threatened by paparazzi or hackers. Corporate breaches that expose millions of people to financial loss are, on the other hand, in a different league.

With Home Depot, it’s not yet clear what the scale of any hacking may have been, or whether the company’s systems were violated despite strong defenses. But security blogger Brian Krebs said he had received information suggesting the Home Depot episode could be larger than last year’s hack of Target. That attack, which he first publicized, exposed the credit card data of at least 40 million customers.

from Breakingviews:

Square swipes a hollow-looking $6 bln valuation

By Robert Cyran

The author is a Breakingviews columnist. The opinions expressed are his own.

Square is starting to look oddly hollow. The payments company set up and run by Jack Dorsey is set to raise $200 million in new funding, according to Bloomberg. That would value the company at $6 billion. While big, it’s a deflated figure, considering Square’s former hype, the small amount raised, and tech rivals’ ease securing higher valuations.

Square’s credit card readers for smartphones and tablets are easily spotted in the wilds of flea markets and coffee shops. They are easy to use, and the 2.75 percent they charge per swipe is relatively appealing for small transactions. Last year the company racked up more than $500 million in revenue.

from Breakingviews:

Snapchat’s valuation soars on tech-land pixie dust

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own

Snapchat’s valuation is soaring on tech-land pixie dust. The disappearing-photo business has turned 100 million users, strong demand for chat services and the $20 million sale of a tiny equity stake into a $10 billion price tag. Trouble is, the company lacks revenue – and none is in sight. It’s a reminder that Silicon Valley dreams often trump real economics.

from Breakingviews:

SoftBank’s U.S. mobile retreat is least bad option

By Peter Thal Larsen 

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Masayoshi Son has been forced to scale back his mobile phone ambitions in the United States. The chief executive of Japan’s SoftBank has belatedly bowed to hostile regulators and abandoned plans for his Sprint unit’s $32 billion takeover of T-Mobile US. He has chosen the least bad option.

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