As you may know, the Office of the Controller of the Currency (OCC) of the U.S. Department of the Treasury has claimed that its so-called "visitorial powers" give it very broad preemptive power to nix state-law efforts to regulate national banks. In 2004, OCC issued pro-preemption regulations to that effect. Consumer groups have long claimed that while the federal government was doing little or nothing to regulate, for instance, the core banking function of (predatory) lending, OCC unwisely and unlawfully prevented the states from filling the vacuum.
Last year, OCC was required by the Dodd-Frank financial reform legislation to revisit its preemption stance. Many people thought that Dodd-Frank greatly restricted the preemptive effect of federal law. Not so, according to final OCC regulations issued yesterday. The National Consumer Law Center responded quickly and critically, noting that "the Office of the Comptroller of the Currency (OCC), in its final rule implementing the preemption amendments of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, continues to thumb its nose at state efforts to protect consumers. The agency gives national banks immunity from state laws protecting consumers from abusive mortgage, credit card and overdraft fee practices." Go here to see NCLC's comments on the proposed rules.
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