Impact of ‘no deal’ Brexit on insolvency “deeply concerning” – R3

The potential impact of a ‘no deal’ Brexit on cross-border insolvency cases, as set out by the Government in a just-published technical note, is deeply concerning, says insolvency and restructuring trade body R3.

Commenting, Stuart Frith, R3 president, says: “We would be deeply concerned about the impact of a ‘no deal’ on the UK’s insolvency and restructuring framework. The strength of the UK’s insolvency and restructuring framework partially depends on its pan-European reach. At the moment, EU regulations mean UK insolvency and restructuring procedures and judgments are automatically recognised across the EU – and vice versa. A loss of this recognition, as would happen in a ‘no deal’ situation, would be bad news for UK businesses and creditors.

“Reciprocal automatic recognition means it’s relatively quick and cost effective to retrieve the assets of insolvent UK-based companies or individuals wherever those assets are in the EU. It means the insolvencies of companies with a presence across the EU can be dealt with through one insolvency procedure rather than several. This keeps costs down and increases the chances of business rescue, which, in turn, boosts returns to creditors.

“If the current EU-UK insolvency framework is not preserved post-Brexit then it will become much more expensive and difficult to resolve UK and EU insolvency cases where UK-EU cross-border work is required.

“This will jeopardise creditor returns, business and job rescue, lending and investment, and it will damage the UK’s reputation as a place to do business.

“The insolvency and restructuring framework is there to provide businesses, lenders, and investors with the confidence that, in the event of an insolvency, they will see at least some of their money back. Adding barriers to this process where a UK company has a presence in the EU would damage confidence in trading with, lending to, and investing in that company.

“The Government has repeatedly outlined a desire to seek a post-Brexit agreement which closely reflects the principles of mutual cooperation that exist under the current EU framework. This is welcome and R3 is happy to support the Government’s pursuit of its objective.

“In the event of a ‘no deal’, it’s important that the Government takes steps to improve the domestic insolvency framework in order to maintain its international competitiveness. The Government has just published plans to deliver a package of major insolvency reforms first proposed in 2016, but the timetable for introducing them is not clear. Introducing the reforms would be a good step towards mitigating some of the problems which the loss of automatic recognition might cause.”

Regulation, innovation and emigration: LinkedIn data shows how the recession and Brexit have changed financial services

Ten years on from the onset of the global financial crisis, LinkedIn has analysed data from its 25million UK members to build a comprehensive picture of the evolution of financial services roles.

The data reveals how regulation, developments in technology and the EU Referendum vote have been key drivers impacting where and how people work in the sector.

Above all, there’s good news for jobs: since a low in hiring activity in the summer of 2016, coinciding with the Brexit vote, hiring in financial services has been slowly but steadily increasing. LinkedIn’s data shows that the hiring rate in July 2018 was up 8% compared to July 2017.

The latest LinkedIn UK Workforce Report includes LinkedIn’s data as well as findings from a ‘Recruiter Sentiment’ survey of over 600 HR professionals across the UK. It identifies three trends:

Financial services hiring more workers from other sectors, responding to regulation and technical change.

Automation and regulation have led to changes to job roles in financial services. Looking at the top five job roles being hired for, sales and customer facing roles have experienced the biggest decline in new hires during the past five years. Meanwhile, demand for new hires in legal and software roles has increased.

British financial services firms are also becoming more diverse in terms of career background and finding new sources of talent. The percentage of new hires from other finance companies has dropped by 7.1% since 2013. Hires from professional services firms are up 25.3% over the same period and, coinciding with the increase in demand for more technical skills, the percentage of new hires from Software and IT services is up 18.1%.

Emerging technologies are driving demand for new skills, but supply is lacking.

Beyond the immediate consequences of 2008, other forces have been at work, notably the growth of the UK as a fintech hub. The Recruiter Sentiment survey showed that over half (51%) of UK recruiters have seen an increase in demand from financial services businesses to hire candidates with Artificial Intelligence (AI) skills over the past five years, a 49% increase in demand for cryptocurrency skills and 46% for blockchain.

However, when it comes to hiring candidates with these emerging tech skills in financial services, 55% of UK recruiters and hiring managers are struggling to fill roles according to the Recruiter Sentiment survey, saying there are a greater number of jobs than available candidates with the right skills. This is most acute in the Midlands, where 63% say they can’t find the right employees.

With the rise of fintech, traditional first choice employers have lost some of their appeal: with 32% of UK recruiters and hiring managers saying that traditional banks are now less attractive to candidates.

Less migration into the UK is seeing a greater share of finance jobs filled by UK educated workers.

The third key factor in the changing face of UK finance has been migration. As LinkedIn data and official statistics have shown, migration from the EU and the rest of the world has declined, and finance has seen an impact.

UK educated workers have taken a larger share of new financial services hires in recent years, but it’s not a straightforward case of fewer professionals arriving from abroad.

The number of new hires in the financial services sector educated in the UK is rising, from 76.4% in 2013, compared to 78.6% in 2017. At the same time, the share of UK-based financial services workers receiving their first university degree in the EU has fallen (from 14.4% in 2013-14 to 12.4% in 2017-18).

Josh Graff, UK Country Manager at LinkedIn, comments: “The financial services sector has reinvented itself since the crash. The pace and scale of change has been tremendous and is reflected in the huge demand for emerging tech skills and increasing competition for talent from disruptors. It’s good to see that the industry is adapting by looking for new sources of talent outside of itself, but business leaders also need to think about how the current workforce can be retained and upskilled in order to keep up with the pace of change.”

Graff continues: “Over the last five years, the UK financial services industry has become a less attractive proposition for international professionals, and this accelerated after the Brexit vote. With an ever-growing skills gap, this should be a warning sign for the UK’s financial services industry and its ability to continue serving as a growth engine for the UK economy. It’s crucial that we attract and retain talent from elsewhere in the world in order to bring new skills and knowledge to such a vital part of the UK workforce.”

The LinkedIn Workforce Report is designed to provide members, businesses and policymakers with evidence-based insights into the changing shape of the UK workforce. This month the report includes the results of an independent ‘Recruiter Sentiment’ survey that gauges UK-based in-house and agency recruiters’ confidence in their ability to fill available roles.

Cybereason Announces its Newest Customer V12 Retail Finance

Cybereason, creators of the leading cybersecurity AI Hunting Platform, today announced that V12 Retail Finance, one of the leading retail finance providers, is now a customer.

V12 Retail Finance provides retail point of sale finance for more than 2,000 retailers in the UK through its innovative online platform. It has seen significant growth over the past 5 years, expanding its Cardiff based workforce from 30 to 220 staff and growing approved loans to almost £750m in the last 12 months.

“Cybereason’s unique, innovative and easy-to-use solution is unlike others on the market and its innovative approach is one of the biggest reasons why we chose to use its AI Hunting Platform,” said Matt Hatton, IT Director at V12 Retail Finance. “Our employees, customers and partners are connecting multiple devices from disparate locations to our network making it a challenge to protect our business. Cybereason is the only company we spoke to that has the ability to meet our security challenges as we continue our rapid growth.”

“V12 Retail Finance has joined our growing list of international customers and we couldn’t be happier as we continue our EMEA expansion,” said Sam Schofield, Regional Vice President, Cybereason. “V12 sees the value in our award-winning AI Hunting Platform and our ability to stop increasingly sophisticated threat actors. Relying on yesterday’s technologies will not get the job done, and we’re excited to see our approach and perseverance recognized by V12.”

Cybereason is one of the fastest growing technology companies in the world. Founded in 2012 by Div and co-founders Yossi Naar and Yonatan Striem-Amit, Cybereason has exploded from a three-person team to more than 350 employees globally.

FICO Makes Artificial Intelligence Explainable with Latest Release of its Analytics Workbench

Leading analytics firm FICO today announced the latest version of FICO® Analytics Workbench™, a cloud-based advanced analytics development environment that empowers business users and data scientists with sophisticated, yet easy-to-use, data exploration, visual data wrangling, decision strategy design and machine learning.

As new data privacy regulations shine a spotlight on AI and machine learning, the FICO Analytics Workbench xAI Toolkit helps data scientists better understand the machine learning models behind AI-derived decisions.

“As businesses depend on machine learning models more and more, explanation is critical, particularly in the way that AI-derived decisions impact consumers,” said Jari Koister, vice president of product management at FICO. “Leveraging our more than 60 years of experience in analytics and more than 100 patents filed in machine learning, we are excited at opening up the machine learning black box and making AI explainable. With Analytics Workbench, our customers can gain the insights and transparency needed to support their AI-based decisions.”

“Computers are increasingly a more important part of our lives, and automation is just going to improve over time, so it’s increasingly important to know why these complicated AI and ML systems are making the decisions that they are,” said assistant professor of computer science at the University of California Irvine, Sameer Singh. “The more accurate the algorithm, the harder it is to interpret, especially with deep learning. Explanations are important, they can help non-experts to understand the reasons behind the AI decisions, and help avoid common pitfalls of machine learning.”

Built for both business users and data scientists, the FICO® Analytics Workbench™ combines the best elements of FICO’s existing data science tools with several open source technologies, into a single, cloud-ready, machine learning and decision science toolkit, powered by scalable Apache Spark technologies. The Analytics Workbench provides seamless and automated regulatory audit compliance support, producing the necessary documentation for internal review and external regulators.

The Analytics Workbench has been designed for users with a variety of skill sets, from credit risk officers looking for a consistent tool to data scientists and business analysts collaborating and working together to inform and enrich strategic decision making. With an intuitive interface, users can expect faster time-to-value, higher levels of productivity, and significant business improvements through analytically powered decisions.

CA issues response to HCLG Select Committee Leasehold Reform Inquiry

The Conveyancing Association (CA), the leading trade body for the conveyancing industry, has today (11th September 2018) issued its response to the Housing, Communities & Local Government (HCLG) Select Committee’s Leasehold Reform Inquiry.

The HCLG launched its inquiry into the Government’s leasehold reform programme in July this year and it focuses in particular on how ‘existing leaseholders in both houses and flats facing onerous leasehold terms can be supported’.

The Committee has invited submissions to be made on three issues:
· The adequacy of the Government’s programme of work on residential leasehold reform, including (a) its application to existing leaseholders in both houses and flats and (b) whether further reforms should be introduced;
· What support and Government intervention can be provided to existing leaseholders, in both houses and flats, affected by onerous leasehold terms; and
· What are the implications of providing such support and Government intervention to these existing leaseholders.

The CA’s response contains details regarding ongoing problems with leasehold, including the growth in the number of titles sold as leasehold every year (now standing at in excess of 20%) and the fact they take, on average, 20 days longer than freehold properties to achieve exchange of contracts. It has also expressed concern at the down valuation of leasehold properties by valuers due to the perceived onerous terms of the lease and the difficulty for existing leaseholders to sell properties.

It also highlights the abusive practices of some Lease Administrators, particularly with regards to the inflated charges they insist on existing leaseholders/prospective purchasers meeting in order to secure documentation like Certificates of Compliance, Deed of Covenants, Notice of Assignment, Notice of Charge, and others.

The CA also wants the Government to follow through on its commitment to make sure Lease Administrators have to provide this information within a fixed period – its data shows that in 37% of cases it takes over 30 days to receive the information required for sale from the Lease Administrator from point of payment.

The trade body has also outlined its concern that developers, particularly when it comes to the marketing of leasehold properties, are not complying with the Consumer Protection from Unfair Trading Regulations (CPRs) which require them to provide material information that would affect a consumer’s decision-making process when deciding to purchase.

The CA suggests that information such as the service charge, ground rent, terms of lease, restrictions on use, alteration or occupancy and any intended increase in ground rent and service charges would be material to a consumer’s transactional decision, and should therefore be included in the upfront marketing information.

As part of its role within the Legal Sector Group, the CA has also detailed a range of leasehold reform proposals it would like to see introduced covering: administrative activities, timescales for them, enforcement, unfair lease terms, overhaul of tenure, buildings insurance and management regulation.

The CA has issued the response to all its member firms and is urging both them, and all other industry stakeholders, to file their own individual response to the Select Committee by the deadline date of 14th September.

Beth Rudolf, Director of Delivery at the Conveyancing Association, said: “When the MHCLG responded to its own Call for Evidence on the Home Buying and Selling Process it confirmed it would mandate lease administration fees and require Administrators to respond within reasonable timescales. We have yet to see any progress being made to introduce this, however firmly believe that it will deliver major benefits to those looking to sell or purchase a leasehold property, cutting down significantly on the time it takes to exchange contracts.

“For too long, Lease Administrators have been able to set their own level of (overly inflated) charges and keep stakeholders waiting weeks/months on end, before delivering the necessary documentation. Given such activity, or rather lack of it, it’s no wonder that the time period to get to exchange of contracts on a leasehold property is that much longer than on a freehold basis.

“Our submission to the Leasehold Reform Inquiry provides tangible solutions that we, and as part of the Legal Sector Group, believe can positively impact on the experience of those looking to buy, sell, or currently live in, leasehold properties.

“Alongside the curbing of charges made by Lease Administrators, and insisting they respond quickly, we believe there needs to be far better upfront provision of information to those considering purchasing a leasehold property – we want to see greater detail on lease terms, charges, and the like, to ensure that the individuals are far better informed about what they are signing up to.

“Progress on leasehold reform is being made but we would like to see the Government move far more quickly in this area because the longer we wait, the greater potential for leaseholder detriment there is.”

GDPR and Blockchain … Like handcuffs on a ghost.

It’s always exciting when then technology and legislation collide. A new report highlights the problem no one dares mention. Blockchain, the much hyped technology with hundreds of millions of pounds investment riding on it, is ‘incompatible’ with GDPR.

The report, authored by fintech journalist Bird Lovegod, ex co founder of The Fintech Times newspaper, was commissioned by blockchain company Cygnetise.

It jumps straight to the point. GDPR legislation is designed around the idea that there is a central database. With public blockchains, including the bitcoin blockchain, this just isn’t true. There is no central point, the whole purpose of blockchain is to avoid having one. GDPR addresses data controllers, requiring them to comply with the seven GDPR principles. With public blockchains, there is no data controller. The actual language of the legislation immediately comes a cropper when encountering the decentralised structure of blockchain. As the report highlights, this is both unfortunate and ironic. GDPR was introduced to bring data protection into the modern age, the old data protection act having been launched right at the birth of the digital reformation. GDPR was designed to counter the problem of technology moving faster than legislation can ever keep up.

As such, it relies on seven principles. According to Bird Lovegod, “With some public blockchains, six of these seven GDPR principles are either breached, or rendered non applicable in some way. What’s more, it’s almost impossible for any court to enforce any action against public blockchains, there’s no one in charge, no one to serve documents to, no one to even name on legal papers. In the instance of Bitcoin, who are they going to summon? Satoshi Nakamoto? No one even knows who invented it. In practice they would have to prosecute everyone on the network. It’s a bit of a farce. The very legislation designed to ‘future proof’ data protection has been launched right at the time when technology has fundamentally changed the rules. And that’s even before Ai becomes involved. When an autonomous software system breaches EU data legislation, who you gonna call then? Blockchain technology was designed to exist outside of central control and independently of government rule. It still does. GDPR slides off it like handcuffs on a ghost.”

However, as the report goes on to explain, with Private Blockchains, it’s a much better fit. “There’s definitely still a grey area , but at least the GDPR definitions apply, and six of the seven principles are pretty much do-able.” Explains Bird, “The biggest problem is the immutability of blockchain, the unchangeable nature of the data on it. Nothing can be deleted. It would be like taking a link out of a chain. One of the rights afforded by GDPR is the right to be forgotten, the right to have your data deleted. This is literally impossible for blockchain to do.” The report goes on to detail a possible fix, which involves encryption rather than deletion, which would require the consent of the individual.“ Ultimately, says Bird, the question is, do we have the right to amend our own rights? Perhaps that’s the ultimate in consumer rights, being able to choose which ones we want, individually.” No doubt Satoshi would approve.

Corinium Names FICO Chief Analytics Officer Dr. Scott Zoldi to Top 100 Innovators in Data and Analytics

Leading analytics firm FICO today announced that its chief analytics officer, Dr. Scott Zoldi, has been named one of the top 100 innovators in data and analytics by Corinium. Corinium’s list spotlights business leaders, technologists and influencers who have accelerated the proliferation and understanding of data and analytics over the last 12 months.

“My focus is on applying artificial intelligence and machine learning to our customers’ operational data, to allow actionable and measurable decision management,” said Dr. Scott Zoldi. “I get tremendous satisfaction from helping FICO’s customers to solve their complex business problems; much of my time is spent listening and consulting with customers directly. I am gratified to join this list of fellow innovators who are changing the way the world works with analytics.”

“The Corinium Top 100 Innovators in Data and Analytics list showcases those who have provided an outstanding contribution to the industry,” said Adam Plom, managing director, Americas and Europe at Corinium. “Driven by his fascination of behavioural patterns and predictive insights that data can yield, Scott Zoldi has led the advancement of multiple analytics innovations, has numerous patents pending and we are delighted to honor his work for 2018.”

While at FICO, Dr. Zoldi has been responsible for authoring 91 analytic patents, with 43 patents granted and 48 in process. Dr. Zoldi is actively involved in the development of new analytic products and machine learning applications, many of which leverage new streaming analytic innovations such as adaptive analytics, collaborative profiling and self-calibrating analytics, such as the FICO® Falcon® Platform, which protects more than 2.6 billion payment cards worldwide.

Dr. Scott Zoldi blogs about AI, machine learning and other analytics topics on the FICO® Blog, and is on Twitter @ScottZoldi.

Corinium is the world’s largest community designed to inspire and support the emerging C-Suite executives focused on data, analytics, customer and digital innovation.

Equiniti Data announces launch of EQ Amplify which provides fully-compliant access to their entire UK consumer database

Equiniti (EQ) Data, marketing solutions provider and the data division of Equiniti Plc. is proud to announce the launch of EQ Amplify- a new way for marketers to access a centralised UK consumer database, including a flagship classification model.

The use of consumer data in business is changing, and at pace. At the same time, consumer expectations are higher than ever. For most marketers, who are competing with corporate giants like Amazon and Google, the question is how to intelligently and compliantly access this data to deliver a more personalised customer experience. EQ Data’s solution, EQ Amplify, is designed to address the many concerns of marketers and their access to consumer data over recent months. With EQ Amplify, organisations can bridge the gap between great customer experiences and access to compliant data.

EQ Data’s consumer database is currently the largest in the UK, representing over 99% of the consumers in the UK, with 65 million UK adults, from over 28 million households. It is drawn from a multitude of open and propriety data sources.

EQ Amplify is a data product which plugs in directly to that database to deliver statistical insights direct to marketers. The product offers deep and dynamic segmentation, using machine learning, which allows the segmentation to accurately profile within the context of the entire UK, and remain objective to the output.

Unlike other geodemographic products, EQ Amplify is currently the only solution publicised as being fully GDPR-compliant and abiding by a Privacy-by-design policy. All consumers remain anonymous. The product statistically profiles segments of UK consumers, including demographic, socio-economic, psychographic and behavioural characteristics, and offers them via an interface, or in the form of a complete Data-index.

EQ Amplify gives marketers the potential to create a more holistic, three-dimensional view of their customers – with the added capability to further pinpoint target customer groups in corresponding segments from across the country.

Jamie Steele, Head of Data at EQ Data said, “This is a landmark event for marketers, who can now access the entire UK database, in a product designed for a fast-paced and rapidly-changing environment. EQ Amplify represents a major step forward for businesses to build more fulfilling transactional relationships with their customers.”

Stuart Robb, CEO of EQ Data and Chief Data Officer of Equiniti Plc concluded, “It is our belief that UK business should be driven by better relationships and it is rich data that can build better and more personalised relationships. With EQ Amplify we open up a powerful dataset to marketers – and, importantly, in a format in which they can rest assured that it meets all legal and regulatory requirements.

EQ Data seek to be at the forefront of data-driven business in the UK. With this in mind, we are delighted to launch EQ Amplify which helps positions the business front-and-centre in that market.“

POS consumer car finance volumes up by 6% in July

New figures released today by the Finance & Leasing Association (FLA) show that point of sale (POS) consumer car finance new business volumes grew 6% in July, compared with the same month in 2017, while the value of new business increased by 11% over the same period.

The POS consumer new car finance market reported new business in July up 5% by volume and 10% by value, compared with the same month in 2017. The percentage of private new car sales financed by FLA members through the POS was 89.8% in the twelve months to July.

The POS consumer used car finance market reported new business in July up 6% by volume and 13% by value, compared with the same month in 2017.

Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said: “The point of sale consumer car finance market reported new business volumes up by 4% in the first seven months of 2018, in line with expectations of modest single-digit growth in 2018 as a whole.”

Growing focus on compliance could leave businesses vulnerable to fraud

An increased focus on compliance risks detracting businesses from making investments to protect their organisation against fraud, according to new research by TransUnion (formerly Callcredit).

The research, part of which forms the Fraud Fortress report, revealed that compliance is the area most commonly expected to drive increased expenditure (64%), potentially at the expense of prevention or detection.

Whilst fraud leaders are also reporting increases in anti-fraud expenditure, as a result of investments in biometric technologies (59%), training employees to combat fraud (57%) and anti-fraud employee costs (56%), the biggest increase of investment has been in compliance.

Yet, findings from the CIFAS report ‘The Fraudscape’ suggest that the use of technology such as device recognition software, voice recognition and predictive analytics can help reduce opportunities for fraudsters. The decrease in fraud affecting bank accounts in 2017 has been attributed, in part, to banks successfully implementing these measures.

John Cannon, managing director, fraud and ID, TransUnion said: “With a rapidly evolving and increasingly stringent regulatory landscape, compliance needs to be a key focus for businesses. But as the fraud threat grows ever more sophisticated, they cannot afford for investments in technology and education to take a back seat. The risk of fines for non-compliance is often a major factor in determining investment priorities, yet the damage to reputation and loss of business that a serious fraud incident or data breach can bring about, may ultimately be much more costly.”

Encouragingly, businesses are increasingly recognising the importance of smart technology in the fight against cybercrime and looking to build greater intelligence into their technology solutions. According to TransUnion’s research, artificial intelligence (45%), machine learning (37%) and biometric screening techniques (37%) are being targeted as the top fraud prevention solutions over the next three years.
John continued: “Where to allocate investment is always a difficult decision. Spending on compliance and fraud prevention often go hand in hand, as both aim to protect the consumer, but finding the right balance is important and often difficult to achieve. To
ensure they are sufficiently protecting themselves and their customers from fraud, businesses should adopt a layered strategy, combining new technology with more traditional approaches.”