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.

February 18, 2019

As Otting Targets Community Reinvestment Act His OCC Starts Safe Harbor Relying On Bogus Ratings

By Matthew R. Lee, Video, story, FOIA docs

NEW YORK CITY, February 13 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency or Ryan Zinke at Interior, is the Office of the Comptroller of the Currency's (OCC's) Joseph Otting. Now under Otting, who is throwing up roadblocks to the release of his calendar under the Freedom of Information Act (see below), "the OCC is instructing examiners to investigate some of the claims separately, rather than addressing them within the merger-approval process.  “We require a certain level of detail and specificity in comments,” Comptroller of the Currency Joseph Otting said in a written statement. 'The changes ensure that concerns are validated by exam staff who are best positioned to review [their] merits.'"

This is a backdoor safe harbor. Since 98% of banks are rated Satisfactory or Outstanding (including those which later are found guilty of discrimination and redlining), to discount comments that are not "validated" by these bogus and inflated rating is regulatory malpractice. Perhaps this is why Otting is hiding his calendar; perhaps the WSJ's Lalita Clozel will dig further. As to the Federal Reserve, Inner City Press has been informed of a memo by a major law firm which has hired and used former Fed Legal Division staff bragging about the fast Fed approvals it is receiving. We'll have more on this - including on BB&T / Suntrust, see here.

February 11, 2019

As Otting Targets Community Reinvestment Act Denies FOIA Fee Waiver For Inner City Press Request For His Calendar For 1st Time

By Matthew R. Lee, Video, story, FOIA docs

NEW YORK CITY, February 9 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency or Ryan Zinke at Interior, is the Office of the Comptroller of the Currency's (OCC's) Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. On January 16 Inner City Press asked the OCC on the expedited basis for records to disclose Otting's meetings with the banking industry and othersBut in a letter dated January 31, the OCC for the first time in years denied Inner City Press' fee waiver request on this one request, despite the request using the same language as requests the OCC has granted for Inner City Press repeatedly. The only difference is the subject of the FOIA request: Otting. This is an abuse of power. Inner City Press has appealed: "Inner City Press is appealing Mr Frank Vance's letter dated January 31, 2019 which denies, for the first time in years, Inner City Press' request for a fee waiver - because the request concerns Comtroller Otting and his schedule. Inner City Press is a media that covers the OCC... it seeks this information to educate the public about the operations of the OCC. The language of the fee waiver request was the same as the OCC has requested granted - now suddenly a new standard is applied, due to the subject matter of the request. This is unacceptable. The denial letter doesn't even inform of the right to appeal, and the request number is not listed in our account - thereby blocking submission of the appeal. We are submitting under the number of another of our 2019 requests on which fee waiver WAS granted, on the same language. We ask for expedited ruling on this appeal, and an explanation."

February 4, 2019


US Settlement Without Fine For Predatory Lending From Malta Needs SDNY Approval Comparative Crime

By Matthew Russell Lee

NEW YORK CITY, February 1 – A dubious settlement of predatory lending claims by the US Consumer Financial Protection Bureau is coming for approval to the US District Court for the Southern District of New York, CFBP announced on Friday afternoon.

The facts of the case are extreme: a lender pretending to be based off-shore in Malta charging interest rates of 700%. But CFPB is settling out the case with no penalties, no restitution, nothing - and asking the SDNY to sign off on it. Will it?   The case is No. 15cv5211 (CM)(RWL) of which the CFPB says "The proposed settlement covers NDG Financial Corp., E-Care Contact Centers, Ltd., Blizzard Interactive Corp., New World Consolidated Lending Corp., New World Lenders Corp., Payroll Loans First Lenders Corp., New World RRSP Lenders Corp., Northway Financial Corp., Ltd., and Northway Broker, Ltd and corporate officials Kimberly DeThomas, Jeremy Sabourin, and William Wrixon. The defendants were not fined."

  These days Inner City Press is covering a range of cases in the SDNY. Not only Michael Cohen, and the back to back UN bribery cases of Ng Lap Seng then Patrick Ho, but also this week's sentencings for the NYPD's guns for cash scandal (18 months in prison) and conspiracy to commit arson in The Bronx (28 months, see below). So what is system predatory lending worth? Doesn't it, too, ravage communities? Compare and contrast... A Bronx man who pled guilty to conspiracy leading to the burning down of a convenience store in the Bronx on 11 September 2016 was sentenced to 28 months in prison on February 1 by Judge William H. Pauley III in the US District Court for the Southern District of New York.

  Arson and The Bronx were for a time synonymous, though few of the perpetrators were caught much less sentenced. Times have changed. Present at Friday afternoon's sentencing on the 20th floor of the Daniel Patrick Moynihan U.S. Courthouse were only the defendant Richard Sanchez and his lawyer, a lone prosecutor, three family members and Inner City Press. Yet the tale was heartbreaking, in its way.

  Sanchez' lawyer Patrick Brackley recounted that he had prior run-ins with the law, citing an incident with a dirt bike. But, he said, Sanchez had used his time out free on bail to re-build his life. Sanchez himself read what he called an open letter to Judge Pawley, speaking about his ten year old daughter, a business he was starting and his brand.

   Judge Pauley said he took note of these but found it inexplicable that someone would, for $500, agree to find people to burn down a store in their own neighborhood. Sanchez was contracted by the owner of one deli to burn down a nearly-open competitor; both stores were across the street from where Sanchez lived. Judge Pauley told Sanchez he was lucky no one had been injured or killed, alluding to the felony murder rule which would have held Sanchez liable.

   While the prosecution via Assistant U.S. Attorney Adam S. Hobson sought a sentence of from 46 to 57 months, Pauley imposed 28 months in prison to be followed by three years of supervised release, at a prison as near to New York City as possible.

   Restitution of $50,000 was ordered, and the same standard $100 mandatory special assessment that SDNY Judge Edgar Ramos had imposed the day before on former NYPD Lieutenant Paul Dean for his admitted role in gun permits for cash scam (see Inner City Press' story here).

  That sentencing drew a gaggle; that of Richard Sanchez for his role in the arson of a store in the Bronx did not. Pauley said to his mostly empty courtroom, The public must understand that people can't be going around burning down stores in their own neighborhood.

The case: United States v. Richard Sanchez, 18 Cr. 26 (WHP)

Upcoming in the SDNY is a just-filed complaint by the Bangladesh Central Bank for the $81 million hacking of its funds, which were then wired through the Federal Reserve Bank of New York, a case that Inner City Press will cover. Times change. Watch this site.

January 28, 2019

Amid Targeting of Community Reinvestment Act Centerstate Bank NCC Challenge Yields Fed Qs

By Matthew R. Lee, Video, story, FOIA docs

NEW YORK CITY, January 11 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. On January 7, Fair Finance Watch and Inner City Press filed comments and a Freedom of Information Act request with the Federal Reserve on Centerstate Bank's application to acquire National Bank of Commerce, despite Centerstate's disparate lending record, see below. On January 25, the Federal Reserve belatedly sent questions to CenterState, with a copy to Inner City Press: "This letter concerns the application filed under section 3 of the Bank Holding Company Act by CenterState Bank Corporation (“CenterState”), Winter Haven, Florida, to merge with National Commerce Corporation (“NCC”) and thereby acquire National Bank of Commerce (“Bank of Commerce”), both of Birmingham, Alabama. Based on staff’s review of the current record, the following additional information is requested. Respond to all requests, including those in the confidential annex. Supporting documentation, as appropriate, should be provided. 1. Indicate whether CenterState will discontinue or reduce any products or services of Bank of Commerce after consummation of the proposal. If so, discuss any efforts to mitigate the effects of such discontinuance or reduction.

2. Provide the address of any branches of Bank of Commerce that CenterState intends to close or consolidate after consummation of the proposal. Discuss any efforts to mitigate the effects of any such closing(s) or consolidation(s).

3. Discuss the efforts that CenterState will take to ensure a smooth transition for customers of Bank of Commerce to CenterState Bank, NA, Winter Haven, Florida. Your response should further elaborate on how CenterState will seek to avoid the types of issues alleged in the public comment concerning customer experiences during transitioning service to CenterState Bank, NA. Discuss also how CenterState will ensure a successful integration of others systems of NCC and Bank of Commerce with those of CenterState and CenterState Bank, NA.

4. Indicate to what extent CenterState Bank’s CRA and consumer compliance, including fair lending, programs would be implemented at Bank of Commerce. In addition, indicate the key individuals who would be responsible for these programs, as well as their qualifications and experience. Please submit your response to the Federal Reserve Bank of Atlanta within eight business days. In addition, in accordance with the Board’s procedures regarding ex parte communications, provide a copy of the public portion of your response, together with any attachments, directly to the commenter. Any information for which you desire confidential treatment should be so labeled and separately bound in accordance with section 261.15 of the Board’s Rules Regarding Availability of Information." We'll have more on this. On January 11, having been sent documents showing that Centerstate is trying to withhold most of its exhibits, Inner City Press filed "This is a second timely comment on the over-withheld Applications of Centerstate Bank Corporation, Winter Haven, Florida to merge with National Commerce Corporation, and thereby indirectly acquire National Bank of Commerce.    On January 7 Inner City Press / Fair Finance Watch submitted an initial comment and requested a copy of the full Application, under FOIA and through the Reserve Bank. So far, what has been sent to Inner City Press has no portion at all of the only substantive Exhibits, B, C and D. The only Exhibits provided are the merger agreements and the form of newspaper notice.  This is an abuse, and the comment period must be extended so that comment on the wrongfully withheld exhibits can be made. It is impossible to believe that there are no segregable non exempt portions of those exhibits. Inner City Press already has a FOIA request pending and so is not confusing the matter by submitting another FOIA request.  The FRB should not countenance such strategic secrecy by this applicant. This is a specific timely request that the comment period be extended and the information provided.

Fair Finance Watch has been tracking Centerstate Bank:

In 2017 in the Orlando, Florida MSA for home purchase loans, Centerstate made 108 such loans to whites - and only TWO to African Americans, and only ten to Latinos. Its denial rate for Latinos was 3.6 times higher than for whites, and for African Americans 2.66 times higher than for whites, both most disparate that the industry as a whole.

In 2017 in the Miami, Florida MSA for home purchase loans, Centerstate made 14 such loans to whites - and only three  to African Americans.

In 2017 in the Tampa, Florida MSA for conventional home purchase loans, Centerstate made 130 such loans to whites - and only 1 each to African Americans and to Latinos.

In 2017 in the Jacksonville, Florida MSA for conventional home purchase loans, Centerstate made 18 such loans to whites - and none to African Americans and to Latinos (it denied the only application which, based on its disparate outreach, it received from people of color, a Latino applicant.)

In 2017 in the Lakeland - Winter Haven, Florida MSA for conventional home purchase loans, Centerstate made 160 such loans to whites - and only four to African Americans and only eight to Latinos (it denied Latino applicants 2.7 time more frequently than whites.)

  This should also be address in this proceeding, including at the requested evidentiary hearing - CenterState has a history of mishandling mergers, and arrogantly ignoring consumer complaints, standing behind excuses rebutted by the consumers..

On Otting, there is and will be fight-back, under NCRC's TreasureCRA campaign and upcoming conference. Watch this site - including on actual enforcement of CRA.

January 21, 2019

As Otting Targets Community Reinvestment Act Inner City Press Requests His Calendar Under FOIA

By Matthew R. Lee, Video, story, FOIA docs

NEW YORK CITY, January 19 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency or Ryan Zinke at Interior, is the Office of the Comptroller of the Currency's (OCC's) Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. And now on January 16 Inner City Press asked the OCC on the expedited basis for records to disclose Otting's meetings with the banking industry and others:  "Dear OCC FOIA Officer: Inner City Press / Fair Finance Watch (ICP) makes this request for records pursuant to the Freedom of Information Act (“FOIA”), 5 U.S.C. § 552, and OCC regulations. ICP requests copies of records sufficient to show all of Comptroller Otting's scheduled meetings, appointments, and scheduled events from the date he became Comptroller to the date of your response including but not limited to Outlook calendar entries and daily briefing books for Comptroller Otting on those dates... ICP requests that you expedite the processing of this request. There is media interest and there exist possible questions concerning the OCC's integrity, which affect public confidence. See e.g. this article and the CRA ANPR since." We'll have more on this.

January 14, 2019

Amid Targeting of Community Reinvestment Act Centerstate Bank Takeover of NCC Challenged on Disparate Lending

By Matthew R. Lee, Video, story, FOIA docs

ORLANDO, January 7 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. On January 7, Fair Finance Watch and Inner City Press filed comments and a Freedom of Information Act request with the Federal Reserve on Centerstate Bank's application to acquire National Bank of Commerce, despite Centerstate's disparate lending record: "

This is a request for a full copy of, and a timely first comment on, the Applications of Centerstate Bank Corporation, Winter Haven, Florida to merge with National Commerce Corporation, and thereby indirectly acquire National Bank of Commerce.

As an initial matter, this is a request that the FRS immediately send by email to Inner City Press all non-exempt portions of the applications / notices for which the Applicants have requested confidential treatment.

Fair Finance Watch has been tracking Centerstate Bank:

In 2017 in the Orlando, Florida MSA for home purchase loans, Centerstate made 108 such loans to whites - and only TWO to African Americans, and only ten to Latinos. Its denial rate for Latinos was 3.6 times higher than for whites, and for African Americans 2.66 times higher than for whites, both most disparate that the industry as a whole.

In 2017 in the Miami, Florida MSA for home purchase loans, Centerstate made 14 such loans to whites - and only three  to African Americans.

In 2017 in the Tampa, Florida MSA for conventional home purchase loans, Centerstate made 130 such loans to whites - and only 1 each to African Americans and to Latinos.

In 2017 in the Jacksonville, Florida MSA for conventional home purchase loans, Centerstate made 18 such loans to whites - and none to African Americans and to Latinos (it denied the only application which, based on its disparate outreach, it received from people of color, a Latino applicant.)

In 2017 in the Lakeland - Winter Haven, Florida MSA for conventional home purchase loans, Centerstate made 160 such loans to whites - and only four to African Americans and only eight to Latinos (it denied Latino applicants 2.7 time more frequently than whites.)

  This should also be address in this proceeding, including at the requested evidentiary hearing - CenterState has a history of mishandling mergers, and arrogantly ignoring consumer complaints, standing behind excuses rebutted by the consumers, for example:

"For over a day, I haven't been able to access money in my account because CenterState is having issues transferring ********* accounts in their system I was a customer of**********************, which was recently acquired by CenterState Bank.

As of May 18th, I haven't been able to access my account online. I called customer services, and they told me that I would have access by May 19. I was also told that they could not provide me any information about my balance. I still didn't have any access on May 19, so I called again and was told to wait longer and then they rudely hung up on me. I still have no information on my account and cannot withdraw my money. I searched for the nearest branch so that I can visit it, get my money and close my account, but they are all closed until Monday. I am concerned because I rely on this money for emergencies and to pay for mine and my children's food, bills, and more. 

I expect CenterState bank to comply with their obligations to their customers by 1) providing me access to my account and my money, 2) allowing me to close my account immediately upon visiting their branch next Monday, 4) apologize for the inconvenience and mistreatment from their customer service employee. 

CenterState Bank of Florida, N.A. Response 05/25/2018  CenterState Bank sincerely appreciates the account relationship that Ms.******* had established with**********************. Leading up to and during the conversion process, the two banks worked closely together to make sure the conversion process went as smoothly as possible. Customer communication regarding products, services, online banking and debit cards was mailed to the address on file with********************** to all of their customers within the required thirty day timeframe before the conversion weekend, the systems were transferring files between the two banks, which resulted in certain services (such as a account balance information) being unavailable. Communication sent to all********************** customers in at least two mailings prior to the conversion date specifically addressed that account balances would not be available until the conversion process was complete sometime over the weekend or possibly the Monday morning of the 21st. Additional staff was added to our Customer Care call center to handle anticipated call volume over the weekend and into this week. The Bank sincerely apologizes for the alleged treatment received by our Customer Care team when Ms.******* called on Saturday, May 19th to inquire about her balance. It is never our intention to be rude to any of our customers. In an effort to answer as many calls as efficiently as possible, the team was perhaps less likely to encourage additional conversation than normal. Please be advised that account balances and all other functions were working as intended on Monday morning, May 21st. It has been noted that Ms.******* did close her account with our Bank on Monday, May 21st. We would like to extend the invitation to her to consider CenterState Bank for any additional banking needs that she might have in the future. 

Customer Response 06/07/2018  (The consumer indicated he/she DID NOT accept the response from the business.) CenterState Bank stated that "account balances and all other functions were working as intended on Monday morning, May 21st;" but it was not. Before closing my account, I was still unable to log in to my account. ... They also claim that "additional staff was added to their Customer Care call center to handle anticipated call volume over the weekend and into this week." However, their website stated that customer service were unavailable, and only branches or electronic forms were available. Please see attachment. As their response above indicates, I closed my account thereafter, but am disappointed with their service and lack of effort to try to make up for this inconvenience. Therefore, I have NO intention of recommending them or doing business with them in the future. 

CenterState Bank of Florida, N.A. Response CenterState Bank submitted a response in reference to *************'s complaint on May 25, 2018. We feel we have addressed her dissatisfaction and apologized for her inconvenience. We stand by our original response."

  This is indicative of the approach that would be taken to the new customers Centerstate is trying to acquire. Inner City Press is also concerned about the potential for branch closing(s), and loss of local accountability.

  ICP is requesting evidentiary hearings and that this proposed acquisition, on the current record, not be approved. There is no public benefit."

January 7, 2019

Amid Targeting of Community Reinvestment Act Fed Delays on FOIA for WSFS CRA Program

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, January 3 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency or Ryan Zinke at Interior, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. At the November 19 deadline, not yet posted was Inner City Press' November 17 fourth comment, just as Otting's OCC absurdly waited 13 days to try to rule it does not have to consider Fair Finance Watch's comments on WSFS Bank's application to acquire Beneficial. Now, after the OCC gleefully closed its comment period on that, WSFS on December 13 announced it will close 25 branches. One would think Otting would have to re-open the comment period. But that's not how Otting rolls. And the Fed, on FOIA, is absurd. On January 2 the Federal Reserve unilaterally extended its time to respond to Inner City Press' FOIA request about WSFS and CRA - without any commitment to no haul off and rubber stamp the application. Here's what the Fed wrote: "Mr. Matthew R. Lee  Inner City Press  P.O. Box 20047  Dag Hammarskjold Station  New York, NY 10017     Re:       Freedom of Information Act Request No. F-2019-00040     Dear Mr. Lee,     On December 3, 2018, the Board of Governors (“Board”) received your electronic message dated December 1, pursuant to the Freedom of Information Act (“FOIA”), 5 U.S.C. § 552, for all withheld portions of the applications by WSFS to acquire Beneficial, including but not limited to presumptively mis-labeled “Confidential” exhibits about WSFS's CRA program (“Confidential” Exhibit 9)... Pursuant to section (a)(6)(B)(i) of the FOIA, we are extending the period for our response until January 16, 2019, in order to consult with two or more components of the Board having a substantial interest in the determination of the request.     If a determination can be made before January 16, 2019, we will respond to you promptly. It is our policy to process FOIA requests as quickly as possible while ensuring that we disclose the requested information to the fullest extent of the law.     Thank you,     Freedom of Information Office  Board of Governors of the Federal Reserve System."

December 31, 2018

Mnuchin Calls Big Six Banks and Monday Convenes Powell and Otting Amid Targeting of Community Reinvestment Act

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, December 23 – US Treasury Department Steve Mnuchin on Sunday from Cabo called six big US banks: "Brian Moynihan, Bank of America; Michael Corbat, Citi; David Solomon, Goldman Sachs; Jamie Dimon, JP Morgan Chase, James Gorman, Morgan Stanley; Tim Sloan, Wells Fargo. The CEOs confirmed that they have ample liquidity available for lending to consumer, business markets, and all other market operations. He also confirmed that they have not experienced any clearance or margin issues and that the markets continue to function properly.

Tomorrow, the Secretary will convene a call with the President’s Working Group on financial markets, which he chairs. This includes the Board of Governors of the Federal Reserve System, the Securities and Exchange Commission, and the Commodities Futures Trading Commission. He has also invited the office of the Comptroller of the Currency." That's Joseph Otting, with whom Mnuchin worked at and on selling OneWest Bank to CIT Group, complete with falsified pro-merger comments Inner City Press reported on. Otting's OCC is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. At the November 19 deadline, not (yet) posted was Inner City Press' November 17 fourth comment, just as Otting's OCC absurdly waited 13 days to try to rule it does not have to consider Fair Finance Watch's comments on WSFS Bank. But Inner City Press has timely protested WSFS to the Federal Reserve - and has now found out that WSFS is even trying to withhold its CRA information from the public, photo here. So Inner City Press has submitted this Freedom of Information Act request: "
This is a FOIA request for the all withheld portions of the applications by WSFS to acquire Beneficial, including but not limited to presumptively mis-labeled “Confidential” exhibits about WSFS's CRA program (“Confidential” Exhibit 9), (Beneficial's subsidiaries (“Confidential” Exhibit 3), Board of Directors resolutions, due diligence (“Confidential” Exhibit 10), operating economy / cost savings (there are branch closings projected), names of prospective managers (ages, requested on application, apparently not provided), and for all records reflecting FRS communications with WSFS or Beneficial or their affiliates for the past twelve (12) months." A fifth comment submitted including that "the OCC is already undermining CRA. Our comments to the OCC on WSFS - Beneficial have yet to be acted on. That comment was submitted on November 6. Now on November 19, two weeks later, the OCC has tellingly said it will not consider it - despite a Federal Reserve Board comment period on the same transaction remaining open until at least November 27. The OCC's attempt to ignore substantive criticism of some banks' performance, while Comptroller Otting previously solicited false comments support his OneWest Bank, are a symbol all what is wrong with this process, and today's OCC.
   While if the past is any guide the OCC will forwarded ICP's comment to the FRB by the FRB, we note in this connection that WSFS' comments on the ANPR favor, as Otting clearly does, dulling the LMI focus of CRA to make it easier for banks.  We oppose all of this.

December 24, 2018

Amid Targeting of Community Reinvestment Act FFW Protest of WSFS Leads to CRA Questions Here

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, December 18 – The US Treasury Department is the next stage of a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency or Ryan Zinke at Interior, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. At the November 19 deadline, not yet posted was Inner City Press' November 17 fourth comment, just as Otting's OCC absurdly waited 13 days to try to rule it does not have to consider Fair Finance Watch's comments on WSFS Bank's application to acquire Beneficial. Now, after the OCC gleefully closed its comment period on that, WSFS on December 13 announced it will close 25 branches. One would think Otting would have to re-open the comment period. But that's not how Otting rolls. Here now from the Federal Reserve, to which FFW also commented, are the Fed's Additional Information questions sent December 18 to WSFS and FFW: "This request refers to the application by WSFS Financial Corporation (“WSFS”),
Wilmington, Delaware, to acquire Beneficial Bancorp, Inc. (“Beneficial”), and thereby
indirectly acquire Beneficial Bank (“Beneficial Bank”), both of Philadelphia,
Pennsylvania, pursuant to section 10(e) of the Home Owners’ Loan Act following the
conversion of Beneficial from a bank holding company to a savings and loan holding
company. Following the proposed acquisition, WSFS plans to merge Beneficial Bank
into its subsidiary, Wilmington Savings Fund Society, FSB (“WSFS Bank”),
Wilmington, Delaware. Based on our review of the current record, the following
information, including the information in the Confidential Appendix, is requested.
Please provide relevant supporting documentation, as appropriate.
1. Provide a description of WSFS’s current non-banking activities, including any
commercial activities referenced in Item 210.50(a), and identify the authority
upon which WSFS relies to engage in such activities, as well as any supportive
analysis.
2. Provide the following required components of the H(e)-3 Application:
a. Confidential disclosure memoranda to the Merger Agreement, required as
part of Item 110.10(b)
b. Evidence of shareholder approval of the transaction, required as part of
Item 110.10(d)
c. Parent company (unconsolidated) cash flows statements, referenced in
Item 330.10(d)
d. The ages of WSFS’s and Beneficial’s directors and senior executive
officers, referenced in Item 410.10(c)-1
e. An amended charter and/or amended by-laws, if either will be revised as
a result of the proposed mergers, referenced in Exhibit B.1

3. To the extent not already provided, provide an update on WSFS Bank’s Community Reinvestment Act (“CRA”) activities since its August 2017 CRA Performance Evaluation and Beneficial Bank’s CRA activities since its July 2017 CRA Performance Evaluation, in assessment areas in which the banks operate. This response should include any significant CRA initiatives undertaken, particularly with respect to credit and deposit products and retail banking services targeted toward low- and moderate-income (“LMI”) geographies and individuals, as well as information on community development lending, investments, and services WSFS Bank and Beneficial Bank have made since the banks’ last evaluation period, including the total
number, dollar amount, and service hours, and a brief description of the banks’ most significant community development loans, investments, and services.
4. Revise the pro forma financial statements that were submitted on November
27, 2018, to reflect actual reported balance sheet information for Beneficial
(total assets balance should match the balance reported on FR-Y9C) and
update the relevant footnote adjustments based on information as of September
30, 2018 (footnote adjustments related to accumulated other comprehensive
income and retained earnings are currently based on information as of June 30,
2018).
5. Provide a parent company only (unconsolidated) balance sheet as of the end of
the most recent quarter, showing separately each principal group of assets,
liabilities, and capital account components (e.g., common stock and preferred
stock, surplus, accumulated other comprehensive income, and retained
earnings), debit and credit adjustments (explained by detailed footnotes)
reflecting the proposed transaction; and the resulting pro forma parent
company balance sheet. The pro forma balance sheet should reflect the
adjustments required under business combination and fair value accounting
standards.
6. Clarify whether any of WSFS’s Integration Plan activities discussed in
WSFS’s response to Question 5 of the OCC’s Additional Information Request
(dated November 15, 2018) would include integration of any of WSFS’s and
Beneficial’s IT systems prior to WSFS’s receipt of the Federal Reserve’s
approval of the transaction.
7. Provide a breakdown of the branches that the combined bank intends to retain
after the merger, including whether any will be in low- or moderate-income or
majority-minority census tracts.
8. In the H(e)-3 application, WSFS states that it will seek “to incorporate
Beneficial Bank’s highly successful strategies for meeting the needs of its
communities into the combined institution’s CRA programs.” Please elaborate
on this statement, including a discussion of what strategies WSFS plans to
incorporate. Please indicate whether the incorporated strategies will be utilized across the entire footprint of the combined bank or in the current footprint of Beneficial Bank.
9. Please confirm that, upon merger, WSFS will commit to comply with 12 CFR 239.62, as that section may be amended from time to time by the Board of Governors of the Federal Reserve System (the “Board”) with respect to
Beneficial’s liquidation account.
Please submit your response within ten business days, addressed to Eddy Hsiao at
the Federal Reserve Bank of Philadelphia. In addition, to facilitate more timely
distribution of information, please submit your full response on E-Apps, the Federal
Reserve’s web-based system for electronic submission of regulatory applications and
related documents.
In accordance with the Federal Reserve’s ex parte procedures, provide a copy of the public portion of your response (together with any attachments) directly to the commenter, Mr. Matthew Lee of Fair Finance Watch. In addition, please send a copy of your response to your application contacts at the Office of the Comptroller of the Currency." But wasn't the OCC's comment period closed?

December 17, 2018


At CFPB Kraninger Sworn In Without Press But Texas Bankers Present Now Electronic Media Out in 5 Minutes

By Matthew R. Lee, IMF Coverage

NEW YORK CITY / DC, December 11 – With the Consumer Financial Protection Bureau having sworn in Kathy Kraninger without any press present - but with the Texas Bankers Association in the house - on December 11 Kraninger will hold a strangely controlling media availability. Only the first five minutes will be on camera; after that all "electronic media" will be kicked out. This is 2018, and this is the agency ostensibly set up to protect the public. Here is CFPB's notice: "Kathy Kraninger, the new director of the Bureau of Consumer Financial Protection, will hold a media availability for credentialed press only at the Bureau’s headquarters at 2:30 p.m. Tuesday, Dec. 11.

Who: Kathleen Kraninger, Director, Bureau of Consumer Financial Protection.

Where: Bureau of Consumer Financial Protection, 1700 G St. NW, Washington, D.C., B-Level conference room area.

When: Dec. 11, 2:30 p.m.

Photo Ops: Up to five minute photo/video opportunity at beginning of the availability.

Reporters: Pen and pad Q&A with accredited media only. Members of the press attending must have a White House or congressional media credential. Electronic media will only be permitted during the first five minutes of the news availability." This is not an auspicious beginning.

December 10, 2018


Cadence Bank Urged OCC To Speed Regulatory Approvals And Gets It From The Fed Despite Jumping the Gun

By Matthew R. Lee, Video, 7/31 story

SOUTH BRONX, December 7 – Cadence Bancorporation which has a disparate lending record while apply to buy State Bank in Georgia and urging faster regulatory approvals, seemingly jumped the gun before having the required Federal Reserve Board approval. But the Fed in a December 7 order shrugged it off in a footnote (22), "The commenter’s allegation that the parties are operating as a single entity prior to theBoard’s approval of the proposal related to an investor conference call during which the Chief Executive Officer of Cadence stated that he intended to refer a Cadence customer to a division of State Bank. The Board does not generally view a customer referral,
without more, as constituting prior control of an entity." Fair Finance Watch is the commenter: On October 18, Fair Finance Watch submitted a timely comment to the Federal Reserve Board in Washington, below - and got back a copy of a letter from the Federal Reserve Bank of Dallas forwarding its comment to Cadence's outside counsel at Wachtell Lipton -- Patricia Robinson, who used to be with the Fed's Legal Division. Inner City Press will have more on that. Now on November 20 the Fed has extended its time to respond to Inner City Press' FOIA request, the day after Cadence commented to Joseph Otting's OCC's Advance Notice of Proposed Rulemaking urging his OCC to "make the application process for expansionary actions less contentious." How about not making frivolous requests to have regulators withhold information until they hope the "expansionary action" is consummated?  Here's from FFW's comment: "This is a request for a full copy of, and a timely first comment on, the Applications of Cadence Bancorporation, Houston, Texas; to acquire State Bank Financial Corporation, Atlanta, Georgia, and thereby indirectly acquire State Bank and Trust Company, Macon, Georgia

As an initial matter, this is a request that the FRS immediately send by email to Inner City Press all non-exempt portions of the applications / notices for which the Applicants have requested confidential treatment.

Fair Finance Watch has been tracking Cadence Bank: In 2017 in the Dallas, Texas MSA for convention home purchase loans, Cadence made 99 such loans to whites - and NONE, not a single origination, to African Americans.

In 2017 in the Houston Texas MSA for convention home purchase loans, Cadence made 236 such loans to whites - and only 15 to African Americans, and only 23 to Latinos. This is not in keeping with the aggregate, which made 37,128 such loans to whites, 3151 to African Americans and 8215 to Latinos.

In 2017 in the Birmingham, Alabama MSA for convention home purchase loans, Cadence made 66 such loans to whites - and only ONE to African Americans. Even combining in Table 4-1, it was 79 home purchase loans to whites and only THREE to African Americans.

This should also be address in this proceeding, including at the requested evidentiary hearing:

“Cadence Bank - Racist manager

2800 Post Oak Blvd Suite 101, Houston, TX 77056, USA

I had my 2 business accounts at the Williams tower location, I tried talking to the manager about small business loans she always avoided me looking at me kind of weird whenever I done withdrawals she always asked me why I'm taking money out after 3 months she sent me a Leter saying she's going to be closing my account because I take money out ones a week for payroll and she didn't like that.”

Inner City Press is also concerned about this statement imply gun-jumping, in the investors' call announcing the proposal, here.

Paul Murphy: “Oh boy, you’re right. It’s not in the model. It’s significant. I mean, there is just a lot of overlap. I’ve got a prospect for AloStar. I’m going to see them this afternoon. We can start it on a great potential new piece of business for them today. And there will be more and more of that.”

ICP is requesting evidentiary hearings and that this proposed acquisition, on the current record, not be approved. There is no public benefit." Here's how the Fed boiled it down, with FOIA issues outstanding: "One commenter objected to the proposal on the basis of alleged disparities
in the number of home mortgage loans made by Cadence Bank to African Americans in
the Dallas-Plano-Irving, Texas Metropolitan Division (“Dallas MD”) and the
Birmingham-Hoover, Alabama Metropolitan Statistical Area (“Birmingham MSA”), and
to African Americans and Latinos in the Houston-The Woodlands-Sugar Land, Texas
Metropolitan Statistical Area (“Houston MSA”), in each case as compared to whites inthe relevant areas, based on data reported under the Home Mortgage Disclosure Act of 1975 (“HMDA”). The commenter also cited a customer complaint alleging racist
management practices at Cadence Bank." And? On Synovus - FCB, the Fed brags that the Board consulted with the (its) Reserve Bank. And?

December 3, 2018


Targeting of Community Reinvestment Act by Otting Included Favor to WSFS Now Fed Protest by Fair Finance Watch

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, November 28 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. At the November 19 deadline, not (yet) posted was Inner City Press' November 17 fourth comment, just as Otting's OCC absurdly waited 13 days to try to rule it does not have to consider Fair Finance Watch's comments on WSFS Bank.A fifth comment submitted including that "the OCC is already undermining CRA. Our comments to the OCC on WSFS - Beneficial have yet to be acted on. That comment was submitted on November 6. Now on November 19, two weeks later, the OCC has tellingly said it will not consider it - despite a Federal Reserve Board comment period on the same transaction remaining open until at least November 27. The OCC's attempt to ignore substantive criticism of some banks' performance, while Comptroller Otting previously solicited false comments support his OneWest Bank, are a symbol all what is wrong with this process, and today's OCC.
   While if the past is any guide the OCC will forwarded ICP's comment to the FRB by the FRB, we note in this connection that WSFS' comments on the ANPR favor, as Otting clearly does, dulling the LMI focus of CRA to make it easier for banks.  We oppose all of this.

November 26, 2018

Targeting of Community Reinvestment Act by Otting Includes Favor to WSFS Which Disses LMI Focus

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, November 19 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. Now at the November 19 deadline, as of 4 pm, there was 773 comments online, but 802 listed. Among those not (yet?) posted is Inner City Press' November 17 fourth comment, just as Otting's OCC absurdly waited 13 days to try to rule it does not have to consider Fair Finance Watch's comments on WSFS Bank. So, a fifth comment just submitted including that "the OCC is already undermining CRA. Our comments to the OCC on WSFS - Beneficial have yet to be acted on. That comment was submitted on November 6. Now on November 19, two weeks later, the OCC has tellingly said it will not consider it - despite a Federal Reserve Board comment period on the same transaction remaining open until at least November 27. The OCC's attempt to ignore substantive criticism of some banks' performance, while Comptroller Otting previously solicited false comments support his OneWest Bank, are a symbol all what is wrong with this process, and today's OCC.
   While if the past is any guide the OCC will forwarded ICP's comment to the FRB by the FRB, we note in this connection that WSFS' comments on the ANPR favor, as Otting clearly does, dulling the LMI focus of CRA to make it easier for banks.  We oppose all of this.
   Since October 11 the OCC has denied expedited process to our FOIA request(s) for records essential in order to comment on this proposal. OCC Deputy Chief Counsel Charles Steele on November 7 wrote on that “merger between One West Bank and CIT Bank. You do not demonstrate how your request concerns a matter of current exigency to the American public or how a delay in the OCC's response to your request would compromise a significant recognized interest.” Given the false commenting issues in the OneWest - CIT proceeding, and the importance of CRA to our communities, this denial is insulting and further makes this ANPR commenting process, ostensibly closing now on November 19, illegitimate."  Among them, as reviewed by Inner City Press:
Fulton Financial, on which ICP has previously comment, perhaps understandably given its lending record urges “De-couple CRA from Fair Lending... CRA and Fair Lending have complementary but different social and policy objectives. CRA ratings should not be downgraded based on the results of a bank's fair lending performance and exam results.” FFW disagrees: racial discrimination in lending means a bank is NOT meeting the credit needs of its entire community.

The ABA writes that “'needs to improve' CRA rating and should clarify that such a rating will not be a de facto bar to opening new branches or engaging in other activities requiring regulatory approval.” FFW disagrees: a bank with a rare NTI (or Substantial Non-compliance) record should be barred from merging or expanding. This is the enforcement mechanism of CRA.

Th Association of Military Banks of America urges, “Because the financial challenges military communities face are less dependent on income distinctions than in geographically-defined communities, we recommend that all financial services to the military community should be presumed to qualify for CRA credit, regardless of whether the recipient fits within a classic LMI category.” FFW disagrees with this blurring of the lines. Loans to five star generals are not CRA loans.

Heartland Tri State Bank says “Any bank with assets less than One Billion Dollars should not be subject to CRA examinations.” FFW disagrees, precisely because such banks play (or don't play) such a role in the economies of some communities.

   Meanwhile the OCC is already undermining CRA.  The OCC has denied expedited process to our FOIA request(s) for records essential in order to comment on this proposal. OCC Deputy Chief Counsel Charles Steele on November 7 wrote on that “merger between One West Bank and CIT Bank. You do not demonstrate how your request concerns a matter of current exigency to the American public or how a delay in the OCC's response to your request would compromise a significant recognized interest.” Given the false commenting issues in the OneWest - CIT proceeding, and the importance of CRA to our communities, this denial is insulting and further makes this ANPR commenting process, ostensibly closing on November 19, illegitimate, we contend - while joining in NCRC's comments, see below. On November 6 at 5 pm, before any midterm elections results came in, Fair Finance Watch filed comments at deadline with Otting's OCC, on Wilmington Savings Fund Society (WSFS) Bank's application to acquire Beneficial Bank in Philadelphia and closed 30 branches, despite WSFS' disparate lending record: "This is a timely first comment opposing and requesting an extension of the OCC's public comment period on the Application by WSFS Bank to Acquire Beneficial Bank. In the the Wilmington MSA in 2017, WILMINGTON SAVINGS FUND SOCIETY, FSB (WSFS Bank) had a denial rate for the home purchase loan applications of African Americans that was 5.48 times higher than for whites - an outrage, significantly more disparate that other banks in the market. For Latinos, WSFS Bank was and is worse, with a denial rate for home purchase loans 7.43 times higher for Latinos than for whites.
   This is not a lending record and pattern to impose on Philadelphia. And consider this: if approved, WSFS “plans to close 30 WSFS and Beneficial Bank offices, a quarter."
   See, “WSFS bosses Mark Turner and Rodger Levenson plan to close 30 of the combined companies’ 120 branches and eliminate around 350 of their 2,100 jobs.”
   There is more to say, and there are more markets. But concerned as we are about the OCC seeming to take outrageous disparities even less seriously than before, we ar timely submitting this one, for your action. This is systematic redlining; this proposed acquisition could not legitimately be approved and WSFS Bank should be referred for prosecution for redlining by the Department of Justice and the CFPB. But will today's OCC do it? The branch closings provides a second ground for the requested evidentiary hearing." What will Otting's OCC do?

November 19, 2018

Community Reinvestment Act Targeting by Otting Urged On By ABA Fulton and Military Banks

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, November 17 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. Now just before the November 19 deadline, in a single hour on November 17 the reported number of comment suddenly dropped from 677 to 609. Among them, as reviewed by Inner City Press: Fulton Financial, on which ICP has previously comment, perhaps understandably given its lending record urges “De-couple CRA from Fair Lending... CRA and Fair Lending have complementary but different social and policy objectives. CRA ratings should not be downgraded based on the results of a bank's fair lending performance and exam results.” FFW disagrees: racial discrimination in lending means a bank is NOT meeting the credit needs of its entire community.

The ABA writes that “'needs to improve' CRA rating and should clarify that such a rating will not be a de facto bar to opening new branches or engaging in other activities requiring regulatory approval.” FFW disagrees: a bank with a rare NTI (or Substantial Non-compliance) record should be barred from merging or expanding. This is the enforcement mechanism of CRA.

Th Association of Military Banks of America urges, “Because the financial challenges military communities face are less dependent on income distinctions than in geographically-defined communities, we recommend that all financial services to the military community should be presumed to qualify for CRA credit, regardless of whether the recipient fits within a classic LMI category.” FFW disagrees with this blurring of the lines. Loans to five star generals are not CRA loans.

Heartland Tri State Bank says “Any bank with assets less than One Billion Dollars should not be subject to CRA examinations.” FFW disagrees, precisely because such banks play (or don't play) such a role in the economies of some communities.

   Meanwhile the OCC is already undermining CRA.  The OCC has denied expedited process to our FOIA request(s) for records essential in order to comment on this proposal. OCC Deputy Chief Counsel Charles Steele on November 7 wrote on that “merger between One West Bank and CIT Bank. You do not demonstrate how your request concerns a matter of current exigency to the American public or how a delay in the OCC's response to your request would compromise a significant recognized interest.” Given the false commenting issues in the OneWest - CIT proceeding, and the importance of CRA to our communities, this denial is insulting and further makes this ANPR commenting process, ostensibly closing on November 19, illegitimate, we contend - while joining in NCRC's comments, see below. On November 6 at 5 pm, before any midterm elections results came in, Fair Finance Watch filed comments at deadline with Otting's OCC, on Wilmington Savings Fund Society (WSFS) Bank's application to acquire Beneficial Bank in Philadelphia and closed 30 branches, despite WSFS' disparate lending record:

November 12, 2018

As Community Reinvestment Act Is Targeted by Otting Inner City Press FOIA Appeal Denied Nov 19 Scam

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, November 9 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency (and soon it would seem to be subject to greater oversight in the House Banking Committee), is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. On October 16, yet more on Otting's assault on the CRA became known. Under him, the OCC has ignored the rare racial redlining settlement by Klein Bank, rubber stamping Old National's acquisition of the bank over the timely and detailed objection and public hearing request of Fair Finance Watch. Otting doesn't like public hearings.  In April 2018 his OCC approved an application by E-Trade Saving Bank which Fair Finance Watch had challenged based on the bank having no fewer than six states rare "Needs to Improve" CRA ratings. FFW noted rare Needs to Improve ratings for the entire states of Arizona, Colorado, Florida, Georgia, Michigan and Oregon, and an undeserved “Satisfactory” for New York. Otting's OCC, after the approval, helpfully contacted E-Trade Bank to tell it that upon (Otting's) reflection, it was no longer even subject to the Community Reinvestment Act. Another institution was similarly contacted - the OCC under Otting is going through its roster of banks seeing which ones it can "free" from CRA even if they hadn't requested in. In one case, some in the bank still didn't want Otting's freedom and move more business into the bank to get a second reversal of Otting's orders. But it shows where Otting is coming from, beyond the unexplained comment-fraud for which he should be recused. Inner City Press on October 11 raised the E-Trade (and another bank) issue into the record on the Advanced Notice of Proposed Rulemaking. But, Otting being Otting, his OCC denied expedited processing for Inner City Press' Freedom of Information Act request bout his deregulation move, ruling that "You requested all records in the OCC's possession concerning the applicability of the Community Reinvestment Act to - or exemption there from - any affiliate of E-Trade or Bank of America California NA for the time period of October 11, 2016 to October 11, 2018. You also requested expedited processing of your request on the basis that the ANPR on CRA is open through November 19, 2018. Your request for expedited processing does not meet the criteria provided for in 5 U.S.C. 552(a)(6)(E) and Treasury disclosure regulations at 31 C.F.R. 1.5(e)." And that regulation... requires a formal certification. So Inner City Press appealed: "As a  a person primarily engaged in disseminating information, I am appealing the denial of expedited processing of my FOIA request, summarized by the OCC as for all records in the OCC's possession concerning the applicability of the Community Reinvestment Act to - or exemption there from - any affiliate of E-Trade or Bank of America California NA for the time period of October 11, 2016 to October 11, 2018.
...The OCC under Joseph Otting's actions to try to find banks to exempt from CRA outrageous and something on which there is an  urgency to inform the public concerning actual or alleged Federal Government activity. As noted in my request, this is particularly the case given the OCC's unilateral moves regarding the CRA. I declare under penalty of perjury that the foregoing is true and correct to the best of my knowledge and belief. Executed on October 16, 2018." Now weeks later, the OCC's Deputy Chief Counsel Charles M. Steele has denied the appeal, claiming it is not clear why the public needs access to these records of Otting's current attacks on CRA before OCC closes its comment period on Otting's new, desperate attempt. The OCC's denial makes light of Otting's actions including soliciting false comments during the public review process of his sale of OneWest Bank to CIT - as if there is no connection to Otting's current gambit. FOIA Denial here and for download on Patreon.

November 5, 2018

  Cadence Bancorporation, who application to acquire State Bank in Georgia Fair Finance Watch challenged, has as its defense that the banks it chose to buy were "problematic." But Cadence chose to buy them. And if it hasn't fixed them yet, why though they get an approval to buy yet another bank? We'll have more on this.

October 29, 2018

As Community Reinvestment Act Is Targeted by Otting Murky Meeting With Citigroup TIAA Wells

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, October 24 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. Now on October 17, yet more on Otting's assault on the CRA has become known. He has taken to devaluing or lumping together and not putting in the docket or online the comments of community groups, calling them mass comments or form letters - when he himself not only solicited mass comments for the OneWest - CIT merger from which he personally profited, but even got some fraudulent comments. Inner City Press / Fair Finance Watch submitted the documents obtained under FOIA into the record before the OCC. Now, on a ten day delay, the OCC has put into the file a cursory memo of its October 12 meeting with bankers ranging from Citigroup (Lloyd Brown and Devika Murray Bacchus), Capital One (James Matthews), TIAA and Regions to Wells Fargo, Fifth Third, Huntington and PNC, among others. This has the trappings of transparency, but none of the substance. Topics of discussion are purportedly listed - but what was said, particularly by the OCC participants: Grovetta Gardineer, Senior Deputy Comptroller
for Compliance and Community Affairs
Beverly Cole, Deputy Comptroller for
Compliance Supervision
Donna Murphy, Deputy Comptroller for
Compliance Risk Policy
Allison Hester-Haddad, Counsel, Chief
Counsel’s Office
Daniel Sufranski, Law Clerk, Chief Counsel’s
Office. Listed but without further detail is, for example, "Logistical issues, including the interrelated nature of the issues raised by the ANPR, the timing of the rulemaking process, participation by the other federal banking agencies, and whether concepts not discussed in the ANPR would remain under a new rule." So what was said? And where is the OCC's response to Inner City Press' previous FOIA request? We will have more on this.

October 22, 2018

As Community Reinvestment Act Is Targeted by Otting He Devalues Comments He Earlier Gamed

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, October 17 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. Now on October 17, yet more on Otting's assault on the CRA has become known. He has taken to devaluing or lumping together and not putting in the docket or online the comments of community groups, calling them mass comments or form letters - when he himself not only solicited mass comments for the OneWest - CIT merger from which he personally profited, but even got some fraudulent comments. Inner City Press / Fair Finance Watch submitted the documents obtained under FOIA into the record before the OCC, stating that "These documents, which must be considered as part of this ANPR and any subsequent formal rulemaking, show that fraudulent comments supporting Otting's OneWest were submitted to the OCC - presumptively attributable to Otting.
The documents show that the OCC sought an explanation from Otting's / OneWest's outside counsel - and the OCC's and Justice Department's response to date reflect that no such explanation was ever provided. The OCC nevertheless approved the merger and even gave weight to the fraudulent comments.  But via the OCC and Regulations.gov websites, we are told "This count refers to the total comment / submissions received on this document, as of 11:59 PM yesterday. Note: Agencies review all submissions, however some agencies may choose to redact, or withhold, certain submissions (or portions thereof) such as those containing private or proprietary information, inappropriate language, or duplicate/near duplicate examples of a mass-mail campaign. This can result in discrepancies between this count and those displayed when conducting searches on the Public Submission document type." At least ten comments, all under the name Ceiba, were bundled as one. Otting is trying to have it both ways, or worse.
Under him, the OCC has ignored the rare racial redlining settlement by Klein Bank, rubber stamping Old National's acquisition of the bank over the timely and detailed objection and public hearing request of Fair Finance Watch. Otting doesn't like public hearings.  In April 2018 his OCC approved an application by E-Trade Saving Bank which Fair Finance Watch had challenged based on the bank having no fewer than six states rare "Needs to Improve" CRA ratings. FFW noted rare Needs to Improve ratings for the entire states of Arizona, Colorado, Florida, Georgia, Michigan and Oregon, and an undeserved “Satisfactory” for New York. Otting's OCC, after the approval, helpfully contacted E-Trade Bank to tell it that upon (Otting's) reflection, it was no longer even subject to the Community Reinvestment Act. Another institution was similarly contacted - the OCC under Otting is going through its roster of banks seeing which ones it can "free" from CRA even if they hadn't requested in. In one case, some in the bank still didn't want Otting's freedom and move more business into the bank to get a second reversal of Otting's orders. But it shows where Otting is coming from, beyond the unexplained comment-fraud for which he should be recused. Inner City Press on October 11 raised the E-Trade (and another bank) issue into the record on the Advanced Notice of Proposed Rulemaking. But, Otting being Otting, his OCC denied expedited processing for Inner City Press' Freedom of Information Act request bout his deregulation move, ruling that "You requested all records in the OCC's possession concerning the applicability of the Community Reinvestment Act to - or exemption there from - any affiliate of E-Trade or Bank of America California NA for the time period of October 11, 2016 to October 11, 2018. You also requested expedited processing of your request on the basis that the ANPR on CRA is open through November 19, 2018. Your request for expedited processing does not meet the criteria provided for in 5 U.S.C. 552(a)(6)(E) and Treasury disclosure regulations at 31 C.F.R. 1.5(e)." And that regulation... requires a formal certification. So Inner City Press has appealed: "As a  a person primarily engaged in disseminating information, I am appealing the denial of expedited processing of my FOIA request, summarized by the OCC as for all records in the OCC's possession concerning the applicability of the Community Reinvestment Act to - or exemption there from - any affiliate of E-Trade or Bank of America California NA for the time period of October 11, 2016 to October 11, 2018.
...The OCC under Joseph Otting's actions to try to find banks to exempt from CRA outrageous and something on which there is an  urgency to inform the public concerning actual or alleged Federal Government activity. As noted in my request, this is particularly the case given the OCC's unilateral moves regarding the CRA. I declare under penalty of perjury that the foregoing is true and correct to the best of my knowledge and belief. Executed on October 16, 2018." Watch this site.

October 15, 2018

As Community Reinvestment Act Is Targeted by Otting Inner City Press Raises His Bid to Free E-Trade From CRA

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, October 11 – The US Treasury Department is in a process to try to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. Now on October 11, more on Otting's assault on the CRA has become known. In April 2018 his OCC approved an application by E-Trade Saving Bank which Fair Finance Watch had challenged based on the bank having no fewer than six states rare "Needs to Improve" CRA ratings. FFW noted rare Needs to Improve ratings for the entire states of Arizona, Colorado, Florida, Georgia, Michigan and Oregon, and an undeserved “Satisfactory” for New York. Otting's OCC, after the approval, helpfully contacted E-Trade Bank to tell it that upon (Otting's) reflection, it was no longer even subject to the Community Reinvestment Act. Another institution was similarly contacted - the OCC under Otting is going through its roster of banks seeing which ones it can "free" from CRA even if they hadn't requested in. In one case, some in the bank still didn't want Otting's freedom and move more business into the bank to get a second reversal of Otting's orders. But it shows where Otting is coming from, beyond the unexplained comment-fraud for which he should be recused. Inner City Press on October 11 raised the E-Trade (and another bank) issue into the record on the Advanced Notice of Proposed Rulemaking. Many more are resisting Otting, but Federal Reserve Bank of Cleveland President Loretta J. Mester on October 3 said that "the OCC, a part of Treasury, has put out an advance notice of proposed rule-making (ANPR) seeking comment on ways to modernize the CRA regulations. The Federal Reserve is also undertaking efforts aimed at ensuring that the CRA regulations continue to meet the goals of the legislation amid the evolving financial services environment" - with these as her footnotes for that: "Brainard, Lael, “Community Development in Baltimore and A Few Observations on Community Reinvestment Act Modernization,” Baltimore, Maryland, April 17, 2018a and Brainard, Lael, “Keeping Community at the Heart of the Community Reinvestment Act,” New York, NY, May 18, 2018b. Both of those Brainard speeches were before Otting's proposals. And since? In the docket file as of October 8 are 42 comments, now including the President of  First National Bank & Trust in Elk City, Oklahoma who writes, "I firmly believe that this form of oversite was meant for metropolitan areas and banks with multiple branches. There’s got to be a better way of monitoring and locating those banks that aren’t helping the population it serves. I would be surprised to find there are very many banks that fail the CRA examination." It's called grade inflation. On September 29 The Intercept has dug into it, citing FFW's formal request that Otting recuse himself - and so here now are some of the Freedom of Information Act documents.

October 8, 2018

As Community Reinvestment Act Is Targeted by Otting He Back Pedals in Senate As Inner City Press Urges Recusal

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, October 2 – The US Treasury Department has begun a process to weaken and take the community out of the 1977 Community Reinvestment Act. Docket file here. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. On September 29 The Intercept has dug into it, citing FFW's formal request that Otting recuse himself - and so here now are some of the Freedom of Information Act documents. On October 2 in the Senate Banking Committee, Otting insisted he is not trying to weaken the CRA; he called the ANPR an "Advanced Notice of Public Rulemaking" instead of Proposed. He said he met with 1100 individuals - still undisclosed - and expects five to ten thousand comments on the ANPR. (So far there are 33 listed but only 29 visible). Senator Sherrod Brown began by asking him indirectly about the blogs at CFPB of Eric Blankenstein. We'll have more on this. And this - as obtained by Inner City Press and fellow NCRC member CRC, here are more of the documents, for (this time) free download on Patreon.

 Now on October 1 Inner City Press / Fair Finance Watch has submitted the documents obtained under FOIA into the record before the OCC, stating that "These documents, which must be considered as part of this ANPR and any subsequent formal rulemaking, show that fraudulent comments supporting Otting's OneWest were submitted to the OCC - presumptively attributable to Otting.
The documents show that the OCC sought an explanation from Otting's / OneWest's outside counsel - and the OCC's and Justice Department's response to date reflect that no such explanation was ever provided. The OCC nevertheless approved the merger and even gave weight to the fraudulent comments. On this record we again insist that Otting be recused from this ANPR and any related rulemaking or proceedings. We have other substantive concerns about this ANPR but view the question of Mr Otting's recusal (and of with whom he has met, on which Inner City Press has another long-pending FOIA request) as threshold matter than must be addressed as quickly as possible."


October 1, 2018

As Community Reinvestment Act Is Targeted by Otting The Intercept Notes Inner City Press Urging Recusal

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX, September 29 – The US Treasury Department has begun a process to weaken and take the community out of the 1977 Community Reinvestment Act. The protagonist, akin to Scott Pruitt when he was at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, here. And now on September 29 The Intercept has dug into it, citing FFW's formal request that Otting recuse himself - and so here now are some of the FOIA documents, obtained by Inner City Press and fellow NCRC member CRC, and pro bono lawyer Lindsey Krause of Nichols Kaster.  Here are more of the documents, for (this time) free download on Patreon.

 One of the issues raised, that of Otting's role in previous fraudulent commenting to the OCC in support of his own bank OneWest's merger with CIT in 2015 has come to the fore. Relatedly, the FOIA document as provided by the OCC and US Department of Justice reflect that the OCC never follow up on its lone (and wan) question to Otting's counsel as Sullivan & Cromwell to explain the fraudulent comments. Nor did this counsel respond to questions from The Intercept's David Dayen, who reports: "AFTER A YEARLONG effort to obtain the information, which included ongoing litigation, the OCC made available 15 pages. They contain emails to and from David Finnegan, an OCC senior licensing analyst who was a point of contact for public comment on the merger.

Four individuals contended in emails to Finnegan that they never sent the comment letters supporting the merger. “This is to bring to your attention that I received an email from the office of OCC regarding a subject I am completely unaware of,” wrote one individual (the OCC redacted the emailers’ identifying information). “I DID NOT send the email below that you responded to. This is a fraudulent use of my email account.” The other three sent similar complaints.

The letter of support attributed to these individuals was identical to the letter posted at the OneWest Bank website.

Matthew Lee of Inner City Press expressed outrage at the fake comments. “There’s nothing more offensive of speech rights than artificially presenting someone as saying something you don’t believe,” Lee said. “You have the right to be silent. It’s so beyond the pale.”

FOIA Finds: OneWest CIT Ban... by on Scribd


Finnegan responded to these emailers, thanking them for letting him know. He also sent two emails to Stephen Salley, an attorney with Sullivan & Cromwell, who was representing OneWest in the merger. “FYI and review. We would appreciate any information you can provide regarding this submission,” Finnegan wrote to Salley on both occasions.

Presumably, Finnegan reached out to OneWest’s lawyer about the fake comments because they featured the same form letter that OneWest had written to encourage public support. But the two emails are the only record that OCC did any investigation of the fake comments. There is no reply from Salley or Sullivan & Cromwell to the OCC, at least not in written form. “By reaching out to the attorneys immediately, it suggests something serious, and yet there’s no follow-up that’s apparent whatsoever,” said Kevin Stein of the California Reinvestment Coalition...Olivia Weiss, a spokesperson for CIT, forwarded a request for comment to her colleague Gina Proia, who declined to comment. Salley did not respond when asked whether he or his law firm responded to the OCC....In his public comment for Inner City Press, Lee asked for Otting to recuse himself from the new rule-making, highlighting the fake comment controversy. “Public participation is key to CRA, on performance evaluations and crucially on bank merger and expansion applications,” Lee wrote. He added that it’s unclear whether the OCC has improved its processes to prevent fake comments from being submitted again in the CRA rule-making. The public comment period ends in November.

Otting is scheduled to appear at a Senate Banking Committee hearing on October 2, where his CRA push could be a topic of discussion." We'll have more on this Why didn't the OCC more seriously look into this fraud? What has been improved since? Shouldn't Otting be recused, as Fair Finance Watch has already timely requested?

September 24, 2018

As Community Reinvestment Act Is Targeted by Otting Net Neutrality Echo FFW Urges Recusal to OCC

By Matthew R. Lee, Video, 7/31 story

SOUTH BRONX, September 17 – The US Treasury Department has begun a process to weaken and take the community out of the 1977 Community Reinvestment Act. The protagonist, akin to Scott Pruitt until recently at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, the 14th comment so far, here. But one of the issues raised, that of Otting's role in previous fraudulent commenting to the OCC in support of his own bank OneWest's merger with CIT in 2015 has come to the fore. Why didn't the OCC more seriously look into this fraud? What has been improved since? Shouldn't Otting be recused, as Fair Finance Watch has already timely requested? One analogy is to the gaming of the FCC's process on net neutrality, when even Senator Jeff Merkley and Pat Toomey's identities were borrowed, as reported by the Washington Post's Hamza Shaban.  Unlike Otting to date, at least the FCC's Ajit Pai responded, if only to blame David Bray, as reported by Adam Jacobson in RBR. Otting simple refuses to answer - for now. From the Fair Finance Watch / Inner City Press comment: "Fair Finance Watch (and where applicable Inner City Press) appreciate the opportunity to comment on the Office of the Comptroller of the Currencys (OCC) Advance Notice of Proposed Rulemaking (ANPR) regarding the Community Reinvestment Act (CRA). CRA has leveraged significant amounts of loans and investments for low- and moderate-income communities.

We began enforcing the CRA in the South Bronx then beyond starting in 1994, in connection with the applications for mergers or expansions on which banks' records are considered. Numerous banks excluded the South Bronx and Upper Manhattan from their CRA assessment areas even though, as we proved, they collected substantial deposits from area residents. We got six banks to open branches and make lending commitments, in the Bronx and beyond.

We concerned that the OCC's proposal threatens to weaken CRA, see below. As as relevant here, we commented along with others on the CIT - OneWest proceeding, and were concerned both by OneWest's record under now-Comptroller Otting and by what emerged as the gaming of the system with pre-fabricated comments Otting openly solicited. We may comment in more detail on this later in his ANPR proceeding.

For now we wish raise particular concern about the approach signaled by Questions 21 and 15 and to emphasize that public participate is key to CRA, on performance evaluations and crucially on bank merger and expansion applications. Inner City Press, which often submits FOIA requests to the OCC (which is, frankly, slow), the Federal Reserve, FDIC and even non-USA regulators many of whom are faster than the OCC, emphasizes that comment periods should never close while information that is not specifically exempt from disclosure under FOIA is being withheld. Inner City Press has pending with the OCC, but not yet responded to, FOIA requests related to this proceeding / process, that should be responded to in full, including any necessary appeal, during this proceeding.

If the OCC proceeds to significantly diminish the importance of assessment areas on CRA exams, the progress in increasing lending to low- and moderate-income neighborhoods will be halted. NCRC estimates that low- and moderate-income neighborhoods could lose up to $105 billion in home and small business lending nationally over a five year time period. We join in the comments of NCRC, of which we are members... We urge the OCC to go back to the drawing board and develop reform proposals with the Federal Reserve Board and the FDIC.

And, for the reasons above and yet to be submitted, we contend Comptroller Otting should be recused from this process. Thank you for your attention to this."

While Reuters blandly noted that he is "a former banker," the bank he headed, OneWest, was accused of predatory lending and when its acquisition by the CIT Group was challenged by Fair Finance Watch, CRC and others Otting arranged for seemingly counterfeit or compelled comments supporting the merger. In this light, Question 11 of his "Advanced Notice of Proposal Rulemaking" or ANPR is noteworthy: "11. How can community involvement be included in an evaluation process that uses a
metric-based framework?" How, indeed. Here's what Otting wrote as a banker, already long public, in support of his merger:

"From: Otting, Joseph M [at] owb.com
Sent: Wednesday, January 07, 2015 5:00 PM
Cc: Haas, Alesia Jeanne; Tran, Cindy; Kim, Glenn
Subject: Support For OneWest Bank
 
Dear Friends,
 
We were excited to announce on July 21, 2014, that IMB HoldCo LLC, the parent company of OneWest Bank entered into a merger agreement with CIT Group Inc. As part of the applications for regulatory approval of the transaction, our regulators are interested in the perspectives of the public. We are writing you to seek your support of the Bank and pending merger. This merger, if approved, would create the largest bank headquartered in Southern California with a full suite of banking products and services, which will allow us to better serve our customers. We would retain and grow jobs and are committed to continuing and expanding our efforts to serve the economic and development needs of our community. I would like to ask you to take a moment to click on the link below and submit a letter of support adding any of your own words or thoughts.
 
Please submit your letter by clicking here, or by visiting our website at www.OneWestBank.com/merger-support (if the link isn't clickable or part of the link is cut off, please copy and paste the entire URL into your browser's address bar and press Enter)
 
Thank you for your support.  Best wishes for a successful 2015 and please call on me if I can ever be of assistance.
 
Joseph M. Otting
President and CEO
OneWest Bank N.A.
888 East Walnut Street
Pasadena, CA 91101"

   There will be fight-back, under NCRC's TreasureCRA campaign. Watch this site - including on actual enforcement of CRA.

September 17, 2018

As Community Reinvestment Act Is Targeted by Otting Fair Finance Watch Urges Recusal to OCC

By Matthew R. Lee, Video, 7/31 story

SOUTH BRONX, September 12 – The US Treasury Department has begun a process to weaken and take the community out of the 1977 Community Reinvestment Act. The protagonist, akin to Scott Pruitt until recently at the US Environmental Protection Agency, is Comptroller of the Current Joseph Otting. On September 12 Fair Finance Watch (and on FOIA, Inner City Press) commented to the OCC, the 14th comment so far, here. From the comment: "Fair Finance Watch (and where applicable Inner City Press) appreciate the opportunity to comment on the Office of the Comptroller of the Currencys (OCC) Advance Notice of Proposed Rulemaking (ANPR) regarding the Community Reinvestment Act (CRA). CRA has leveraged significant amounts of loans and investments for low- and moderate-income communities.

We began enforcing the CRA in the South Bronx then beyond starting in 1994, in connection with the applications for mergers or expansions on which banks' records are considered. Numerous banks excluded the South Bronx and Upper Manhattan from their CRA assessment areas even though, as we proved, they collected substantial deposits from area residents. We got six banks to open branches and make lending commitments, in the Bronx and beyond.

We concerned that the OCC's proposal threatens to weaken CRA, see below. As as relevant here, we commented along with others on the CIT - OneWest proceeding, and were concerned both by OneWest's record under now-Comptroller Otting and by what emerged as the gaming of the system with pre-fabricated comments Otting openly solicited. We may comment in more detail on this later in his ANPR proceeding.

For now we wish raise particular concern about the approach signaled by Questions 21 and 15 and to emphasize that public participate is key to CRA, on performance evaluations and crucially on bank merger and expansion applications. Inner City Press, which often submits FOIA requests to the OCC (which is, frankly, slow), the Federal Reserve, FDIC and even non-USA regulators many of whom are faster than the OCC, emphasizes that comment periods should never close while information that is not specifically exempt from disclosure under FOIA is being withheld. Inner City Press has pending with the OCC, but not yet responded to, FOIA requests related to this proceeding / process, that should be responded to in full, including any necessary appeal, during this proceeding.

If the OCC proceeds to significantly diminish the importance of assessment areas on CRA exams, the progress in increasing lending to low- and moderate-income neighborhoods will be halted. NCRC estimates that low- and moderate-income neighborhoods could lose up to $105 billion in home and small business lending nationally over a five year time period. We join in the comments of NCRC, of which we are members... We urge the OCC to go back to the drawing board and develop reform proposals with the Federal Reserve Board and the FDIC.

And, for the reasons above and yet to be submitted, we contend Comptroller Otting should be recused from this process. Thank you for your attention to this."

While Reuters blandly noted that he is "a former banker," the bank he headed, OneWest, was accused of predatory lending and when its acquisition by the CIT Group was challenged by Fair Finance Watch, CRC and others Otting arranged for seemingly counterfeit or compelled comments supporting the merger. In this light, Question 11 of his "Advanced Notice of Proposal Rulemaking" or ANPR is noteworthy: "11. How can community involvement be included in an evaluation process that uses a
metric-based framework?" How, indeed. Here's what Otting wrote as a banker, already long public, in support of his merger:

"From: Otting, Joseph M [at] owb.com
Sent: Wednesday, January 07, 2015 5:00 PM
Cc: Haas, Alesia Jeanne; Tran, Cindy; Kim, Glenn
Subject: Support For OneWest Bank
 
Dear Friends,
 
We were excited to announce on July 21, 2014, that IMB HoldCo LLC, the parent company of OneWest Bank entered into a merger agreement with CIT Group Inc. As part of the applications for regulatory approval of the transaction, our regulators are interested in the perspectives of the public. We are writing you to seek your support of the Bank and pending merger. This merger, if approved, would create the largest bank headquartered in Southern California with a full suite of banking products and services, which will allow us to better serve our customers. We would retain and grow jobs and are committed to continuing and expanding our efforts to serve the economic and development needs of our community. I would like to ask you to take a moment to click on the link below and submit a letter of support adding any of your own words or thoughts.
 
Please submit your letter by clicking here, or by visiting our website at www.OneWestBank.com/merger-support (if the link isn't clickable or part of the link is cut off, please copy and paste the entire URL into your browser's address bar and press Enter)
 
Thank you for your support.  Best wishes for a successful 2015 and please call on me if I can ever be of assistance.
 
Joseph M. Otting
President and CEO
OneWest Bank N.A.
888 East Walnut Street
Pasadena, CA 91101"

   There will be fight-back, under NCRC's TreasureCRA campaign. Watch this site - including on actual enforcement of CRA. A bank that was sued by the US Justice Department in 2017 for redlining and discrimination is trying to sell itself to Old National, and Fair Finance Watch has formally challenged it under the Community Reinvestment Act in a filing to the Federal Reserve on the last day of the comment period.

September 10, 2018

Mulvaney's Moves Against Disparate Impact At CFPB Opposed As CRA Targeted by Otting at OCC

By Matthew R. Lee, Video, 7/31 story

SOUTH BRONX, September 6 – With the Consumer Financial Protection Bureau under Mick Mulvaney moving to undermine liability for disparate impact discrimination, state Attorneys General from New York and 13 other states have delivered a letter of opposition, on September 5. NY AG Barbara Underwood said, "the Equal Credit Opportunity Act was enacted because of our country’s sordid history of credit discrimination — and it’s unbelievable that the CFPB is considering refusing to use it to protect consumers." The letter  signed by the attorneys general of North Carolina, California, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont, Virginia and the District of Columbia stated that they "will not hesitate to uphold the law if CFPB acts in a manner contrary to law with respect to interpreting ECOA." We'll have more on that - and this: the US Office of the Comptroller of the Currency Joseph Otting on August 28 began a process to weaken and take the community out of the 1977 Community Reinvestment Act. Now in September he has given conditional approval to a fintech bank, Varo Bank of Varo Money, which will include only Salt Lake City, Utah in its CRA assessment area. The CEO is Colin Walsh, previously of scandal plagued Wells Fargo. But will the FDIC, which has not for now joined Otting's crusade, hand out deposit insurance?

September 3, 2018

As Community Reinvestment Act Is Targeted by Otting His OCC's Notice to Community Is Silent As Banks Cheer

By Matthew R. Lee, Video, 7/31 story

SOUTH BRONX, August 29 – The US Office of the Comptroller of the Currency Joseph Otting on August 28 began a process to weaken and take the community out of the 1977 Community Reinvestment Act. But on August 29 when the OCC purported to solicit public comments for the CRA evaluation of banks in the fourth quarter of 2018 and even first quarter of 2019, the OCC's notice did not even mention or link to Otting's proposal to change the CRA. Here is what the OCC e-mailed out on August 29. So the community is not informed - but the industy is. Even open sources are full of banks and their lobbying groups celebrating and preparing to support Otting's proposal(s). From Louisiana, there is this: "GAME FACE ConsumerBankers GC Steve Zeisel is ready for today’s Membership Call regarding the @USOCC ANPR on #cra. #intense. #focus." On the other hands, there's this, on and of which we'll have more. The protagonist, akin to Scott Pruitt until recently at the US Environmental Protection Agency, is Joe Otting. While Reuters blandly noted that he is "a former banker," the bank he headed, OneWest, was accused of predatory lending and when its acquisition by the CIT Group was challenged by Fair Finance Watch, CRC and others Otting arranged for seemingly counterfeit or compelled comments supporting the merger. In this light, Question 11 of his "Advanced Notice of Proposal Rulemaking" or ANPR is noteworthy: "11. How can community involvement be included in an evaluation process that uses a
metric-based framework?" How, indeed. Here's what Otting wrote as a banker, already long public, in support of his merger:

"From: Otting, Joseph M [at] owb.com
Sent: Wednesday, January 07, 2015 5:00 PM
Cc: Haas, Alesia Jeanne; Tran, Cindy; Kim, Glenn
Subject: Support For OneWest Bank
 
Dear Friends,
 
We were excited to announce on July 21, 2014, that IMB HoldCo LLC, the parent company of OneWest Bank entered into a merger agreement with CIT Group Inc. As part of the applications for regulatory approval of the transaction, our regulators are interested in the perspectives of the public. We are writing you to seek your support of the Bank and pending merger. This merger, if approved, would create the largest bank headquartered in Southern California with a full suite of banking products and services, which will allow us to better serve our customers. We would retain and grow jobs and are committed to continuing and expanding our efforts to serve the economic and development needs of our community. I would like to ask you to take a moment to click on the link below and submit a letter of support adding any of your own words or thoughts.
 
Please submit your letter by clicking here, or by visiting our website at www.OneWestBank.com/merger-support (if the link isn't clickable or part of the link is cut off, please copy and paste the entire URL into your browser's address bar and press Enter)
 
Thank you for your support.  Best wishes for a successful 2015 and please call on me if I can ever be of assistance.
 
Joseph M. Otting
President and CEO
OneWest Bank N.A.
888 East Walnut Street
Pasadena, CA 91101"

   There will be fight-back, under NCRC's TreasureCRA campaign. Watch this site

August 27, 2018

Redlining Klein Bank Wants to Sell Out to Old National But Fair Finance Watch Challenges to Fed

By Matthew R. Lee, Video, 7/31 story

NEW YORK, August 24 – A bank that was sued by the US Justice Department in 2017 for redlining and discrimination is trying to sell itself to Old National, and Fair Finance Watch has formally challenged it under the Community Reinvestment Act in a filing to the Federal Reserve on the last day of the comment period. From the filing: "This is a timely first comment opposing the Applications of Old National Bancorp to merge with Klein Financial, Inc., Chaska, Minnesota, and thereby indirectly acquire KleinBank, also of Chaska, Minnesota.

As an initial matter, this is a request that the FRS immediately send by email to Inner City Press all non-exempt portions of the applications / notices for which the Applicants have requested confidential treatment.

  It was only last year that “the U.S. Justice Department accused Chaska-based KleinBank of redlining, the illegal practice of denying mortgage loans to minority residents. Lawyers from the department's civil rights division said KleinBank engaged in discrimination in Minneapolis and St. Paul by failing to market its services and open bank branches in areas dominated by minorities. KleinBank, which operates 21 branches in mostly outer-ring suburbs of the Twin Cities, is one of Minnesota's largest community banks. 'KleinBank's discriminatory practices … have been intentional and willful, and implemented with reckless disregard for the rights of individuals on the basis of their race and/or national origin,' the complaint said.”

   Now, attempting to cash in / out of that discrimination, Klein Bank seeks to sell, to Old National which has its own insufficient records. Fair Finance Watch has been tracking Old National:
In 2012 in its Evansville (Headquarters) MSA for conventional home purchase loans back in 2012, Old National Bank made only six such loans to African Americans. In 2016, the most recent year for which data is available, Old National made only THREE such loans to African Americans.  In Table 4-1, in 2012 it made three such loans to African Americans. In 2016 this fell to one.
Old National has gotten worse. It cannot be allowed to acquire Klein so recently prosecuted for discrimination.
 (Separately, note that in Evansville MSA in 2016, Old National reported a 100% approved and originated rate for both African Americans and Latinos, until in other MSAs - this is not credible, presumptively indicates pre-screening and should be investigated in connection with this Klein proposal.)
   For refinance loans in Evansville in 2012, Old National made eight such loans to African Americans. This fell to four in 2016.
   For home improvement loans in the Evansville MSA, Old National in 2012 made five such loans to African Americans. This fell to four in 2016.
   For refinance loans in Indianapolis in 2012, Old National made 18 such loans to African Americans. This fell to a mere seven in 2016, when Old National denied 62% of applications from African Americans (see above). 
Old National has gotten much worse. It cannot be allowed to acquire Klein so recently prosecuted for discrimination.
  Also troubling regarding Old National is its history of branch closings. According to its hometown newspaper the Evansville Courier News & Press
 "since 2004 Old National has purchased 175 banking offices, either through acquiring smaller financial institutions or buying selected office locations. Old National has also shed 140 banking offices by consolidating 121 locations and by selling 19 other offices."
 Old National is a bank with a disparate lending record that specializes in buying and closing bank branches - now it seeks to acquire Klein Bank prosecuted only last year for redlining.
  ICP is requesting evidentiary hearings and that this proposed acquisition, on the current record, not be approved. There is no public benefit." We'll have more on this

August 20, 2018

The American Bankers Association loves Otting, this is their write up, on which we will have more, much more: "The OCC yesterday updated its policies and procedures manual to clarify its policy and methodology for determining how evidence of discrimination or illegal credit practices will affect a bank’s Community Reinvestment Act rating. The updated version replaces a previous edition of the manual issued in October 2017.

Importantly, the updated manual maintains the OCC’s position that there be a logical nexus between the CRA rating and evidence of discriminatory or illegal credit practices. The revisions clarify that in assigning a CRA rating, the OCC first evaluates a bank’s CRA performance for the applicable time period and then makes any adjustments that are warranted based on evidence of discriminatory or other illegal credit practices. The OCC also clarified that its general policy is to downgrade the rating by only one rating level unless such illegal practices are found to be particularly egregious.

The OCC reiterated that its policy is “generally not to penalize a bank by lowering its CRA rating when examiners have determined the bank has taken appropriate remedial actions." Outrageous.