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While Community Reinvestment Act on COVID 19 Must Be Extended FDIC More Deregulation

By Matthew Russell Lee, Patreon Periscope
BBC - Guardian UK - Honduras - CJR - PFT

BRONX / SDNY, March 19 – With the Community Reinvestment Act under attack by US Comptroller of the Currency Josephy Otting joined by the FDIC, Fair Finance Watch and Inner City Press on March 18 submitted a fourth comment formally reiterating an obvious request. They demand that in light of the Coronavirus / COVID-19 crisis, leading to the shutdown of some courts, shelter in place orders and regulatory extensions even by the SEC, the OCC and FDIC comment period on the assault on CRA be extended for months. See also here.

  Now the FDIC, oblivious, instead of focusing on the Coronavirus crisis proposed more deregulation, of Industrial Loan Companies, while doling out approvals to two fintechs. This is a scandal, even to bankers: "Independent Community Bankers of America® (ICBA) President and CEO Rebeca Romero Rainey issued this statement on the Federal Deposit Insurance Corp.'s proposed rule on industrial loan companies.     “ICBA is extremely concerned about the FDIC proposed rulemaking on the parent companies of industrial loan companies and its approval of ILC deposit insurance applications from Square Financial Services Inc. and Nelnet Bank. The ILC loophole in the Bank Holding Company Act allows commercial interests to own full-service banks, avoid consolidated supervision, and threaten the financial system. Conditions imposed by the FDIC, whether in the approvals or the proposed rule, are insufficient to alleviate these concerns.  "To mitigate risks to the financial system, ICBA continues to call on the FDIC to refrain from approving any additional deposit insurance applications submitted by ILCs until the proposed rulemaking is finalized."

 Given the FDIC's and OCC's irresponsibility, now Fair Finance Watch goes further: nothing except emergency bank merger applications should be approved. How can processing applications subject to public hearings requests be processed, when public hearings are prohibited? No more deregulation. Rogue regulators should be removed. We'll have more on that.

On FFW's forth comment, confirmation of receipt by of the comment and request has been received, as
1k4-9fmb-3dsl  Here it is:

March 18, 2020 Via

Office of the Comptroller of the Currency Chief Counsel's Office, Attention: Comment Processing,  400 7th Street SW, Suite 3E-218, Washington, DC 20219

Re: Docket ID OCC-2018-0008 - 4th opposition to OCC/FDIC plan to weaken CRA - formal demand that comment period be extended in light of Coronavirus COVID-19 & OCC inaction

To whom it may concern at the OCC and FDIC:    On behalf of Fair Finance Watch, and Inner City Press, and in my personal capacity, this is a fourth timely comment opposing the proposal by Comptroller Joseph Otting and the FDIC to weaken the CRA.   On March 11, amid the then-worsening Coronavirus COVID-19 crisis, we wrote to formally demand an extension of this comment period:  

 No response so far from the OCC. This as, simply for example, the SEC has publicly confirmed a first extension on  its items, past April 8. Now the ranking member of the Senate Banking Committee has written to Comptroller Otting. While the two other federal bank regulatory agencies responded to press inquiries about the letter, the OCC did not. In the midst of the crisis, it is replacing its OCC with a crypto-currency executive.

   Meanwhile on a pending CRA merger challenge submitted electronically by FFW to Northfield Bank - Victory State Bank choosing to respond, cursorily, by snail mail. Something is dreadfully wrong at the OCC. This comment period on weakening the CRA must be indefinitely extended. 

 The above is added to what we can only interpret as the OCC's furthering weakening of CRA by no documents response to our FOIA request about this CRA proposal and the Comptroller's schedule, and the OCC's failure to inquire into even branch closings int he CBNA - Steuban Trust proposal we comments on. This is not the time to be slipping through an undermining of CRA.  

 Note, simply as examples, that not only have many Federal courts have shut down (see, e.g., the Eastern District of Washington), whole law firms have, and beyond the containment zones of New Rochelle, NY just above The Bronx there is now talk of a shelter in place order in New York, not only San Francisco and elsewhere. The comment period must be extended.  Enforcing the CRA including through commenting to the Federal Reserve and FDIC, and OCC under previous Comptrollers, the results have been new bank branches in the South Bronx, and lending and consumer protection commitments well beyond. 

 Now under Otting the OCC is ignoring, rebuffing and sometimes simply rejecting such public comments. This as Otting says he is personally unaware of discrimination. So, during and in connection with this comment period on his attempt to more systematically defang the CRA, Fair Finance Watch has commented on a proposed acquisition by a national bank which settled race discrimination charges, Evans Bank (see previous comments). 

  This is a national bank. And for the record, the CFPB's elimination of the HMDA informaiton that has been available on the FFIEC's and even its own website for 2017 data is part of the destruction of CRA and HMDA of which the OCC is a part.   Also for the record, "Nasca says there may be consolidation of some back office staff." Public hearings should be held. But Otting routinely denies such requests. 

  Again, since Otting became Comptroller, we have seen timely comments ignored, and been denied access to bank merger applications by a retaliatory imposition of FOIA fees. The Federal Reserve and other federal agencies, like the OCC pre-Otting, grant Inner City Press FOIA fee waivers. Under Otting, the OCC does not. On Chinatown FSB, the OCC refused to consider a timely comment. The OCC unilaterally determined not to accept public comments on a major bank's charter conversion application, which it rubber stamped. This has been rogue-like behavior.  

 As a proud member of NCRC we join in its comments, previously cited... The agencies must also make commenting on CRA exams and merger applications easier, including providing easy access to agency staff that can guide the public in making comments. The central point of CRA is ensuring that banks meet local needs. For agencies to ascertain that, they must listen carefully to the public.

  But Otting has shown that he does not, or does so only selectively. The proposal must be rejected. We will have further comments. Matthew R Lee, Fair Finance Watch (and Inner City Press) New York.  Watch this site.


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