We need to keep people from losing their homes. Here’s how we do it. Cancel rent and mortgage payments in California to prevent a wave of evictions

There’s no way around it: Sheltering in place is the only way to slow the spread of COVID-19. But social distancing demands a rare suite of opportunities and resources. Right now, millions of Californians living paycheck to paycheck, without the ability to work remotely, face impossible choices: stay home and risk losing everything, or make an income and risk spreading the virus? Pay for housing, or pay for food? When we finally “return to normal” and temporary relief efforts lift, responsible Californians stand to lose the very homes in which they sheltered. Unless we take action, the oncoming tsunami of evictions and foreclosures will eclipse even the darkest days of the Great Recession.

The solution is clear: we must cancel rent and mortgage payments in California. Here’s how we get that done.

First, we must acknowledge that fewer than one in three Americans can make an income working from home, and disparities break along racial and socioeconomic lines. Just under 20% of Black people and a mere 16% of Latinos have the privilege of working from home. For those without a college degree, that number is just 4%. While Unemployment Insurance claims have spiked to a record-high, surpassing the peak of California’s unemployment during the Great Recession, millions more have lost income with little or no recourse. Many will lose their jobs permanently.

Second, we must be clear that current policy in California provides no meaningful protection in the long-term. There is a temporary forbearance on mortgage payments for some — but not all — property owners. Those who cannot pay now must pay later. For renters, Governor Gavin Newsom’s “eviction moratorium” merely delays the inevitable. Anyone who can’t make rent during the shelter-in-place order will remain liable for back-rent, or face eviction after protections are lifted. Different counties across the state provide different grace periods before tenants will be subject to eviction. Mapping the legal patchwork the Governor has left to his 18 million renting constituents is disorienting, especially considering many lack the resources to secure legal representation.

Third, the current federal stimulus package won’t meet the needs of Californians. For Bay Area residents, a one-time payment of $1,200 will barely cover rent for a single bedroom.

Here’s what Newsom and the California Legislature need to do: Immediately issue an emergency declaration cancelling rent and mortgage payments for tenants and homeowners who have been hit by COVID-19 and/or its economic impacts for as long as the state of emergency is in place. And, if mortgage relief cannot be renegotiated with lenders, allow small landlords to deduct lost rent from their mortgage payments. This can be done using a simple, equitable formula: Total suspended rent payments, divided by total payments typically owed through the suspension period, multiplied by mortgage payments through the suspension period.

Under this formula, a landlord with a $5,000/month mortgage will have $15,000 of their mortgage forgiven over a three month suspension period if their tenants can’t pay any amount of rent. A landlord with the same mortgage and rent rate will be forgiven $7,500 over the same period if their tenants can only pay 50% of the rent.

While the California State Legislature has been out of session since March 16th, New York lawmakers remain hard at work virtually debating a bill to cancel rent and the above formula for mortgages. Here in San Francisco — where the Board of Supervisors has canceled its recess to continue legislating — Supervisors Matt Haney and Hillary Ronen recently held a joint press conference with other local elected officials from major cities to call for a federal and statewide rent and mortgage moratorium.

Even a month ago, the scope of this project might have sounded impossible, but the challenges of a global pandemic have unleashed our imaginations, and inspired dramatic solutions. Millions of Californians have retreated into their homes indefinitely. All but essential businesses have shuttered. Once bustling streets sit desolate. This time last year, the enormity of our action would have been unimaginable — the stuff of science fiction — but extraordinary threats demand extraordinary solutions. Now is the time to be bold.

Bending the curve is a collective project of unprecedented scale and urgency. San Francisco and California have led the nation in our public health response by taking early, ambitious action. Now we must again emerge as national leaders in our response to the coming eviction and foreclosure crisis. After years of local factionalism over housing, this common-sense policy should unite everyone. We need to keep people in their homes today, and ensure they don’t lose them tomorrow. Cancel rent and mortgages now.

The Student Loan Appeal Process the Government Doesn’t Tell You About

The Education Department has a powerful complaint resolution path that is kept largely out of sight.

In the deluge of complaints about a troubled program that pays off student loans for people who work in public service, one stands out for its frequency: Thousands of people say they were misled by loan servicers working on the U.S. government’s behalf.

It is among the most vexing problems with a program that has become a notorious quagmire, with a rejection rate of nearly 99 percent. Lawmakers, consumer advocates and desperate public servants say the Education Department should create a formal process to appeal denials, especially rejections that borrowers say were affected by mistakes made by servicers.

But it turns out the Education Department already has a system for investigating complaints and making fixes — it just keeps it very quiet.

At a training conference for financial aid professionals in December, a program specialist at the Education Department said during a presentation that if the agency finds out that it or the servicers it hires “did something wrong,” it will “hold the borrower harmless as a result.”

Those who think they have been harmed by a servicer’s error should file a complaint explaining what happened through the Federal Student Aid office’s feedback system on the StudentAid.gov website, the specialist, Ian Foss, said during his presentation. That routes complaints to the agency’s Ombudsman Group, and the department will then investigate and try to confirm the borrower’s account.

That startled many in the room.

“I was legitimately surprised,” said Ryann Liebenthal, a journalist who is writing a book on student debt and asked the question that prompted Mr. Foss’s answer. She had never before heard of the department’s dispute system.

But the agency has investigated hundreds of borrowers’ claims and found that they were given inaccurate advice or otherwise victimized by a servicer’s error, according to agency records and interviews with current and former government officials. After verifying their claims — using any records it could get, including the call recordings that most servicers keep — the department adjusted those borrowers’ accounts using what is known internally as an “override” credit.

Yet few borrowers know about the appeals process — and even government auditors think that’s a problem.

In a report last year, the Government Accountability Office found that “there is no formal process for borrowers who are dissatisfied” to challenge decisions and that the Education Department does not fully inform borrowers about their appeal options, including the Ombudsman Group.

The obscurity is intentional: The Education Department does not prominently advertise the feedback system because the manual investigations are time-consuming, according to three people familiar with the matter.

That frustrates advocates for borrowers. READ MORE:

Last Tax Season Was a Mess. Now’s Time to Prepare for This One.

If you didn’t change the tax withholding in your paycheck, you still have time to avoid another unpleasant surprise — or even a fine.

The first tax season under the Republican-sponsored overhaul brought an odd combination of pleasant and unpleasant surprises: lower tax burdens, but also lower refunds — and, for some, an unexpected bill.

Anyone who didn’t take a proactive approach after getting a big tax bill last time around could end up in that situation again, only worse: That filer is more likely to have to pay a penalty.

For 2019, taxpayers who didn’t generally withhold at least 90 percent of their liability from their paychecks may be required to pay a fine. That threshold is back up from 80 percent, where it was set last year as everyone adjusted to the new rules.

If you didn’t change your withholding by filling out a new W-4 form with your employer, there are still steps you can take to try to avoid the extra charge.

If a withholding calculator — like the one on the Internal Revenue Service’s website — shows you’re significantly short, you have options. There may be time to have an extra amount withheld from your final paycheck to get you over the threshold, although that will require filling out a W-4 now and another later to reverse that change. Or you can make what’s called an estimated tax payment directly to the I.R.S.

You’ll also want to think about how to handle the rest of the tax balance.

“You can start planning for that now by setting aside money in savings accounts or planning ahead for an installment agreement with the I.R.S. so you can pay over a period of time,” said Nathan Rigney, lead tax research analyst at H&R Block’s Tax Institute.

Most households did pay a bit less because of the overhaul: Individuals’ total tax liability dropped nearly 5.8 percent, or $70 billion, according to I.R.S. data on tax returns filed through July.

But it didn’t feel that way for some taxpayers. The number of refunds issued hardly budged — they were down 0.3 percent — but refunds for many were smaller. Refunds for those who earned between $100,000 and $250,000, for example, dropped by about 11 percent, according to the I.R.S.

Many people were surprised to learn that they owed the government money even if their situation hadn’t changed.

“She Lied to My Face”: Inside the Hectic Last Days of Gymboree’s Retail Bankruptcy

Mera Chung had known for weeks that her 30-year career in retail was coming to an end. But Chung, a vice president of design for Crazy 8, a division of Gymboree Group Inc., wasn’t prepared for what CEO Shaz Kahng and human resources chief Bridget Schickedanz would tell her late on a Wednesday afternoon in mid-January.

They had called Chung in to inform her of an imminent bankruptcy filing, Gymboree’s second in two years, which would accompany the liquidation of two of the company’s three brands, including Crazy 8, which caters to lower-income parents. Chung was ready for that; the closure of Crazy 8 was announced in December, and the bankruptcy was long rumored. But then Schickedanz dropped the bomb.

“She said, ‘We had to make some other decisions and you’ve been impacted,’” Chung explains. “‘We had to terminate the severance plan.’”

The severance plan, according to Chung and two of her close friends, was a key reason why she decided to move to Gymboree from Old Navy five years earlier. The retail sector’s volatility has boiled over recently, with rapid-fire bankruptcies and store closures emptying malls across the country, much of it driven by private-equity firms busting out otherwise profitable companies. But Chung, a single parent caring for an elderly father, came to Gymboree because she knew she’d be due a year’s worth of salary if the company ever went belly-up.

Instead, on the same day as the bankruptcy filing, Gymboree’s board triggered Article VII of the severance plan, a self-destruct button that enabled the company to terminate the plan “at any time in any respect” via a majority vote from the board of directors. As a result, none of the roughly 400 staff members at Gymboree headquarters in San Francisco would receive severance, to say nothing of the nearly 10,000 clerks at 800 Gymboree and Crazy 8 locations, who would now be managing going-out-of-business sales without the promise of assistance in the aftermath.

Kahng told Chung that there just wasn’t enough cash available to pay severance. But Chung said she had information, which she would later share with the U.S. bankruptcy trustee overseeing the case, that at least a few executives would leave Gymboree with golden parachutes.

A few weeks earlier, she had learned about a confidential deal between the board and eight members of Gymboree’s executive leadership team. According to Chung, those executives received paper checks with a “retention bonus” equal in value to their severance payouts. The board, which includes representatives from hedge funds and private equity firms, told the executives to deposit the checks immediately. Bankruptcy experts often call this type of payment a “disguised severance.”

Chung heard this firsthand from one of the bonus recipients. Chung had an equivalent title to most of the members who she was told received the bonuses, but she was left out. She would later tell the bankruptcy trustee in a letter that she watched as four of those bonus recipients jetted off to the Sundance Film Festival, just days after Gymboree declared bankruptcy.

In the meeting, Chung had asked, “What about the retention bonuses the others have, including you?” referring to Schickedanz, a member of the executive leadership team. Kahng would only reply, “That is not an appropriate question and I will not comment on it.”

Chung said she had replied, “The answer is what’s not appropriate.”

Gymboree, founded in 1976, is on its way to history. Children’s Place, a rival retailer, paid $76 million for the rights to the Gymboree and Crazy 8 brands, and the Gap is purchasing Gymboree’s 139-store luxury chain, Janie and Jack. But the disguised severance maneuver Chung has alleged reveals how in corporate America, the winners at the top can win even in failure. And nobody else is safe — certainly not the line-level workers, but not even vice presidents like Mera Chung.

The Intercept has reviewed documents confirming the termination of the severance plan on the day of the bankruptcy. Chung made her allegations about the disguised severance to friends, attorneys, and bankruptcy officials in the weeks after Gymboree’s filing, according to interviews and documents. And Julie Thompson, a vice president of product integrity and compliance for Gymboree, also said in a separate interview that bonus payouts were made to the executive leadership team.

Moreover, Chung alleged to the trustee that Gymboree underreported the extent of the retention bonus payments in a filing with the bankruptcy court. In that filing, Gymboree acknowledges “discretionary bonus payments of $270,000 to two employees,” but Chung asserts that eight executives received bonuses totaling an estimated $2.1 million.

Gymboree, its executives, and board members have failed to respond to numerous requests for comment through email, phone, and LinkedIn. Calls to the company’s media relations department have gone directly to voicemail. Three calls to personal cellphones of members of Gymboree’s executive leadership team were answered, but the individuals refused to comment.

The situation at Gymboree echoes other recent retail bankruptcies in which executives got a king’s ransom while everyone else got a firm handshake. Toys “R” Us and Sears were approved for millions in executive bonuses, a fact that has enraged advocates for line-level workers. “These are the same handful of people who couldn’t run our company successfully, and they’re being rewarded while everyone’s severance is taken away?” asked Lily Wang, deputy director for Organization United for Respect’s Rise Up Retail campaign.

You can make a case for retention bonuses for top executives in some bankruptcies. They are usually justified as a way to keep the leadership from decamping to other jobs as soon as the bankruptcy is filed. “The rationale is by giving good people retention bonuses so they will stay, the company will have much greater likelihood of reorganizing and getting back on its feet,” said Brett Weiss, a bankruptcy attorney in Maryland.

But in this case, Gymboree was knowingly liquidating most of its business before the bankruptcy was ever filed, making retention bonuses less urgent. “This was a liquidation chapter 11, the executives are not going to be in these positions a year from now,” Weiss said. “Maybe they said, ‘How can we get more money out without having the trustee claw it back? What’s the greatest number of people we can do this for without raising red flags? How about the executive leadership team?’” Gymboree’s lawyers in the bankruptcy case did not respond to a request for comment.

Moreover, while some executives do need to be in place to wind down operations, the alleged bonuses were not uniformly given to executives who had that role. For example, the VP of marketing allegedly got a bonus, even though marketing operations effectively ceased. Meanwhile, Thompson’s job involved regulatory compliance, which any retailer still selling products (even in a going-out-of-business sale) needs to maintain. Yet she was denied a bonus and fired without severance.

The situation has left Chung devastated. “Me and this other woman were the altar sacrifices for the others to get paid,” she says. “People have to understand how vulnerable they are.”

Chung was recruited to Gymboree five years ago by her former boss at Old Navy, where she was the vice president of kids and baby clothing design. She was told that she would have the run of an entire brand, the low-price Crazy 8. “It was their only brand that was relevant,” Chung says. She took the job.

At the time, Gymboree was under the control of Bain Capital, Mitt Romney’s old private-equity firm. The private-equity business model involves engaging in buyouts with borrowed money and putting that mountain of debt on the company it purchases, all the while extracting profits from the company through management fees. Few companies, particularly in the high-risk retail sector, can deal with such a debt burden — it makes it difficult to invest in stores, personnel, or better products.

Chung says this showed in how Gymboree ran the business. “Instead of investing in creative talent, they promoted design and merchandising from within,” she says. “Merchandisers became complacent with wanting product they knew would sell from the year before. There were years upon years of awful clothes with poodles and trucks on them.” She also complains that Crazy 8 had no marketing budget, and her work to break with standard fare was practically hidden.

By 2017, Gymboree couldn’t hold out any longer and went into bankruptcy. The business was put in control of its largest creditors, who were private equity and investment firms. The seven-member board included then-CEO of Gymboree, Daniel Griesemer; Ron Beegle, CEO of investment consultant Carriage House Capital Advisers; Matt Perkal, a partner at hedge fund Brigade Capital Management; Brian Hickey from mutual fund firm OppenheimerFunds; and Eric Sondag, a partner at private-equity firm Searchlight Capital, who was made board chair. Other members of the board were not disclosed, and since Gymboree is not a public company, they have no requirement to do so. Apollo Global Management, Marblegate, Nomura Securities, and Tricadia Capital Management also had a share of the company.

Though Gymboree emerged from bankruptcy in decent financial shape, Thompson described the new board as uninterested. “There was zero involvement in what was going on day to day,” she says. “They just let the CEO do whatever he wanted.”

Griesemer decided to invest in a complete redesign of Gymboree’s clothing line. It was a high-cost gamble off the bankruptcy, and it failed; when the new clothes hit stores last summer, parents called them “complete garbage.” Says Thompson: “I started paying attention to sales, and I was like, ‘Oh my god, this is so bad.’ It was negative 20 to 30 percent [compared to the previous year] every single day.”

By November, Griesemer was fired, and Kahng, the new CEO, came in. She had started her career as a food scientist at Kraft and was an independent member of the board prior to being named CEO, according to her LinkedIn page.

“She thought they were going to try to rehab the brand, that this was her career-defining moment,” Chung says. She described one meeting in which Kahng pronounced that Gymboree needed to be a “disruptor” like Apple. “She said, ‘What does every parent experience?’” Chung recalls. “‘Every parent in the world feeds their child strained carrots. When my children were babies, there were carrot stains on everything. We could do something so simple, an orange bib.’ She was 100 percent serious. I barely got through the meeting.”

The disruption didn’t take. By early December, the company announced that it would shutter all Crazy 8 stores after the holidays and significantly reduce the Gymboree footprint. Chung says that in the month after the announcement, Kahng never formally addressed Crazy 8 employees, leaving them confused about their roles. If the brand was closing, there was no need to design or purchase product for the next season. “My team of 20 said, what do we do?” Chung recalls. “They said keep showing up until further notice. They didn’t want to let us go because then they would have to pay severance.”

The Gymboree management severance plan was not a package negotiated individually. It was an employee benefits plan, established under the auspices of the Employee Retirement Income Security Act. This has become popular, particularly with large companies, says Jim Keenley, an ERISA attorney in Berkeley, California. The statute provides protections to workers if they aren’t given what’s promised in the severance plan. It offers no protection, however, if the plan is terminated.

“It’s an illusory contract,” says Keenley. “It’s very common for severance plans to have language in them that say, here’s your severance but we can take it away at any time for any reason.” No advance warning is needed for termination, under current law. While retirement benefits under ERISA are better protected, severance plans are considered a welfare benefit, and the funds do not vest.

So employees have no recourse if a termination occurs. And most of them don’t read the fine print allowing companies like Gymboree to pull that trigger. “I didn’t have anyone look at it,” says Thompson. “I was naïve.”

Both Thompson and Chung were told after the 2017 bankruptcy that the severance plan remained active. And both sought further assurances after it was clear that Gymboree would slide into bankruptcy again. Chung says she had asked three colleagues — the general counsel, the VP of human resources, and the general manager of her brand, Crazy 8 — whether her severance would be honored. None gave a straight answer. But Thompson said that when she approached the general counsel, Kimberly MacMillan, in early January, MacMillan reassured her, “Don’t worry, we will file it as a first-day motion.”

In bankruptcy-speak, MacMillan was saying that the severance plan would be one of the payouts that Gymboree would seek to get approved when it filed. Pending court approval, all employees eligible for the severance plan would be compensated. The severance plan was approved in the 2017 bankruptcy, so Thompson trusted MacMillan that the same would happen the second time around. “I had good working relationship with [MacMillan],” Thompson says. “She fucking lied to my face.”

MacMillan, in a short phone call with The Intercept, said that “we [Gymboree employees] follow a strict no-comment policy” with the media, and hung up.

Around the same time, Chris Lu, general manager of Crazy 8, was commuting home with Chung. “She would always disclose things to me, she would blab them to me,” Chung says. In her letter to the trustee, Chung writes that Lu told her that members of the executive leadership team were “paid their severance,” after demanding assurances from the board of directors. The board arranged for a “retention bonus contract” in the amount of the severance pay. “She said I couldn’t tell anyone about it,” Chung recalls. “I said, ‘Why did you tell me that if I cannot say anything?’”

In a brief phone conversation with The Intercept, Lu would only say, “I can’t talk to you. … I’m going to hang up now.”

According to Chung’s trustee letter, members of the executive leadership team who may have received retention bonuses included Lu, MacMillan, Schickedanz, Chief Financial Officer Jon Kimmons, VP of Information Technology David Sondergeld, VP of Logistics Dana Todorovic, VP of Sourcing Patricia Lesser, and VP of Marketing Parnell Eagle. Those in the “next level down” like Chung were left out, even though she had the same VP title as several of the recipients. Chung and Thompson were not formally part of the executive leadership team.

Thompson had also heard about the not-so-secret retention bonuses. “Nobody officially told me, but I heard rumors,” she says. She talked it over with Chung just before the bankruptcy. But when Thompson asked MacMillan about the executive leadership team meeting with the board, MacMillan told her that she couldn’t comment on it.

Both Thompson and Chung were told about the severance termination on the same evening. That day, everyone in the office figured out who was being let go, because human resources had cleared out the layoff victims’ time-off balance from the payroll processing system. “Everyone compared notes, mine’s not cleared out, mine is,” Thompson says. “Everyone zeroed out is going to get let go. Mine was zeroed out at end of Wednesday.”

Thompson was told by phone that she would be terminated without severance. Kahng, who as CEO was also a member of the board, told her that “it wasn’t our decision. Goldman Sachs is running the show now, we couldn’t do anything about it.”

Goldman Sachs was the lead creditor on Gymboree’s remaining loans, which it used for cash flow. The investment bank was the first in line to get paid from the bankruptcy. “It’s like when you get on an airplane — Goldman was group 1,” says Chung.

The next day, staff was packed into a tiny conference room. Chung decided to wear a vintage Sex Pistols T-shirt to the meeting with the words “No Future” scrawled on the front. Schickedanz, the human resources chief, read a prepared statement through tears. Everyone had to turn in their ID badges, laptops, and corporate credit cards, and vacate the building by the end of the day. Employees would get their last paycheck and paid time off, and that was it.

Schickedanz, in a phone call with The Intercept, said, “Oh, I thought you were someone else calling. … I’m going to jump off [the phone],” and hung up.

One employee, Katherine Pocrass, filed a class-action lawsuit against Gymboree, alleging that the company did not provide 60 days’ advance notice of the mass firing, as required under the Worker Adjustment and Retraining Notification Act. Attorneys for that case did not respond to a request for comment.

The WARN Act case is ongoing, and Chung would be eligible to be a member in the class-action, which could yield up to 60 days of back pay. But her severance was for a year.

Chung says she met with 17 different attorneys seeking legal recourse for her full severance. Each of them said that while Gymboree’s actions were unconscionable, they were technically legal; the severance plan entitled the company to terminate at any time. Eugene Pak, a business litigator in the Bay Area, said that the situation struck him as “unethical.” Added Keenley, the ERISA attorney: “I think Mera felt that it was unfair. … I’ve been looking for ways to find that it was not lawful, but I have not found them.”

Ron Tyler, a friend of Chung’s and a law professor at Stanford, provided her with several legal contacts. “I think her devastation comes from the fact that she, after very carefully and persistently creating this extremely successful career, to have it end so dramatically and intentionally by her company,” Tyler says. “And she saw the writing on the wall. Had it not been for that [severance] agreement, she would have left before.” Shortly after the bankruptcy, Chung felt an even deeper sting. One of the lawyers she consulted asked how many employees worked at Gymboree headquarters, and so Chung put the question to Lu. “She was laughing and said, ‘I’ll call you when I land, I’m going to Sundance,’” Chung says. Chung wrote to the trustee that Lu and three other members of the executive leadership team — Tricia Lesser, Shelly Walsh, and Parnell Eagle — had decamped to the Sundance Film Festival, weeks after being given a retention bonus to stay on at Gymboree. Thompson corroborated that Gymboree executives were at Sundance, though she didn’t name names. READ MORE: https://theintercept.com/2019/03/25/gymboree-bankruptcy-severance-scam/

The great Equifax mystery: 17 months later, the stolen data has never been found, and experts are starting to suspect a spy scheme

Equifax’s data breach on Sept. 7, 2017, stunned markets and American consumers, but where the data of those 143 million people disappeared to has remained a mystery.
CNBC talked to experts, intelligence officials, dark web data “hunters” and Equifax to discover where they expect the data has gone, and what it is being used for.
The prevailing theory today is that the data was stolen by a nation-state for spying purposes, not by criminals looking to cash in on stolen identities.

On Sept. 7, 2017, the world heard an alarming announcement from credit ratings giant Equifax: In a brazen cyberattack, somebody had stolen sensitive personal information from more than 140 million people, nearly half the population of the U.S.

It was the consumer data security scandal of the decade. The information included Social Security numbers, driver’s license numbers, information from credit disputes and other personal details. CEO Richard Smith stepped down under fire. Lawmakers changed credit freeze laws and instilled new regulatory oversight of credit ratings agencies.

Then, something unusual happened. The data disappeared. Completely. CNBC talked to eight experts, including data “hunters” who scour the dark web for stolen information, senior cybersecurity managers, top executives at financial institutions, senior intelligence officials who played a part in the investigation and consultants who helped support it. All of them agreed that a breach happened, and personal information from 143 million people was stolen.

But none of them knows where the data is now. It’s never appeared on any hundreds of underground websites selling stolen information. Security experts haven’t seen the data used in any of the ways they’d expect in a theft like this — not for impersonating victims, not for accessing other websites, nothing.

But as the investigations continue, a consensus is starting to emerge to explain why the data has disappeared from sight. Most experts familiar with the case now believe that the thieves were working for a foreign government and are using the information not for financial gain, but to try to identify and recruit spies.

One data hunter dives in

The missing Equifax data has been a 17-month-long obsession for Jeffrey, a cybersecurity analyst at one of the world’s largest banks. To him, it represents a sort of professional Lost City of Atlantis or Holy Grail.

Jeffrey is not the analyst’s real name. He asked to remain anonymous because he was not authorized to speak to the media. He also asked that his bank remain anonymous, because he’s one of such a narrow pool of a specific type of employee that even the name of his bank could be used to identify him.

Jeffrey is a “hunter” on the bank’s “hunt team,” and his job is searching for data on the dark web or darknet — a set of web sites that can only be accessed with special software that protects the user’s anonymity. The dark web can be used for many purposes, but most prominently serves as the internet’s underground black market, where criminals buy, sell and trade credit card data, personal information and criminal services.

Jeffrey trolls the dark web for stolen personal data that looks like it might be brand new, especially if it looks like it might belong to customers of the bank or its rivals. He is often one of the first to know that another company has been breached, and his team is often among the first to inform the victims that their systems have been breached.

So Jeffrey was surprised when he learned about the Equifax breach at the same time as everybody else, when the company announced it to the world.

Stolen consumer information usually goes up for sale immediately after a company is hacked, he explains. Criminals aim for speed so they can sell the data before a company’s tripwires ever detect it was stolen. The longer they wait, the more likely the victims and the institutions will make changes to render the data useless. This is especially true with credit card numbers, which can quickly be canceled once fraudulent charges start cropping up on them. Or when Social Security numbers — like those stolen in the Equifax breach — start getting flagged for fraud.

What to Do With Your Money in 2019 According to Financial Advisors

Money mistakes are a dime a dozen. Except, you know, they end up costing us a bit more than that.

Think More Critically About Your Resolutions

To prevent those costly financial blunders, we asked some financial advisors and professionals what clients tend to get wrong—and you should do differently going into 2019.

Don’t make News Year’s Resolutions. They don’t work.

Set your goals now, or in early January (after the holiday). The goals need to be realistic. This is key. If they are too hard or not remotely achievable, most folks give up before they even start. When setting goals, start small, then move up. For example, if you are contributing three percent to your 401(k) plan, increase it to four percent. Then plan six to nine months down the road to increase it to five percent.

Similarly, if your cash reserve fund is only one month’s living expenses, give yourself a period of time, say six months, to [get to] two months’ living expenses.

Small steps that are actually implemented have a much higher chance of staying implemented. Then you can go from there and again, slightly raise the goal.

The other thing people need to do is check in with their goals. This doesn’t mean following every movement in the stock market. This means reviewing your progress. This should be quarterly.

Pay Yourself First

The tumultuous markets sometimes cause people to quit contributing to their retirement plans, when we should do the opposite and continue to defer into our 401(k) or other retirement plans. If you are worried about volatility, you should still contribute, especially if you are many years away from retirement. Markets have historically gone through periods of decline and subsequently recovered.
READ MORE: https://twocents.lifehacker.com/what-to-do-with-your-money-in-2019-according-to-financi-1830992314?utm_source=pocket&utm_medium=email&utm_campaign=pockethits

WeWork’s Rise: How a Sublet Start-Up Is Taking Over

Critics have derided WeWork as overvalued and vulnerable to the next downturn. But the company holds so many leases in so many cities, it might hold more power than its landlords.

Real estate titans have long scoffed at WeWork, which in eight short years has managed to attain a $20 billion valuation by selling short-term leases for shared office space with a mixture of stylish design and free-flowing alcohol.

Derided by some as a real estate company masquerading as a technology company, it has been called everything from a “$20 billion house of cards” to a “Ponzi scheme.”

The naysayers argue that WeWork’s business model looks brilliant only in a rising economy that has allowed it to lock in long-term leases and then re-rent that space to other businesses at a premium. The enormous valuation it has obtained is higher than that of Boston Properties and Vornado, two of the country’s biggest office-space landlords — companies that actually own the kind of space that WeWork usually rents.

Now, with interest rates creeping higher, residential real estate prices flattening and fears of an economic slowdown coming, real estate insiders are gleeful at the notion that a downturn could be an existential threat for the company.

But a funny thing happened as WeWork has scaled up all over the globe: It may have become too big to fail.

WeWork has gobbled up leases for so much space in so many cities, there’s a compelling case to be made that its landlords wouldn’t be able to afford for it to go under.

Because of WeWork’s size, “they have more power in a down market,” said Thomas J. Barrack Jr., the longtime real estate investor and founder of Colony Capital.

The company is scheduled to release third-quarter financial results on Tuesday. A WeWork spokesman, citing the coming report, declined to comment.

The conventional wisdom is that when the economy turns south, WeWork’s customers — many of which are start-ups and may be the most vulnerable — will simply walk away. The flexibility of WeWork’s short-term leases is part of its appeal, after all.

Uber, Lyft and the Urgency of Saving Money on Ambulances

‘Don’t reflexively call an ambulance,’ a Harvard researcher says. In many cases, a cheaper way makes sense.

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An ambulance ride of just a few miles can cost thousands of dollars, and a lot of it may not be covered by insurance. With ride-hailing services like Uber or Lyft far cheaper and now available within minutes in many areas, would using one instead be a good idea?

Perhaps surprisingly, the answer in many cases is yes.

The high cost of an ambulance isn’t really for the ride. It comes with emergency medical staff and equipment, and those can be very important, of course, even lifesaving.

But they are not things you always need, although you (and your insurer) pay for them with every trip.

“Don’t reflexively call an ambulance,” said Anupam Jena, a physician and researcher with the Harvard Medical School. “Ambulances are for emergencies. If you’re not having one, it’s reasonable to consider another form of transportation.”

Why Is College in America So Expensive?

The outrageous price of a U.S. degree is unique in the world.

college ripoff Before the automobile, before the Statue of Liberty, before the vast majority of contemporary colleges existed, the rising cost of higher education was shocking the American conscience: “Gentlemen have to pay for their sons in one year more than they spent themselves in the whole four years of their course,” The New York Times lamented in 1875.

Decadence was to blame, the writer argued: fancy student apartments, expensive meals, and “the mania for athletic sports.”

Today, the U.S. spends more on college than almost any other country, according to the 2018 Education at a Glance report, released this week by the Organization for Economic Cooperation and Development (OECD).

All told, including the contributions of individual families and the government (in the form of student loans, grants, and other assistance), Americans spend about $30,000 per student a year—nearly twice as much as the average developed country. “The U.S. is in a class of its own,” says Andreas Schleicher, the director for education and skills at the OECD, and he does not mean this as a compliment. “Spending per student is exorbitant, and it has virtually no relationship to the value that students could possibly get in exchange.”

Only one country spends more per student, and that country is Luxembourg—where tuition is nevertheless free for students, thanks to government outlays. In fact, a third of developed countries offer college free of charge to their citizens. (And another third keep tuition very cheap—less than $2,400 a year.) The farther away you get from the United States, the more baffling it looks.

This back-to-school season, The Atlantic is investigating a classic American mystery: Why does college cost so much? And is it worth it?

At first, like the 19th-century writer of yore, I wanted to blame the curdled indulgences of campus life: fancy dormitories, climbing walls, lazy rivers, dining halls with open-fire-pit grills. And most of all—college sports. Certainly sports deserved blame.

On first glance, the new international data provide some support for this narrative. The U.S. ranks No. 1 in the world for spending on student-welfare services such as housing, meals, health care, and transportation, a category of spending that the OECD lumps together under “ancillary services.” All in all, American taxpayers and families spend about $3,370 on these services per student—more than three times the average for the developed world. One reason for this difference is that American college students are far more likely to live away from home. And living away from home is expensive, with or without a lazy river. Experts say that campuses in Canada and Europe tend to have fewer dormitories and dining halls than campuses in the U.S. “The bundle of services that an American university provides and what a French university provides are very different,” says David Feldman, an economist focused on education at William & Mary in Williamsburg, Virginia. “Reasonable people can argue about whether American universities should have these kind of services, but the fact that we do does not mark American universities as inherently inefficient. It marks them as different.” READ MORE:https://www.theatlantic.com/education/archive/2018/09/why-is-college-so-expensive-in-america/569884/