Three news to start your week: July 17
Crypto industry secures early victory in legal battle With regulators
(The New York Times)
The selling of a digital asset called XRP on public exchanges was in compliance with securities rules, a federal judge determined on Thursday, giving the cryptocurrency industry an early advantage in its legal struggle with American regulators.
The Securities and Exchange Commission has maintained for years that digital assets qualify as securities, just like the stocks and bonds traded on Wall Street, and as such, they need to be governed by the same stringent laws. The SEC sued Coinbase and Binance, two of the biggest cryptocurrency exchanges, last month on the grounds that they had misled the public by promoting unregistered securities.
However, the decision on Thursday in a case involving the cryptocurrency startup Ripple may complicate that contention and give the sector's legal defense more material.
Merrill Lynch to Pay $12 Million for Failing to File Hundreds of Suspicious Activity Reports
(Wall Street Journal)
Merrill Lynch, a broker-dealer, has agreed to pay a total of $12 million in fines to authorities after failing to disclose 1,500 instances of suspicious activity over a decade.
US anti-money-laundering regulations require broker-dealers like Merrill Lynch to submit suspicious activity reports to the Financial Crimes Enforcement Network on transactions over $5,000 when they may indicate illegal activities, such as tax evasion, to help US government agencies identify and stop money laundering.
Following Bank of America's acquisition of Merrill during the 2008–2009 financial crisis, Merrill Lynch's parent company, which was implementing the broker-dealer's anti-money–laundering program, used a $25,000 threshold rather than a $5,000 one for reporting SARs between 2009 and late 2019, the Securities and Exchange Commission said on Tuesday.
To resolve the SEC accusations, Merrill consented to pay $6 million.
Transatlantic inflation gap set to hit the highest level in decades
(Financial Times)
This week, as Britain continues to outperform the rest of the world in terms of inflation, the gap between price pressures in the US and the UK is set to grow to levels not seen since the late 1970s.
According to data released this week, consumer price inflation in the US is rapidly declining, with the annual rate for June falling to a two-year low of 3%. In contrast, experts anticipate that the UK's CPI reading for the previous month, scheduled to be released on Wednesday, would be higher than 8%.
As of Friday afternoon, Reuters polled economists who predicted an average June number of 8.2%. If they are correct, UK inflation is 5.2 percentage points higher than US inflation, marking the largest difference since November 1977, when the nation was plagued by political unrest and economic stagnation.
