Comment On The Supreme Court’s Decision In Cuomo v. Clearinghouse

“The Supreme Court’s decision in i invalidated a regulation of the Office of the Comptroller of the Currency (OCC), the agency that oversees national banks.  As part of an investigation into discriminatory lending practices by some national banks in New York, the New York Attorney General sent letters to several national banks seeking information concerning the banks’ lending practices, in an effort to determine whether these practices violated state fair-lending laws.  The national banks and the OCC resisted, and argued that an OCC regulation shielded national banks from the enforcement of state laws of general application, asserting that the enforcement of such state laws against the national banks amounted to an exercise of impermissible ‘visitorial’ power by the state.  Under the National Bank Act, the exercise of visitorial power over national banks is reserved for the federal government.

“The Supreme Court has once again been required to act as a check against the former Bush Administration’s attempt to prohibit state law from protecting consumers.  In holding that the OCC regulation at issue in Cuomo was invalid, the Court has reaffirmed the authority of the sovereign states to police corporate actors within a state, and protect their citizens.  And the Court has rightly rejected the national banks’ attempt to hide behind an unreasonable agency regulation in order to escape scrutiny from state authorities.”

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