Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, and Congressman Gregory Meeks (D-NY), Chair of the Subcommittee on Consumer Protection and Financial Institutions, introduced a Congressional Review Act resolution to reverse the harmful Community Reinvestment Act (CRA) rule recently finalized by the Office of the Comptroller of the Currency.
Chairwoman Waters made the following statement:
“When then-Comptroller Otting recently rushed out a harmful rule gutting the Community Reinvestment Act (CRA), I made it clear that Congress would not let the rule stand. Today, I and Congressman Meeks have introduced a Congressional Review Act resolution to nullify the OCC’s rule.
“Otting recklessly pushed ahead with his rule, which will result in disinvestment in many low- and moderate-income communities, despite the Federal Reserve and the FDIC - the other regulatory agencies responsible for enforcing CRA - declining to join in the rulemaking.
“The Community Reinvestment Act is an essential law that was put in place to prevent redlining and to require banks to invest and lend responsibly in the communities where they are chartered. It is completely unacceptable for the OCC to use the cover of a pandemic to rush out a rule that will be harmful to communities that are already suffering during this crisis. This resolution we introduced today will right that wrong.”
Chair Meeks made the following statement:
“Chairwoman Waters and I have been steadfast that any reforms to the Community Reinvestment Act must remain true to the law’s civil rights roots. My office conducted and published an extensive study of bank branch distribution in Queens, finding that predominantly black and Hispanic zip codes have seven times fewer bank branches than non-minority zip codes, even when adjusting for income. The Financial Services Committee has held a series of hearings on modern-day redlining, and the critical need for a stronger CRA, supported by methodical data analysis, and reflecting the recommendations of community organizations. Comptroller Otting and the OCC have failed systematically to achieve this, and put forward a rushed, incomplete rule that will harm the very communities the CRA is meant to support.”
See here for the text of the resolution.
See here for Chairwoman Waters’ statement on the OCC’s issuance of the rule.
On April 7, Chairwoman Waters led a letter signed by all other Committee Democratic Members to Comptroller Otting and Jelena McWilliams, Chairman of the Federal Deposit Insurance Corporation (FDIC), urging them to prioritize a strong response to the COVID-19 pandemic and suspend efforts to revise the Community Reinvestment Act and any unrelated rulemakings.
On March 6, the Subcommittee on Consumer Protection and Financial Institutions, chaired by Rep. Gregory Meeks (D-NY), convened a field hearing with stakeholders in Queens, New York, entitled, “Modern-Day Redlining: the Burden on Underbanked and Excluded Communities in New York.”
On February 24, in response to efforts by Chairwoman Waters and Committee Democrats to ensure the public had enough time to provide comment on the OCC and FDIC’s Notice of Proposed Rulemaking to overhaul CRA regulations, the agencies announced a 30 day extension of the comment period.
On February 6, the Oversight and Investigations Subcommittee, chaired by Rep. Al Green (D-TX), convened a hearing with stakeholders entitled, “Fake It Till They Make It: How Bad Actors Use Astroturfing to Manipulate Regulators, Disenfranchise Consumers and Subvert the Rulemaking Process.” As part of the hearing, witnesses discussed allegations that Comptroller Otting, when he was the CEO of OneWest Bank, may have been involved in fabricating comments in support of OneWest’s merger with CIT.
On January 29, Chairwoman Waters convened a hearing entitled, “The Community Reinvestment Act: Is the OCC Undermining the Law’s Purpose and Intent?” with Comptroller Otting testifying as the sole witness.
On January 15, Chairwoman Waters opened an investigation into potential astroturfing efforts to influence the OCC and FDIC’s CRA rulemaking, demanding the agencies explain efforts to ensure legitimacy of the rulemaking process.
On January 14, the Subcommittee on Consumer Protection and Financial Institutions, chaired by Rep. Gregory Meeks (D-NY), convened a hearing with stakeholders testifying entitled, “The Community Reinvestment Act: Reviewing Who Wins and Who Loses with Comptroller Otting’s Proposal.”
In December 2019, Chairwoman Waters led a delegation of the Committee in attending a public meeting of the FDIC’s Board of Directors where CRA was on the agenda.
The Members’ trip to the FDIC followed a letter sent to banking regulators led by Chairwoman Waters and Consumer Protection and Financial Institutions Subcommittee Chairman Gregory Meeks (D-NY) and signed by all 34 Committee Democrats, along with all 12 Senate Banking Committee Democrats led by Ranking Member Sherrod Brown (D-OH). The letter, addressed to FDIC Chairman McWilliams, Federal Reserve Chairman Jerome Powell, and OCC Comptroller Joseph Otting, calls on the regulators to, at a minimum, include a public comment period of at least 120 days for any proposal reforming CRA to ensure it gets a full vetting and that all interested parties have an opportunity to analyze and comment on the proposal.