OCC Sues NY AG Over Bias Probe

The Office of the Comptroller of the Currency has filed suit against New York Attorney General Eliot Spitzer, seeking a declaratory judgment and preliminary injunction to prevent him from interfering in the OCC's fair-lending supervision of national banks.The action follows the filing of a suit by The Clearing House Association that seeks similar remedies against the New York AG. The OCC is asking the U.S. District Court for the Southern District of New York to permanently bar Mr. Spitzer from demanding or examining the records of any national bank or its operating subsidiary. Mr. Spitzer's office recently began a probe of at least four national banks to determine whether discriminatory lending practices have been used in setting interest rates and fees on mortgage loans. According to an attorney familiar with the case, Mr. Spitzer's actions are "just another attempt to challenge what is clear law. States have no visitorial power of national banks. The OCC is asking the court to confirm its position that he has no jurisdiction." Julie L. Williams, acting comptroller of the currency, said the AG's office has shown it is not interested in a collaborative approach. "Unfortunately, the attorney general's actions undermine the OCC's ability to effectively implement our supervisory responsibilities," she said.