Wednesday, December 08, 2010

WikiLeaks Founder Says To Expect Major Leak Concerning Big U.S. Bank

Forbes: An Interview with Julian Assuage

CNN: Which Bank is WikiLeaks’ Target?
FDIC’s Bair: ‘Ignore’ WikiLeaks Bank Release
CNN Money: Wacky Wiki Won’t Wreck Bank Stocks

The news the last few weeks has been filled with mentions of WikiLeaks, the website that releases confidential and nonpublic documents. Most of that news has been filled with discussion concerning the website’s recent release of thousands of the United States’ State Department’s diplomatic cables. However, there is also some curiosity over information the website may have that could affect the United State’s private sector.

Julian Assuage, the founder of WikiLeaks, sparked this curiosity in a recent interview with Forbes. While discussing the massive nature of the cables leak, Assuage mentioned that the website had enough information for another major leak, and this one would be the website’s first leak concerning the private sector. Assuage stated that about half of the website’s documents concerned the private sector and hinted that the website’s next major release, scheduled for early next year, would target one of the biggest banks in the United States. Assuage said that the information was of such a nature that it would “take down” the bank.

Although evasive on the actual contents of the documents that the website will release, Assuage mentioned that the leaks would detail the inner workings of the bank and likely spark even more investigation and reform within the financial sector. Assuage likened the bank’s atmosphere to “an ecosystem of corruption.” Assuage alluded that there were definite ethical violations occurring within the bank, as well as possible criminal actions, and he predicted that it will cause a scandal of Enron-like proportions.

Assuage’s comments have ignited wide speculation regarding on which bank the WikiLeaks’ has such condemning information. Most commentators think the likely candidates are Wells Fargo, Wachovia, Citibank, JPMorgan Chase, and Bank of America. However, the media has speculated that one bank in particular is the likely subject of the controversy, because of Assuage’s previous comments. Last year, Assuage mentioned to an interviewer from Computerworld that WikiLeaks had five gigabytes of information from a Bank of America executive’s computer. Bank of America’s stock is already suffering from Assuage’s comments. On Tuesday, shares fell more than 3% and ended pennies above their lowest price of the past year.

The head of the FDIC, Sheila Bair, downplayed Assuage’s comments. She suggested consumers simply ignore his remarks and rumors of an upcoming leak. Bair stated that since the financial crisis the transparency of the banking industry has increased. Bair was also skeptical that Wikileaks could have any major information about the financial sector and banking industry that has not already been previously released. Time will tell what kind of impact these WikiLeaks could have on the private sector. If Assuage is to be believed, there will be at least some impact, and we probably won’t have to wait long.

1. Do you think Assuage has the kind of information that could cause another Enron-like scandal or is Bair’s statement that there isn’t any further and unknown information more accurate?
2. If WikiLeaks does have such information, what kinds of reform would you expect?

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