In Cuomo Versus Allegedly Racist Banks, Obama Picks Banks
April 10th, 2009

Data suggest that national banks charged higher mortgage interest rates to people of color in New York, and Attorney General Andrew Cuomo wants the authority to investigate whether they broke state anti-discrimination lending laws in doing so. But the Bush Administration joined a lawsuit to thwart the attorney general’s office — at the urging of the Clearing House Association, a coalition of national banks — and the case is now in federal court.

With the Obama Administration now in charge, advocates had hoped that they would side with New York. But last week the new solicitor general, Elena Kagan, sided with the Bush Administration, arguing the federal Office of the Comptroller of the Currency has jurisdiction in the matter. The agency is the federal plaintiff in the case. “National banks are created by the government to serve federal purposes,” Kagan argued in an amicus brief, “and that oversight of the banks is therefore principally entrusted to the United States.”

Bloomberg News reports that consumer advocates think a Bush holdover may be limiting the current administration’s options. John Dugan, the head of the comptroller’s office, will remain in charge until 2010 when his term expires.

If the [comptroller’s office] was unwilling to change their position, then the Justice Department had relatively few options, Eric Halperin, a lawyer with the Center for Responsible Lending, told Bloomberg. We would hope that in the future the [agency] shows as much concern about consumer protection as they do about protecting their turf.

But some say that the comptroller’s office hasn’t done it’s job, under the Bush Administration at least. Stephanie Mencimer, writing for Mother Jones, reports that only three staff members at the agency are actually assigned to investigating and resolving consumer complaints. According to Mencimer, they field over 70,000 such complaints annually.

The U.S. Supreme Court of Appeals for the Second District is scheduled to hear arguments on April 28.

By on April 10, 2009, 3:57 pm
In category: Civil Rights,Housing,Law | 1 Comment »

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One Response to “In Cuomo Versus Allegedly Racist Banks, Obama Picks Banks”

  1. Careful Reader Says:
    April 14th, 2009 at 11:16 am

    the comptrollers office hasnt done its job

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