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As Federal Reserve Rubber Stamps Merger By Ameris Jerome Powell Omits Regulatory Duties

By Matthew R. Lee, Patreon

NEW YORK, June 14 – The bank with the worst record in the United States for gouging consumers with overdraft fees, Ameris, has nevertheless gotten a rubber stamp approval from the Federal Reserve Board, to buy Hamilton State Bancshares in Georgia. Fair Finance Watch submitted formal opposition with the Fed, citing the gouging, Ameris' disparate mortgage lending record in Atlanta, Georgia and Florida, and the Community Reinvestment Act. See below. Earlier this year Ameris admitted in a responses that one of its filed application was false when it said it would continue the CRA policies of Atlantic - see full response on Patreon, here, question 3. Still, the Fed's June 13 order blandly recites " a commenter objected to the proposal on the basis of alleged disparities in the number of home mortgage loans made by Ameris Bank to, and/or in the rate of denials for home mortgage applications from, African Americans and/or Hispanics, as compared to whites, in Atlanta, Georgia; Jacksonville, Florida; and Tallahassee, Florida, based on data reported under the Home Mortgage Disclosure Act of 1975 (“HMDA”). The commenter also alleged that Ameris Bank engaged in predatory collection of overdraft fees and expressed concern over Ameris’s recent record of mergers and acquisitions." The concerns continue to grow.  Inner City Press  requested records under the Freedom of Information Act - but the Fed these days can take months to respond. On June 13, alongside the Ameris approval, Fed chair Jerome Powell answered a pre-picked question that the Fed's job involves interest rates and maximum employment. He did not mention the Fed's bank regulatory responsibilities. Seems he thinks someone else is doing that - but that someone is no longer the Consumer Financial Protection Bureau, nor the OCC. US Comptroller of the Currency Joseph Otting, who generated fake comments supporting his OneWest Bank's merger with CIT Group, testified on Capitol Hill on June 13. When asked about discrimination in America, Otting said "I have never personally observed it." Otting is now seeking to remove the "community" from the US Community Reinvestment Act, eliminating focus on the areas from which banks draw their insured deposits. On June 13 he said, "As a banker for more than 30 years, I saw firsthand the benefit of CRA activities and how they make communities more vibrant. I believe in the power of community reinvestment to reinvigorate financially distressed areas and to give residents of those neighborhoods new hope and new economic opportunities. I have been involved in directing hundreds of millions of dollars in community development, reinvestment, and support for groups that provide important services to their communities, and I want to expand the types of activities eligible for CRA consideration." He wants to include, for example, contribution to things that have nothing to do with low or moderate income people. NCRC, of which FFW is a member, is opposing this. The US Consumer Financial Protection Bureau under Mick Mulvany has moved to disband the statutory Consumer Advisory Board, Mulvaney told the 23 board members at 11 am on June 6. Mulvaney had cancelled an in-person meeting with the Board, mandated by the Dodd Frank act, proposing instead another telephone conference call - on which he fired the board members. On June 4 Inner City Press covered a media call by Consumer Advisory Board members, after asking Citigroup some questions at the UN - just as it covered the shift before the 2016 election of some regulatory functions of the Federal Reserve, which continued to rubber stamp bank mergers, to the CFPB. Now the CFPB is stepping further back from regulation, to put it mildly. And the Fed and the other two federal bank regulators are not picking up any of the slack - for example on Ameris. From Fair Finance Watch's (and Inner City Press') filings with the Fed: "Fair Finance Watch has reviewed Ameris' lending in 2016, the most recent year for which Home Mortgage Disclosure Act (HMDA) data is available, in both the Atlanta and the Jacksonville Metropolitan Statistical Areas (MSAs) and finds both to be disparate. In the Atlanta MSA in 2016 for refinance loans, Ameris denied the applications of African Americans 3.75 times more frequently than those of whites. Ameris made 152 such loans to whites, only 16 to African Americans and only eight to Latinos. In the Atlanta MSA in 2016 for home purchase loans, Ameris denied the applications of African Americans 2.11 times more frequently than those of whites. Ameris made 582 such loans to whites, only 206 to African Americans and only 48to Latinos. In the Jacksonville MSA in 2016 for home purchase loans, Ameris denied the applications of African Americans 2.69 times more frequently than those of whites. Ameris made 203 such loans to whites and only SEVEN to African Americans. In the Jacksonville MSA in 2016 for home improvements loans, Ameris made five such loans to whites and none to African Americans or Latinos. In the Jacksonville MSA in 2016 for refinance loans, Ameris denied the applications of African Americans 2.2 times more frequently than those of whites. Ameris made 100 such loans to whites and only FOUR to African Americans. This is disparate. Fair Finance Watch also reviewed Ameris' home purchase lending in the Tallahassee MSA in 2016: Ameris denied the applications of African Americans 3.78 times more frequently than those of whites. Ameris made 147 such loans to whites and only FIVE to African Americans. Ameris is systemically disparate. Also for the record, and to be addressed at the requested evidentiary hearings: “Georgia bank socking customers with overdraft fees,” Atlanta Journal Constitution, January 3, 2017: “Ameris Bank collected the most overdraft/insufficient fund fees per account of any U.S. bank, says the analysis, which is based on federal government data from the first three quarters of 2016. Ameris collected an average of about $176 per account.. The No. 2 bank on the list of the top 10 collected an average of about $131 per account. The national average was $17.76.”  This is predatory. On the current record, Ameris' applications should be denied." 

Amid the ongoing scandal of the Office of the Comptroller of the Currency covering up Sterling Bank's unreliable Community Reinvestment Act data by withholding most of 400 pages released to Inner City Press under the Freedom of Information the OCC is now trying to strong-arm Inner City Press into scaling back its request to exclude "internal OCC communications." On November 30 the OCC wrote to Inner City Press, "Since the Federal Reserve Board has already submitted its final response to you regarding your FOIA request to them, would you consider modifying your OCC request to receiving: 1) All communications between the OCC and the Bank minus the Federal Reserve Board application transmittal documents; 2) Bank CRA Data; 3) Public Comments received by OCC on the merger application. Please respond to this email if you concur as soon as practicable." Inner City Press replied, "The problem Inner City Press has with this proposed limitation of FOIA request is we don't know what we are waiving - what beyond this that is responsive to our request are you asking us to waive our request to?" Now on December 5, this response: "OCC internal communications." But this is a purpose of FOIA, to see how government actually works, and for who. On December 27, the OCC provided Inner City Press a "final" response with virtually all information about the CRA data redacted. Inner City Press has submitted a FOIA appeal "of the OCC's December 27, 2017 (and any other) Denials of ICP's FOIA Request regarding the application Sterling to acquire Astoria and in particular Sterling's unreliable CRA data and the [OCC's] awareness of this unreliability." This is UNacceptable. The FDIC is primed to take as its leader the lawyer of Fifth Third Bank, Jelena McWilliams. When Fair Finance Watch asked Fifth Third for its Home Mortgage Disclosure Act data, Fifth Third insisted on only giving the data in paper form, unlike nearly all other banks which gave it electronically. The effect was to make it impossible to analyze patterns in the data, the purpose of the HMDA law. Meanwhile the Consumer Financial Protection Bureau has become a battlefield. In order to run in Ohio, Richard Cordray stepped down at the head of the CFPB, naming as his successor Leandra English. Hours later, Trump issued a statement that "he is designating Director of the Office of Management and Budget (OMB) Mick Mulvaney as Acting Director of the Consumer Financial Protection Bureau (CFPB)." On November 25 the White House held a background press call, on which opposition to the naming of Mulvaney was characterized coming from "blog-posts." Still, the Senior Administration Officials were asked if they plan to have Leandra English removed from the premises. No, was the answer: she should show up at the Deputy. But have they spoken with Ms English? No, was the answer.  On Sunday English filed suit against Mulvany "in his capacity as the person claiming to be the acting director of the CFPB." But a preliminary injunction has been denied. Watch this site. After non-response by the OCC even has it promises merger approvals to banks with Needs to Improve CRA ratings and allows Bank of Tokyo - Mitsubishi to skirt North Korea sanctions review by fast approving applications for which effective public notice was never provided (ICP scoop on notice here),Already, the low percentage of banks being given less than satisfactory Community Reinvestment Act rating has become infinitesimal. Now the Office of the Comptroller of the Currency has signaled that even those few low scores will have no impact. In a "Policy and Procedures Manual" quietly issued on November 8, with no notice or comment, the OCC says "An overall less than satisfactory CRA rating is not a bar to approval of an application. Rather, the facts and
circumstances of the application must be evaluated as discussed in this PPM." (PPM 6300-2). All of this under an "Acting" Comptroller who has overstayed his term. We'll have more on this- and this: Sseven months after Wells Fargo Bank's CRA rating was dropped two levels to "Needs to Improve," barring it from acquisitions, the Office of the Comptroller of the Currency has quietly said, in a footnote to a Bulletin issued on October 12, that "The OCC’s policy is not to lower a bank’s CRA composite or component rating by more than one rating level." See here, footnote 8. So when did this become the OCC's policy, after it dropped Wells by two levels? Call it a stealth sop to Wells Fargo - and seemingly a violation of the Administrative Procedures Act. We'll have more on this. In July it emerged that over 800,000 people who took car loans from Wells were charged for needless auto insurance, pushing 274,000 Wells Fargo customers into delinquency and triggering nearly 25,000 wrongful vehicle repossessions. So much for the industry having cleaned itself up after the predatory lending meltdown. New York City announced it will not enter any new relationships with the bank, also suspending Wells Fargo's role as a senior book-running manager for NYC General Obligation and Transactional Finance Authority bond sales. A statement by Mayor Bill de Blasio and Controller Scott Stringer noted that "Currently, Wells Fargo holds contracts with the City to provide banking services, including to operate 'Lock Box' services that hold taxes and fees collected by the City. There is approximately $227 million of City dollars held in Wells Fargo accounts." But will they get involved in opposing Sterling National Bank, which Inner City Press and Fair Finance Watch have exposed as having "unreliable" CRA data, notwithstanding the OCC's scam "Satisfactory" rating on May 30? Click here.


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