Independence Day was Sunday, but the fireworks started a couple days early when it was revealed that Charles Schwab was setting aside $200 million in the second quarter for an ongoing SEC probe into “historic disclosures” regarding the brokerage’s robo advisor. While Schwab notes the final amount might be different, and it’s not yet clear what exactly the SEC is worried about, $200 million is still a stunning amount.
Also this week, we had a dive into why Lori Hardwick, one of the most prominent women in wealthtech, quietly left Riskalyze’s board of directors. It looks like continued fallout from Riskalyze’s controversial marketing campaign in May, and some are wondering what it means for the firm’s ability to land enterprise contracts with large wealth management firms. And with Morningstar jumping into the risk assessment game, this story likely isn’t done yet.
My two cents: it’s a bit strange that Riskalyze is taking more heat for calling out its competition’s methodologies — I wish more fintech firms would clearly explain why advisors should choose their product over something else on the market — than HiddenLevers is for using anti-Asian rhetoric in a webinar. ¯\_(?)_/¯
Meanwhile, a Russian hacker group calling themselves REvil initiated a widespread ransomware attack that hit as many as 1,500 small business. The hackers are demanding $70 million to unlock computers they have seized. If you’ve been on vacation, the Wall Street Journalhas a good explainer.
In an unrelated event that hits closer to home, Morgan Stanley has disclosed a data breach that exposed names, dates of birth and Social Security numbers of some customers.
Both stories are a growing reminder of how important cybersecurity is in wealth management, even though advisors don’t like to think about it. I know this because I can see how little traffic our cybersecurity stories get. It’s ok! I get it! You’d rather be finding new clients or golfing with current ones than worrying about complicated IT issues that not even a giant like Morgan Stanley can solve.
But the head-in-the-sand approach isn’t sustainable. So I’d love to hear from readers — what sort of cybersecurity stories would you like to read? What questions do you have, and what are you sick of hearing?
Let’s work together to improve cybersecurity awareness throughout the industry.

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