The other day Jillian at daily kos wrote a diary regarding the OCC and an Association of Banks suing Elliot Spitzer over the interference of the federal supervision of banks. The US District Judge Sydney H. Stein is allowing AG Spitzer to go forward with the probe.
Spitzer reminded of the OCC’s effort last year to shield nationally-chartered banks from enforcement of state consumer protection laws, “another indication,” argued Spitzer, “that the Bush administration sides with corporate interests over consumer interests.” – Barry Sergeant. More information from Sergeant is below the fold in an article for Moneyweb.
It is really beautiful to see banks and their regulators becoming so close. I just imagine Wells and the OCC, cuddling up next to the fire with some warm cocoa. It just makes me all warm and fuzzy inside.
I now truly understand what President Bush meant when he promised to unite a divided nation. While at first citizens assumed he was referring to uniting the people, it is now clear he was referring to big business and Government. One, big, happy, family.
Barry Sergeant
Posted: Wed, 22 Jun 2005 17:18 | © Moneyweb Holdings Limited, 1997-2005
New York State attorney general Eliot Spitzer won a federal case this week, when US District Judge Sydney H. Stein refused to grant a temporary restraining order halting Spitzer from investigating large US banks over their lending practices to minorities.
The heart of the issue, as explained by Spitzer was “whether minorities are being charged higher rates.” According to Spitzer, evidence already disclosed by banks “appears to show a significant racial disparity that could violate state civil rights laws, which my office is responsible for enforcing.”
Spitzer was sued by a coalition of banks, and their federal regulator. Spitzer said that while such a move was expected from the banks, “it is shameful that a federal regulator would join in an effort to shield the banks from scrutiny by state regulators.”
The federal regulator – Office of the Comptroller of Currency (part of the US Treasury) – suggested that a review of the relevant records by Spitzer’s office “would somehow interfere with federal supervision of the banks. But this position defies common sense and a century of joint state and federal oversight of the banking industry.”
Apart from the OCC, the order was sought by eight members of The Clearing House Association of 11 banks: JPMorgan Chase & Co., Wells Fargo & Co., Citigroup, Wachovia Corp., Bank of America Corp., HSBC Holdings, LaSalle Bank Corp., and US Bancorp. The other three members of the Clearing House Association are Deutsche Bank, The Bank of New York Co., and UBS Ag.
Spitzer reminded of the OCC’s effort last year to shield nationally-chartered banks from enforcement of state consumer protection laws, “another indication,” argued Spitzer, “that the Bush administration sides with corporate interests over consumer interests.”
It gets worse: “It’s unconscionable,” stated Spitzer, “that the OCC would help the banks it regulates draft litigation to shield them from reasoned enforcement of consumer protection and civil rights laws,” and then sit at the lawyer’s table right next to those banks, as happened in the court hearing.
Spitzer stressed that his office was “committed to enforcing laws that protect the citizens of the State of New York from racial discrimination in lending, and will strongly resist attempts to limit our long-standing authority to do so.”
Earlier this year, Spitzer attacked proposals, before the Federal Deposit Insurance Corporation, which would exempt state-chartered banks from complying with most state consumer protection laws, including laws related to predatory lending, fair lending and community reinvestment. This was, bellowed Spitzer, “another shameless attempt by the financial services industry to undermine state consumer protection laws.”
