Preempted at Last
The U.S. Office of the Comptroller of the Currency (USOCC) and the Clearing House Association have turned the tables on Eliot Spitzer. The USOCC sued New York’s AG for exceeding his authority by investigating federally regulated financial institutions. The Clearing House Association, which represents federally chartered lending institutions, has sought relief on similar grounds.
The USOCC offered a supporting memorandum and U.S. Comptroller Julie Williams said, “While the New York attorney general’s office has legitimate authority for a great number of lending institutions operating in the state, federal law [i.e., the National Bank Act] provides that lending activities of national banks and their subsidiaries are under the jurisdiction of the OCC.”
The Clearing House suit echoed the OCC’s position: “This action presents a purely legal issue regarding the primacy of federal law with respect to national banks.”