Bank robbery

Bank robbery is the crime of robbing a bank. It is also called Bank Heist especially in the United States. It is usually accomplished by a solitary criminal who brandishes a firearm at a teller and demands money, either orally or through a written note. The most dangerous type of bank robbery is a takeover robbery in which several heavily armed (and armored) gang members threaten the lives of everyone present in the bank. A bank robbery can also take place during off hours when thieves try to break into the vault and get away with money.
According to the Independence Hall Association in Philadelphia, the first bank robbery in America happened during the night of August 31 or the early morning of September 1, 1798 at the Bank of Pennsylvania at Carpenters' Hall. The vaults were apparently robbed of $162,821, or approximately $1.8 million in 2006 dollars. Because no forced entry evidence existed, authorities assumed it was an "inside" job. Several suspects were immediately imprisoned and prosecuted, but the real culprits were Isaac Davis and a partner. Within days of the heist, Davis' partner fell victim to a plague of yellow fever that ravaged Philadelphia that summer.
(Claims of notoriety aside, it is important to note that theft which lacks intimidation or threat of violent confrontation is not truly a robbery, but a burglary. These two concepts are often confused in common discussion of bank crimes.)
During the American Civil War, raiders from both Union and Confederate armies would rob banks in enemy-controlled towns. These robberies were at the time regarded as legitimate acts of war, but many of the raiders carried on robbing banks in the post-war era, giving rise to the famous robber gangs of the late 19th century.
Due to modern security measures like security cameras, armed security guards, silent alarms, exploding dye packs, and SWAT teams, bank robberies are now much more difficult. Few criminals are able to make a successful living out of bank robbery over the long run, since each attempt increases the probability that they will be identified and caught. Today most organized crime groups tend to make their money by other means, such as drug trafficking, gambling, loan sharking, identity theft, or online scamming and phishing. Bank robberies are still fairly common and are indeed successful, although eventually many bank robbers are found and arrested. A report by the Federal Bureau of Investigation [1] states that, among Category I serious crimes, the arrest rate for bank robbery in 2001 was second only to that of murder.
A further factor making bank robbery unattractive for criminals in the United States is the severity with which it is prosecuted. Accounts at all US banks are insured by the Federal Deposit Insurance Corporation, a corporation of the federal government, bringing bank robbery under federal jurisdiction and involving the FBI. Federal sentencing guidelines for bank robbery mandate long prison terms, which are usually further enhanced by the use or carrying of loaded firearms, prior criminal convictions, and the absence of parole from the federal prison system. As with any type of robbery, the fact that bank robbery is also inherently a violent crime typically causes corrections administrators to place imprisoned bank robbers in harsher high-security institutions.
Ever since the "glory days" of the great bank robberies during the 19th century, bank robberies have become ingrained into American popular culture. Numerous films, books, and songs have been written about the crime, which is the crime of choice for villains everywhere in comic books, pulp adventure and crime stories, and even cartoons. The incidence of bank robberies is less pronounced in many other countries despite less security. It is believed that the cultural differences may be the reason.

Top three changes in banking profitability

The top three changes affecting or detracting from a bank's profitability are the following:
Increasing overhead - primarily due to escalating real estate prices and health benefits increase.
Online lending - Non traditional banks have gained a foothold by leveraging the internet.
Mortgage Brokers - Mortgage Brokers have gained more than 70% of the mortgage origination market over the past decade. Mortgage Brokers sell originated loans primarily to large wholesale mortgage servicing companies which can offer sharply reduced mortgage pricing as they do not have the same high cost or overhead as a retail bank branch. Therefore a retail bank may be competitive in the mortgage lending field on a retail basis, but not able to offer a comparative wholesale program to mortgage brokers. Therefore the mortgage brokers often sell the bulk of originations to large mortgage servicing companies.

Bank mergers and brands

Some brands in the banking/financial services industry today are the result of a merger where the acquiring bank assumed the brand name of the bank it took over. This happened in the case of these mergers:
The Nations Bank/BankAmerica merger
The Norwest/Wells Fargo merger
The Firststar/US Bank merger
The Travelers/Citibank merger
The Chemical Bank/Chase merger
The Travelers Group/Citicorp merger
First Union/Wachovia merger
J.P. Morgan Chase/Bank One merger

Deregulation

Legislation passed by the federal government during the 1980s, such as the Depository Institutions Deregulation and Monetary Control Act of 1980 and the Garn-St. Germaine Depository Institutions Act of 1982, diminished the distinctions between banks and other financial institutions in the United States. This legislation is frequently referred to as "deregulation," and it is often blamed for the failure of over 500 savings and loan associations between 1980 and 1988, and the subsequent failure of the Federal Savings and Loan Insurance Corporation (FSLIC) whose obligations were assumed by the FDIC in 1989. However, some critics of this viewpoint, particularly libertarians, have pointed out that the federal government's attempts at deregulation granted easy credit to federally insured financial institutions, encouraging them to overextend themselves and (thus) fail.

The Federal Reserve System

The Federal Reserve Act of 1913 established the present day Federal Reserve System and brought all banks in the United States under the authority of the federal government, creating the twelve regional Federal Reserve Banks which are supervised by the Federal Reserve Board. Notwithstanding the Glass-Steagall Act of 1932 and the Banking Acts of 1933 and 1935, which were attempts to reform various banking abuses, the Federal Reserve System has remained more or less unchanged through to the present day. The Glass-Steagall Act was repealed in 1999, whereas the Banking Act of 1933 simply strengthened the supervisory powers of federal authorities and created the Federal Deposit Insurance Corporation.

The dual banking system

In 1863, Congress passed the National Bank Act in an attempt to retire the greenbacks that it had issued to finance the North's effort in the American Civil War. This opened up an option for chartering banks nationally. As an additional incentive for banks to submit to Federal supervision, in 1865 Congress began taxing any issue of state bank notes (also called "bills of credit" or "scrip") a standard rate of 10%, which encouraged many state banks to become national ones. This tax also gave rise to another response by state banks -- the invention of the demand deposit account, also known as a checking account. By the 1880s, deposit accounts had changed the primary source of revenue for many banks. The result of these events is what is known as the "dual banking system."

The dual system of banking has survived to this day. New banks may choose either state or national charters (a bank also can convert its charter from one to the other). Until 1989, banks with national charters (national banks) were required to participate in the FDIC, while State Banks either were required to obtain FDIC insurance by state law or they could voluntarily join it (usually in an attempt to bolster their appearance of solvency). After enactment of the Federal Deposit Insurance Corporation Improvement Act of 1989 ("FDICIA"), all commercial banks that accepted deposits were required to obtain FDIC insurance and to have a primary federal regulator (the Fed for state banks that are members of the Federal Reserve System, and the FDIC for "nonmembers").

The era of free banking

Prior to 1836, a bank could only be chartered by a legislative act. It has been speculated that this led to many abuses, with proprietors lacking connections in their legislatures being effectively barred from establishing banks.The dissoluting of the Second Bank of the United States in 1836 lead 18 states to establish clear rules for incorporation -- any individual or group that met a certain financial requirement was permitted to issue bills of credit.

This led to many a period of fiscally irresponsible of Wildcat banking in many states, which partially destabilized the system of financial intermediation, and lead in part to the massive panic in 1837-1838 in Michigan.

During this period, bills were not redeemable at face value, but could be cashed according to certain common discount rates, which reflected the reputation and solvency of the issuing banks. These bills were commonly called "scrip."