WASHINGTON, Aug. 5 /PRNewswire/ -- The Center for Responsible Lending
joined today with 15 other groups in filing a brief supporting New York
Attorney General Eliot Spitzer's efforts to enforce discrimination laws
against national banks.
Spitzer asked the banks to explain why the numbers the federal government
requires them to make public each year show racial disparities in the banks'
mortgage lending.
Some banks contend a state official like Spitzer doesn't have the
authority to enforce state discrimination laws against them. Their federal
regulator, the Office of the Comptroller of the Currency, agrees and sued
Spitzer.
The Comptroller sued the same day the Clearing House Association, a group
of banks including JPMorgan Chase, HSBC, and Wells Fargo, asked a federal
court to bar Spitzer from making them reveal the information.
The Center for Responsible Lending, a nonprofit, nonpartisan research and
advocacy group, opposes the federal agency's aggressive effort to overturn
decades of state and local governments enforcing their own fair-lending laws
and says federal law supports the center's position.
The numbers that concern Spitzer are disclosed annually by the banks under
the federal Home Mortgage Disclosure Act, which this year for the first time
required banks to tell how many high-priced loans they made last year. These
loans are defined as carrying interest rates and fees three or more percentage
points above comparable Treasury securities (or five or more percentage points
for junior liens like second mortgages).
African-Americans are three times more likely to get these higher-cost
loans, according to an analysis by the National Community Reinvestment
Coalition, which represents hundreds of community groups. Predatory lenders do
most of their business in this market, which has exploded in the last decade.
Predatory loans threaten working-class people with financial reverses and even
the loss of their homes and expose fragile neighborhoods to the blight of
foreclosures and boarded-up houses.
The banks contend that only the federal government has the power to
enforce even state laws against national banks. The Center for Responsible
Lending disagrees, saying the Comptroller of the Currency should stop helping
them oppose Spitzer's legitimate attempt to enforce state law.
"There is no reason why banks should have an exemption from state
enforcement of civil rights laws," said Eric Halperin, senior policy counsel
at the Center for Responsible Lending. "If national banks are not
discriminating, they should have no problem providing information to the
attorney general."
"We hope a commitment to freeing the credit marketplace of discrimination
is something every public official shares," said Halperin. "Unfortunately, the
Office of the Comptroller of the Currency has chosen to fight for turf instead
of fairness. We are disappointed by its choice of priorities."
Said John Taylor, president and CEO of the National Community Reinvestment
Coalition: "Whenever a systematic disparity in mortgage lending occurs, it's a
civil rights issue, plain and simple. Civil rights is not an issue of
preemption, it's a national priority. NCRC's membership is committed to
eliminating the dual lending marketplace both in New York and across the
nation. We stand hand in hand with Eliot Spitzer to ensure equal access to
credit."
Among the groups joining the legal brief are the National Community
Reinvestment Coalition, the National Fair Housing Alliance, the National
Association of Consumer Advocates, AARP and the NAACP Legal Defense and
Educational Fund Inc. and these New York state groups: The Fair Housing
Justice Center of HELP USA, the Neighborhood Economic Development Advocacy
Project and the Foreclosure Prevention Project of South Brooklyn Legal
Services.
To read the brief, go to the center's website at
http://www.responsiblelending.org.
About the Center for Responsible Lending
The Center for Responsible Lending is a nonprofit, nonpartisan research
and policy organization dedicated to protecting homeownership and family
wealth by working to eliminate abusive financial practices. CRL is affiliated
with Self-Help, one of the nation's largest community development financial
institutions.
SOURCE Center for Responsible Lending
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Related links:
http://responsiblelending.org
CONTACT:
Michael Flagg of the Center for Responsible
Lending, +1-202-349-1862, or mike.flagg@responsiblelending.org
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