The subject of Eliot Spitzer's latest round of investigations isn't taking the New York Attorney General's probing lightly. Aspiring gubenatorial candidtate, Spitzer had recently aimed his sights on the lending industry charging that dicriminatory practices are running rampant.

Banking industry groups, however, insist that Spitzer's investigation interferes with existing federal regulation and they have found a governmental ally in the federal Office of the Comptroller of the Currency. The OCC is also attempting to block what it terms as Spitzer's distuption of its fair-lending oversight mandate.

N.Y. official sued over bank probe

By Larry Neumeister
The Associated Press
Jun. 17, 2005

NEW YORK - An association of leading commercial banks and a federal agency sued New York Attorney General Eliot Spitzer on Thursday, saying his probe into the lending practices of national banks violates laws ensuring that banks are not subject to supervision by state authorities.

The suit asked the U.S. District Court in Manhattan to block Spitzer from demanding information to enforce federal and state discrimination-in-lending laws against banks belonging to the Clearing House Association. The Manhattan association said it was protecting the rights of its 11 members, eight of which are federally chartered national banks already subject to federal regulation.

The bank association said at least three members -- HSBC Bank USA, JPMorgan Chase Bank and Wells Fargo Bank -- have been subjected to the inquiry.

The suit by the Office of the Comptroller of the Currency seeks to block what it said was Spitzer's interference in the agency's fair-lending supervision.

The agency "is absolutely committed to assuring that the national banking system is free of lending discrimination of any sort," acting comptroller Julie Williams said in a statement. "This issue is vital and it is complex, and it must not be politicized."

Spitzer has questioned some of the nation's biggest banks in an investigation of potentially discriminatory mortgage practices. Community groups have said blacks and Hispanics are more likely than Anglos to be given higher-cost mortgage loans and are much more likely to be turned down for mortgages.

The original article can be found here. More details from the OCC regarding their complaint against Spitzer's office can be found here.

-- MDT

Labels: Eliot Spitzer, New York AG