Spitzer Gains Allies in Fight Against Bank Regulators | AccountingWEB

Spitzer Gains Allies in Fight Against Bank Regulators

New York Attorney General Eliot Spitzer has gained some heavy-weight support in his legal fight against a federal banking regulator's attempt to stop his probe of mortgage-lending practices.

Attorneys general in 34 states and the National Association of Realtors have joined Spitzer in seeking dismissal of a case filed by the U.S. Office of the Comptroller of the Currency, which contends Spitzer's office exceeded its authority by seeking records from nationally chartered banks.

Spitzer wants mortgage-lending records from Citigroup's Citibank, JPMorgan Chase & Co., HSBC Bank USA and Wells Fargo, among others, to find out whether big banks change minority borrowers more to get mortgages, Reuters reported.

The comptroller's office, part of the U.S. Department of the Treasury, claimed that Spitzer interfered with the regulator's bank examinations, and a federal judge last month stopped Spitzer's probe.

Spitzer is urging the court to throw out the suit, saying it is an attempt to strip states of their investigative authority. In a counterclaim filed Friday Spitzer argued, “The OCC's rulemaking authority extends solely to promulgating rules designed to ensure the safety and soundness of national banks. The rulemaking at issue here offers no explanation as to how preventing state enforcement of fair lending laws against national banks - and thereby limiting overall enforcement in this area - would further these safety and soundness goals."

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