Inner City Press' Community Reinvestment Reporter

  

     Welcome to Inner City Press’ CRA Report.  Our other Reporters cover the financial services industry, human rights, the Federal Reserve, and other beats.  ICP has published a book about the CRA-relevant topic of predatory lending - click here for sample chapters, a map, and ordering informationCBS MarketWatch of April 23, 2004, says the the novel has "some very funny moments," and that the non-fiction mixes "global statistics and first-person accounts."  The Washington Post of March 15, 2004, calls Predatory Bender: America in the Aughts "the first novel about predatory lending;" the London Times of April 15, 2004, "A Novel Approach," said it "has a cast of colorful characters."  See also, "City Lit: Roman a Klepto [Review of 'Predatory Bender']," City Limits, Oct. 2004.  The Pittsburgh City Paper says the 100-page afterword makes the "indispensable point that predatory lending is now being aggressively exported to the rest of the globe." Click here for that review; click here to Search This Site  Click here for Inner City Press' weekday news reports, from the United Nations and elsewhere.

Click here for Inner City Press' weekday news reports, from the United Nations and elsewhere. Click here for a recent BBC piece on Inner City Press' reporting from the United Nations. New: Follow us on TWITTER   BloggingHeads.tv  Click for March 1, 2011 BloggingHeads.tv re Libya, Sri Lanka, UN Corruption by Inner City Press. 2014: MRL on Beacon Reader  For or with more information, contact us.

June 21, 2021

JPMorgan Chase Is Sued For Retaliation Now Complaints of Sealed Material Blurted In Court

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - ESPN

SDNY COURTHOUSE, June 16 – JPMorgan retaliated against Donald Turnbull, he says, because it suspected him of telling DOJ about "a range of the Bank's institutional failures regarding manipulative trading practices."     

       On June 16, U.S. District Court for the Southern District of New York Judge John G. Koeltl held a proceeding. Inner City Press covered it.   

 The proceeding was public - but a complaint was made that material for now filed under seal into the docket was read out in open court. Why so secret?

The case is Turnbull v. JPMorgan Chase & Co., 21-cv-3217 (Koeltl)

 And then there are the requests / demands that Chase return the overdrafts it took during the COVID crisis...

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June 14, 2021

Old National - 1st Midwest Will Be Scrutinized After PNC Abstention, As M&T Stonewalls

By Matthew Russell Lee, Patreon Story
BBC - Guardian UK - Honduras - ESPN

FEDERAL COURT / S Bronx, June 7 – Whether or not the U.S. Community Reinvestment Act will be again enforced until the new Administration and its regulators is an open question. And the proposed merger of two redlining banks, M&T and People's United, will be a litmus test, see below.

And now another one: Old National's proposal to buy First Midwest. If the Federal Reserve, or at least Governor (soon to be Fed chair?) Lael Brainard, had a problem with PNC - BBVA, why now Old National - First Midwest?

  For now we note that in Indiana in 2019 Old National based on its disparate marketing made 3312 mortgage loans to whites, with 1060 denials to whites -- while making only SIXTY TWO loans to African Americans, with more than that in denials: 65. This is outrageous.

 Inner City Press (and Fair Finance Watch, on the HMDA) will have more to say about this. Watch this site.

  While M&T - People's United still pends in the Federal Reserve, with a promised expedited FOIA response still not forthcoming, the Fed in mid May approved PNC - BBVA, with a rare abstention by Governor Lael Brainard, albeit on antitrust and not CRA or fair lending grounds.

June 7, 2021

Webster Proposed Sterling Merger Is Challenged to Fed Based on Disparities, Weak PPP Lending

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - CJR - PFT

SOUTH BRONX / SDNY, June 3– The proposed merger of Webster Financial Corp. and Sterling Bancorp has now been challenged, on disparate lending and regulatory evasions.

  Fair Finance Watch has found that in 2019 in its home state of Connecticut, Webster National Bank made 3147 mortgage loans to whites, with 1364 denial to whites - while making only 71 loans to African Americans with fully 99 denials to African American. This is significantly worse than other banks in the state; the merger must be denied.

  Now Fair Finance Watch has found even worse disparities for Webster in New York, and on June 3 filed a formal protest with the Federal Reserve in DC and Boston:

Webster's record in New York State is even more disparate. In 2019 in NYS, Webster Bank based on its disparate marketing made 356 mortgage loans to whites, with 178 denial to whites - while making only EIGHT loans to African Americans with fully 10 denials to African American. 

Webster has also under performed in PPP lending:  "the head of Waterbury-based Webster Bank admitted his company can improve its performance in getting money into the hands of loan applicants.  “Certainly we wanted to help every small business borrower and customer of Webster that we could,” said CEO John Ciulla, speaking Tuesday on a conference call. “We got through approximately 30 percent applications approved (and) 30 percent funded, plus or minus a few percentage points on both sides of that."     This and Webster's dubious "health savings accounts" which it wants excluded from CRA, must be reviewed in this proceeding, including in public hearings    As to Sterling, Inner City Press previously exposed it as having unreliable CRA data, see, here.     There is no public benefit to this proposal.

   Among the comments on the Community Reinvestment Act submitted to the Federal Reserve recently  is one from Webster Bank, arguing that Health Savings Account "deposits should not be considered when determining whether the requirement would apply or when delineating such assessment areas" and should be excluded from the definition of "retail domestic deposits."Consequently, HSAs should also be excluded from  Community Development Financing Metric.

This is scam.

May 31, 2021

Citizens - HSBC Will Be Scrutinized After PNC BBVA Abstention, As M&T People's Stonewall

By Matthew Russell Lee, Patreon Story
BBC - Guardian UK - Honduras - ESPN

FEDERAL COURT / S Bronx, May 26 – Whether or not the U.S. Community Reinvestment Act will be again enforced until the new Administration and its regulators is an open question. And the proposed merger of two redlining banks, M&T and People's United, will be a litmus test, see below.

And now another one: Citizens Bank's proposal to buy 80 more branches, from HSBC. If the Federal Reserve, or at least Governor Lael Brainard, had a problem with PNC - BBVA, why now Citizens - HSBC? Inner City Press (and Fair Finance Watch, on the HMDA) will have more to say about this. Watch this site.

  While M&T - People's United still pends in the Federal Reserve, with a promised expedited FOIA response still not forthcoming, the Fed in mid May approved PNC - BBVA, with a rare abstention by Governor Lael Brainard, albeit on antitrust and not CRA or fair lending grounds. But now on May 25, Governor Brainard didn't even abstain on Huntington - TCF, despite HHI Index going over 3000 in multiple markets. Limiting antitrust concern to those with $250 billion is unwise, and arbitrary. The minimal branch divestitures are just window dressing. We'll have more on this.

  On March 27, Fair Finance Watch and Inner City Press on the FOIA filed a challenge with the Federal Reserve to the banks' application, below. We await full response to the FOIA.

 On April 12, the Federal Reserve asked M&T 32 questions, including:

"Provide People’s United’s record and experience with customer complaints and the types  of actions taken by the company to resolve these complaints. Explain the complaint  handling process, including identification, evaluation, monitoring, and resolution.  Identify the number of complaints received during each of the last two years and how the  complaints were resolved. Discuss the policies and procedures People’s United has in  place to protect customers and resolve complaints. Please also provide plans for an  integrated complaints process and any early measures to monitor consumer complaints  following consummation of the proposed transaction.

 9. Indicate any legal proceedings/investigations related to consumer protection concerns  that either M&T or People’s United may be involved in.  Full letter here.

May 24, 2021

OCC Is Petitioned To Review Anchorage Paxos Protego & Nicolet - MBank Merger, Test for Hsu

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - The Source

SOUTH BRONX, May 20 – In the declared wind-down of the Coronavirus pandemic, at least in the U.S., and after a fintech and crypto-currency proponent replaced as Acting Comptroller of the Currency by Michael Hsu from the Federal Reserve, Nicolet National Bank with only six loans to African American versus 2,800 to whites has applied to the OCC to buy MBank.

  Fair Finance, with Inner City Press on the FOIA, has opposed it, see below. While awaiting to see what the Hsu OCC will do, he has received a letter from Senator Sherrod Brown:

"I am concerned about a number of national trust charters granted by the prior leadership of the OCC. Shortly after former Acting Comptroller Brian Brooks left the OCC to join Binance, a cryptocurrency exchange, several nontraditional firms that specialize in digital and cryptocurrency activities - including Paxos, Protego, and Anchorage – received conditional national trust charters from the OCC.1 As you may be aware, I have long been concerned about the OCC’s expansive view of its authority to grant charters to financial and non-financial companies.... A firm that cannot meet the rigorous requirements applicable to other banks should not be allowed to present itself to the public as a bank. Paxos, Protego and Anchorage seek to broaden access to cryptocurrencies and other risky and unproven digital assets and emerging technologies to traditional bank customers.  "

Review: Podcast by WSJ & Gimlet Claiming Brooks' OCC Helped People of Color Rings False

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - The Source

SOUTH BRONX, May 21 – For possible the most misleading, albeit well-produced, episode of a news podcast, Inner City Press has a nominee: the Wall Street Journal's (and Gimlet's) May 17, 2021 episode claiming that in 2020 the Office of the Comptroller of the Currency under Brian Brooks decided to urge banks to be fairer to people of color, here.

"5/17/2021 4:00:00 PM No Credit Score, No Problem? Banks could begin issuing credit cards to people without credit scores thanks to an effort by a banking regulator to make lending more racially equitable. WSJ's AnnaMaria Andriotis tells the story of how Black Lives Matter protests sparked the effort and explains how the lending would work."

Not.

  The episode does not even mention the Community Reinvestment Act, much less that this Brian Brooks like Joseph Otting before him assaulted the law, and also issues a since reversed "True Lender" (or Fake Lender) rule expanding high cost predatory lending, disproportionately to people of color.

  The episode is sponsored by Capital One, a rogue particularly in high cost auto lending. Was Gimlet only on the production quality, and not fact checking? The WSJ does some good reporting, but this was not among it. More podcast reviews will follow.

May 17, 2021

Wisconsin Disparities of Nicolet National Bank Raised Against MBank Merger to Hsu of OCC

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - The Source

SOUTH BRONX, May 15 – In the declared wind-down of the Coronavirus pandemic, at least in the U.S., and after a fintech and crypto-currency proponent replaced as Acting Comptroller of the Currency by Michael Hsu from the Federal Reserve, Nicolet National Bank with only six loans to African American versus 2,800 to whites has applied to the OCC to buy MBank.

  Fair Finance, with Inner City Press on the FOIA, has opposed it:

"Office of the Comptroller of the Currency  Acting Comptroller Hsu and  Central District Office Director for District Licensing 425 South Financial Place, Suite 2700 Chicago, IL 60605  

Re: Timely First Comment on Application by Nicolet National Bank to acquire mBank - application must be denied, and referral made, based on striking disparities 

Dear Acting Comptroller Hsu & others at OCC: 

This is a timely first comment opposing and requesting an extension of the OCC's public comment period on the Applications by Nicholet National Bank to acquire mBank.   

   Shockingly, the applicant Nicolet National Bank in the state of Wisconsin in 2019 made 2,800 HMDA-reported mortgage loans to white - and only SIX to African Americans.   

 Beyond this disparity which requires denial of this merger application, compare to the industry as a whole in the state of Wisconsin in 2019: 171,953 loans to whites, 2926 to African Americans.   

The industry as a whole in Wisconsin in 2019 made 58.7 loans to whites for every loan to an African American.  

  For Nicolet National Bank, the ratio was FOUR HUNDRED AND SIXTY SEVEN loans to whites for every loan to an African America.     There is more to be said, but on this outrageous record, evidentiary hearings and referrals are required, and the merger application must be withdrawn or denied." Watch this site.

May 10, 2021

In Ripple Case SEC Now Requests Records of All Legal Advice on XRP Compliance with Law

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - ESPN

SDNY COURTHOUSE, May 7 – In SEC v. Ripple Labs Inc. et al., a discovery hearing was held on April 30 before U.S. District Court for the Southern District of New York Magistrate Judge Netburn. Inner City Press live tweeted it, see below, then put underlying emails on Patreon here.

 On May 6, Judge Netburn issued an order: "ORDER granting in part and denying in part [126] Letter Motion for Discovery. Having reviewed the parties' submissions, the Court makes the following clarifications: (1)The SEC must produce communications with third-parties, including external agencies and market participants, subject to a privilege assertion. (2)The SEC need not produce informal intra-agency communications, such as emails, and such communications need not be searched or logged. (3)Intra-agency memoranda or formal position papers discussing Bitcoin, Ethereum, and XRP must be searched for and produced subject to a privilege assertion. Examples of such documents include Division reports, final reports of internal working groups, or formal position papers submitted to the Commissioners. Although such documents may ultimately be privileged, information that would be provided on a privilege log, such as dates and participants, may itself be relevant and is discoverable. (4)Any documents withheld on the basis of privilege must be identified on a privilege log. (5)The Court directs the parties to continue to meet-and-confer on the remaining issues presented in their letters. Respectfully, the Clerk of Court is directed to GRANT in PART the motion at ECF No. 126. (Signed by Magistrate Judge Sarah Netburn on 5/6/2021)."

On May 7, the SEC asked Judge Netburn for a conference to ask for an order compelling Ripple to "produce documents... discussing any legal advice Ripple sought or received as to whether Ripple's offers and sales of XRP were or would be subject to, and incompliance with, the federal securities laws." Then many exhibits are withheld. Watch this site.

From April 30: Netburn: There is not much case law in this area. [That's an understatement.]

Judge Netburn: The SEC's request to a foreign party could be rejected. But once a foreign regulator gets involved, it may be more compulsory.

 Lawyer: These are binding agreements, part of international law. It's not just the SEC calling up and saying, Could you help us? There is a treaty. That's not a request. It's back by the weight and power of the US government. Defendants don't have the same power.

 Lawyer: There should be a level playing field. Once the litigation beings, the SEC should play by the same rules we have do - the Hague Convention, letters rogatory. The SEC has to abide by this.

 Judge: If you agree you and the SEC could use the Hague Convention, what's the difference between that and the SEC's MOU, except that it's a bit easier for the SEC?

Lawyer: We only found out because a foreign party told the company and we raised it to the SEC

Lawyer: Under the Hague Convention, they'd have to make the request to you and we'd see it. Here, the SEC is operating outside the supervision of the court, in secret.

Lawyer: The SEC rushed at the end of the year, as the Administration was turning over. Now they have to play by the rules.

  and CRA?

May 3, 2021

As Crypto Paxos Gets Federal Bank Charter From Still Headless OCC, CRA Litmus Tests

By Matthew R. Lee, Patreon
BBC - Guardian UK - Honduras - The Source

SOUTH BRONX, SDNY, April 26 – In the midst of the Coronavirus pandemic and after the insurrection, then-Comptroller of the Currency Brian Brooks on January 13 gave another quid pro quo gift, a bank charter to Anchorage, even as he quit with a week left in the Administration. Inner City Press asked, Where might he land and get rewarded for all this?

 Then in March we learned: Brooks "has joined blockchain credit startup Spring Labs as its first independent director, the Marina Del Rey, California-based fintech bragged." Revolving / revolting door.

  Now in April at the still headless OCC, another rubber stamp: "The OCC granted a national trust bank charter to Paxos after [a] thorough review of the company and its current operations,” the OCC announced in a press release on April 23. “In granting this charter, the OCC applied the same rigorous review and standards applied to all charter applications." Yeah, rigorous. Where is the renewed enforcement of the CRA? So far, the litmus tests are being failed.  

Paxos was founded in 2012 in New York City, but the company also has offices in Singapore and London as well. At the end of December 2020, Paxos had raised roughly $240 million in financing. The OCC now hands Paxos the authority to exercise fiduciary powers under 12 USC 92a and 12 CFR 5.26. We'll have more on this.

 Meanwhile Inner City Press' requests under the Freedom of Information Act into Brooks' conflicts of interest in the fintech and crypto-currency world have yet to be fully answered.  Did  Brooks take "his" documents with him?

Fair Finance Watch and others opposed and requested extensions on Figure, for which OCC has yet to answer Inner City Press' FOIA request, here

April 26, 2021

Webster Proposed Merger With Sterling Will Be Challenged Based on Disparities, Weak PPP Lending

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - CJR - PFT

SOUTH BRONX / SDNY, April 20– The proposed merger of Webster Financial Corp. and Sterling Bancorp will be challenged, on disparate lending and regulatory evasions.

  Fair Finance Watch has found that in 2019 in its home state of Connecticut, Webster National Bank made 3147 mortgage loans to whites, with 1364 denial to whites - while making only 71 loans to African Americans with fully 99 denials to African American. This is significantly worse than other banks in the state; the merger must be denied.

   Among the comments on the Community Reinvestment Act submitted to the Federal Reserve recently  is one from Webster Bank, arguing that Health Savings Account "deposits should not be considered when determining whether the requirement would apply or when delineating such assessment areas" and should be excluded from the definition of "retail domestic deposits."Consequently, HSAs should also be excluded from  Community Development Financing Metric.

This is scam. 

  Back on May 2, 2020 Fair Finance Watch, and Inner City Press on FOIA, filed a formal challenge with Otting's OCC to the application by Webster Bank to acquire State Farm Bank FSB, its problematic health savings accounts, no less.

   Webster has also under performed in PPP lending:  "the head of Waterbury-based Webster Bank admitted his company can improve its performance in getting money into the hands of loan applicants.  “Certainly we wanted to help every small business borrower and customer of Webster that we could,” said CEO John Ciulla, speaking Tuesday on a conference call. “We got through approximately 30 percent applications approved (and) 30 percent funded, plus or minus a few percentage points on both sides of that." On the CRA comments to the Fed, see NCRC's dashboard, here.

  Sterling has other issues, which Inner City Press previously documented to the OCC leading to delay. What will the still-delayed new Comptroller of the Currency do? Watch this site.

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Your support means a lot. As little as $5 a month helps keep us going and grants you access to exclusive bonus material on our Patreon page. Click here to become a patron.

April 19, 2021

In CRA Test BancorpSouth Bid For Cadence Will Be Challenged To Fed BXS Quit to Evade

By Matthew Russell Lee, Patreon
BBC - Guardian UK - Honduras - ESPN

FEDERAL COURT / S Bronx, April 17 – Whether or not the U.S. Community Reinvestment Act will be again enforced under the new Administration and its regulators is an open question.