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August 3, 2015

Fed Rejects Community Bank System - Oneida Withholding 8 of 9 Responses - but Gov Powell Rubber-Stamps on FOIA Appeals

By Matthew R. Lee

NEW YORK, August 1 -- The lack of seriousness in US bank regulation extends from large to smaller banks. As Inner City Press exposed last month, Royal Bank of Canada jumped the gun and began doing business with City National Bank without any Federal Reserve approval (see Los Angeles Times, here.)

  Community Bank System of upstate New York filed with the Fed nine answers to questions asked after Inner City Press' challenge -- and tried to withhold fully eight of the nine responses. More here.

  Inner City Press immediately filed a Freedom of Information Act request for the whole submission - and even the Federal Reserve has seen through Community Bank System's absurdly -- and tellingly -- overbroad withholding, releasing all but one part of one of the eight withheld responses.

  Here's is the Federal Reserve's letter to Inner City Press granting most of its FOIA request:here is the now unredacted version of Community Bank System's submission.

  Meanwhile, Fed governor Jay Powell continues rubber-stamping on FOIA appeals - on this, we'll have more.

July 27, 2015

To Federal Reserve Board, Community Bank System - Oneida Withhold 8 of 9 Responses - ICP Challenges Under FOIA

By Matthew R. Lee

NEW YORK, July 25 -- The lack of seriousness in US bank regulation extends from large to smaller banks. Last week the Federal Reserve hauled off and approved CIT - One West, with whose executives the Fed met before the deal was even announced a year ago.

  Further down the food chain, Community Bank System of upstate New York filed with the Fed nine answers to questions asked after Inner City Press' challenge -- and is trying to withhold fully eight of the nine responses. More here.

  Inner City Press is challenging this under the Freedom of Information Act, comparing Community Bank System's outrageous withholding at the Fed with other banks, and with Community Bank System's to the OCC, more here.

July 20, 2015

RBC - City National Gun Jumping Covered by LAT, After FFW Raised It, CBSI Contrasted

By Matthew R. Lee

NEW YORK, July 18 -- The largest bank merger recently proposed, that of Royal Bank of Canada and affluent-focused Los Angeles-based City National Bank, has since April been the subject of a Community Reinvestment Act challenge by Fair Finance Watch.

  Now the LA Times has reported on the "letter from the Fed [which] asks the banks to respond to questions raised in written comments by [FFW]. Spokesmen for the banks declined to comment.... Fair Finance Watch, a New York advocacy group for minorities, questioned a deal between the banks in a June 11 comment letter to the Fed."

  Inner City Press first put that Fed letter online, here; then Canada's National / Financial Post reported without credit it had "obtained" it.

  By contrast, in another pending proposal, CBSI - Oneida, the Syracuse Post-Standard disclosed that "Inner City Press forwarded the letter to news outlets. Some of the Fed's questions focus on whether Community could improperly control matters at Oneida in advance of the acquisition. Community is working on Fed's questions, said Hal Wentworth, Community's senior vice president for retail banking."

  One common theme is that non-control (and therefore antitrust) laws are being violated. One difference is that CBSI does comment to the media -- if only to blame the messenger -- while larger RBC and CNB do not. Arrogance?

 On CBSI's blaming the messenger, FFW has commented to the Fed that it will "will comment again when CBSI has provided a copy of its response to the FRS' questions of July 13. Beyond the CRA and impermissible “control” questions raised therein, we wish at this time to raise the issues that, in a public response to ICP's comments, CBSI's SVP for retail banking said the following, in a prepared statement no less:

'In a statement today, Hal Wentworth, Community's senior vice president for retail banking, said that Inner City Press is not a local group and pointed out that letter was the only one filed on the Oneida deal. "This activist does not do business with either Oneida or Community Bank."'

If it would be inappropriate for CBSI to comment on or disclose information about its customers, in this context the same applies to the above-quoted, which, separately, is reminiscent of human rights abusing countries emphasizing where the rights groups who study and report on them are based."

July 13, 2015

  When the Fed acted on BB&T  - Susquehanna with FOIA issues not satisfactorily resolved, it said "in the first quarter of 2015, the FDIC also approved a proposal by Branch Bank to acquire 41 branches of Citibank, National Association, in Texas. In connection with that proposal, the FDIC directed Branch Bank to develop a CRA strategic plan." We'll have more on this.

July 6, 2015

RBC - City National Gun Jumping Questioned by Fed, After FFW Raised It

By Matthew R. Lee

NEW YORK, July 3 -- The largest bank merger recently proposed, that of Royal Bank of Canada and affluent-focused City National Bank, has since April been the subject of a Community Reinvestment Act challenge by Fair Finance Watch.

  Now Royal Bank of Canada has been asked more questions by the Federal Reserve. Inner City Press has uploaded the letter, here.

  On June 6, FFW submitted into the record before the Fed:

"RBC, City National off to friendly start ahead of $5.4B takeover Globe and Mail, May 26, 2015, quoted from below.

  Now the Federal Reserve has asked RBC:

"A commenter alleged that in May 2015 RBC and CNB collaborated to extend credit to a customer of CNB.  Please address this claim. In your response, discuss in detail in detail whether RBC exercises a controlling influence over the management or policies of CNC or CNB without prior approval of the Board. In addition, discuss whether, since entering into the proposed transaction, RBC and CNB have collaborated, or plan to collaborate, on extending credit to any other borrower, and describe the nature and circumstances of those collaborations."

  There are other problems, including RBC's non-compete agreement with PNC Financial Services. But this gun-jumping should be fatal to the proposed merger.

June 29, 2015

 So rather than trying to explain to the Federal Reserve why it violated the law and began to collaborate with City National it hasn't been approved to acquire, Royal Bank of Canada on June 24 told the Fed it had managed to get another comment withdrawn. Well, not that of Inner City Press / Fair Finance Watch. Lawless....

June 22, 2015

Talk about phoning it in. The Fed on June 15 wrote or ruled, on an application where Inner City Press / Fair Finance Watch was the commenter:

The Board received two comments from a single commenter who objected to the proposal principally on the basis of Sterling Bank’s record of extending home mortgage credit to minority individuals in the New York-Wayne-White Plains, New York-New Jersey Metropolitan Division (“New York City MSA”) and the NassauSuffolk Metropolitan Division (“Nassau-Suffolk MD”), as reflected in data reported under the Home Mortgage Disclosure Act (“HMDA”)17 for 2013. The commenter expressed concerns that, based on 2013 HMDA data, Sterling Bank was not meeting th credit needs of minority individuals in the communities served by the bank.18 The commenter also contended that Sterling Bank’s HMDA data are “irregular.” The commenter noted that the bank reported three withdrawn and three incomplete applications for refinance loans to African Americans in the New York City MSA and no denials, suggesting that the bank is prescreening minority borrowers.

Fn 18: Sterling represented that Hudson Valley Bank is primarily a commercial lender and does not have a material mortgage program. Mortgage loans represented approximately 14 percent of the bank’s overall lending portfolio as of December 31, 2014.”

FN 19: Sterling asserted that three loan applications were withdrawn at the prospective borrowers’ request because they did not wish to continue the transaction and that the three other applications were deemed incomplete because the prospective borrowers did not provide the requested property, asset, or income documentation needed by the bank to make a lending decision.”

So the Fed accepts 14% as “not material”? And that all people of color “requested” to withdraw their applications is acceptable? This vague commitment does not make up for it:

Sterling Bank has determined to increase its marketing and outreach efforts to better serve the needs of its communities and has adopted its revised CRA Plan. Although the bank intends to remain primarily a commercial lender, it expects to increase its outreach efforts for residential mortgages. Sterling Bank also stated that it will continue pursuing the other community development and CRA-related initiatives set forth in its revised CRA Plan. Sterling plans to reassess the goals and objectives in its CRA Plan to determine if any adjustments are necessary to reflect the acquisition of Hudson Valley.”

We'll have more on this. And this - on another application ICP has commented on, this was reported:

In a statement today, Hal Wentworth, Community's senior vice president for retail banking, said that Inner City Press is not a local group and pointed out that letter was the only one filed on the Oneida deal. 'This activist does not do business with either Oneida or Community Bank, but nonetheless made vague allegations regarding Community,' Wentworth said. 'These allegations were entirely without merit and will be fully addressed by Community Bank and Oneida Savings in the application process.'”

If it would be illegal for CBSI to so disclose information, for its own purposes, about those who have accounts with it, how is this not illegal too? And from a human rights perspective, what a pathetic and telling response. We'll have more on this.

June 15, 2015

With all due respect, are there any applicable Federal Reserve revolving door rules? "Wolters Kluwer Financial Services recently announced that former federal regulator Sandra Braunstein will provide compliance management and Community Reinvestment Act consulting services to the company’s U.S. banking clients. 'The deep insight and experience that Sandy brings not only to Wolters Kluwer Financial Services’ consulting practice and clients but to our executive leadership team is truly unique and extraordinary,' said Timothy Burniston, EVP of Wolters Kluwer Financial Services' Consulting Practice in the US"...

June 8, 2015

RBC - City National Comment Period Extended, Banks Jumped the Gun

By Matthew R. Lee

NEW YORK, June 6 -- The largest bank merger recently proposed, that of Royal Bank of Canada and affluent-focused City National Bank, has since April been the subject of a Community Reinvestment Act challenge by Fair Finance Watch.

  Now the Federal Reserve Board has granted FFW an extension of the comment period on the proposed merger, through June 11, FRB letter here, due to RBC improperly withholding information which was subsequently released after a Freedom of Information Act (FOIA) request by Inner City Press.

   FFW will comment by June 11 - but has submitted to the Fed an objection dated June 6 noting the two banks admitted they are already working together on transactions, without any authorization.

   FFW on June 6 submitted into the record before the Fed:

"RBC, City National off to friendly start ahead of $5.4B takeover Globe and Mail, May 26, 2015

June 1, 2015

Here's a scam: Royal Bank of Canada and City National wrongfully withheld basic information like their list of subsidiaries during the comment period, now after Inner City Press' FOIA request they release some of the information -- but with the Fed having closed the comment period. This is a scam.

May 25, 2015

Now belatedly the Fed replies on FOIA on CIT - and DOJ comes through, much later, FDIC on BB&T.

May 18, 2015

  The Federal Reserve Board has hit a new low on Freedom of Information Act compliance. On May 15, its Governor Jerome Powell, put in charge of FOIA appeals after joining the Fed from Deutsche Bank and the Carlyle Ground, rubber stamped by rote all of the Fed's FOIA withholdings, for example on CIT - OneWest. Previous Governor in that post have most often overturned parts of the underlying denial, but Powell upholds each and every withholding -- like a FISA court, some say, or a court in Egypt. Inner City Press predicted this back in 2011-2012, and noted it on Capital One. But it has gotten worse.

  When New York Fed president William Dudley read a prepared speech to the Bronx Bankers earlier this month, he had a lot of canned advice on how to help the borough. He didn't say what he would do to actually enforce the Community Reinvestment Act and resist regulatory capture by Citi, Chase and Goldman Sachs...

May 11, 2015

Fed Withholds OneWest Branch Closing, CIT Internet Deposit Info, ICP Appeals

By Matthew Russell Lee

NEW YORK, May 9 -- Federal bank regulators remain captured by large and becoming-large banks like the CIT Group, a Freedom of Information Act response to Inner City Press from the Federal Reserve this week shows.

  Like the Fed's previous FOIA response, exclusively published here, that showed its officials met CIT and OneWest before their proposed merger was announced, this time the Fed is withholding information on services and branches to be shuttered by OneWest.

  These include a low income branch at 390 W. Valley Parkway, Escondido, CA 92025 and another at 2245-B Ventura Blvd, Camarillo, CA 93010.

  For another branch to be shuttered, the address is entirely redacted, blacked out. Inner City Press has submitted an appeal under FOIA, also for information withheld about CIT Bank's Internet Deposit Data by County. How can the Community Reinvestment Act be enforced in this way? Even the names of the counties have been withheld.

  Now that the US House Oversight Committee, though spokesperson Melissa Subbotin Sillin, is asking for FOIA horror stories, the Federal Reserve and the other bank regulators -- and the US State Department, on delay -- should and will be looked at.

May 4, 2015

On the application of Royal Bank of Canada and City National Bank, the Federal Reserve has hit a new low - Inner City Press' request under FOIA of April 11, it waited to acknowledge until the stated end of the comment period. More than a week later, still none of the requested documents have been provided. We'll have more on this.
April 27, 2015

 In a new low, the Federal Reserve waited until the absolute deadline of the RBC - City National Bank comment period... to extend its time to even respond to Inner City Press' FOIA request about the application. UNacceptable.

April 20, 2015

On April 17 the Federal Reserve has asked Sterling questions about inconsistencies in its previous responses, and about Green Campus Partners. We'll have more on this.

April 13, 2015

Not only has the Federal Reserve not told its bank holding companies not to speciously request confidential treatment for their CRA plans - when the request is made, the Fed sends copies of merger applications without the CRA plan, thereby granting the specious request. We'll have more on this.

April 6, 2015

You'd think the Federal Reserve would automatically revive CRA comments that were filed on an application that got withdrawn, if that application is re-submitted. But you'd be wrong. The Fed wrote to Inner City Press / Fair Finance Watch last week:

You have requested that the comments that you filed previously on these cases that were withdrawn be incorporated into these proposals. Because of your specific request in this case, you earlier comments will be incorporated. Staff asks, however, that you resend a copy of those earlier comments to us so we can ensure that staff has all the relevant comments so they can be reviewed as part of the new applications.”

So we send this reply:

Inner City Press / Fair Finance Watch continues to believe that the Federal Reserve System should have some policy on reviving timely submitted, substantive CRA comments if an application is withdrawn then resubmitted in say, one or two years: some period of time.”

The answer? “Thanks you.” We'll have more on this.

March 30, 2015

The Federal Reserve says it is doing a better job ensuring that the public and the public interest are represented on the boards of directors of its Reserve Banks. But consider the “Class C” - public interest -- directors of the Federal Reserve Bank of Cleveland: representatives of U.S. Steel, Smuckers and Sherwin - Williams. Corporations are the public interest? We'll have more on this.

March 23, 2015

Should the Fed be more transparent? It should. Will this be raised? It will. Watch this site.

March 16, 2015

The Federal Reserve has asked Sterling Bank, who attempt to buy Hudson Valley has been protested by Inner City Press / Fair Finance Watch, these questions:

Answer in more detail the following portions of question 9 of the February 4 information request relating to the proposed merger and integration of Hudson Valley's subsidiary bank, Hudson Valley Bank, N.A., Yonkers, New York ("HVB") into Sterling' s subsidiary bank, Sterling National Bank, Montebello, New York ("SNB"), and the potential impact on the target bank' s products, services, lending, branching and CRA program:

Indicate any changes contemplated in HVB's home mortgage, small business, consumer (other than home mortgage), and community development lending; retail banking products; community development
investments and services; or branching. Also indicate any contemplated changes in CRA program administration, staffing, resources, policies, procedures, and training. Indicate how the applicant will provide effective oversight of the CRA program and the relevant experience of the individual(s) to be charged with such oversight.

... Provide an explanation for the decrease in SNB's number and dollar amount of community development lending from 3 1 to 23 and from about $83 million to $77 million.

Watch this site - there's more.

March 9, 2015

While in the WSJ's piece on the Fed in Washington reigning in the New York Fed Governor Tarullo comes out looking good, we note former Comptroller Eugene Ludwig, complaining about how complicated it is - or bragging, and telling banks, come hire me, I can navigate this for you...

March 2, 2015

Beyond Inner City Press / Fair Finance Watch testimony read into the record in Los Angeles by CRC on February 26, here is its second FOIA appeal on this:

On behalf of Inner City Press / Fair Finance Watch (ICP), this is a timely appeal under the Freedom of Information Act of the Federal Reserve Board's (the “FRB's”) February 23, 2015 Denials of ICP's October 18, 2014 FOIA Request regarding the Application of CIT' Group to acquire OneWest and for the Federal Reserve's communications with or about the companies.

After MORE THAN FOUR MONTHS, the Fed e-mailed Inner City Press a heavily redacted file of documents and denial letter which described referrals to other agencies and the right to appeal. This is a timely appeal.

The Fed waited until three days before what is for now its one and only public hearing on this proposal to release, heavily redacted, records requested more than four months ago. Inner City Press is hereby appealing the redactions.

Simply as one example, the Fed redacts after this sentence: “Clawback provisions exist for the First Fed and La Jolla portfolios [REDACTION.” This information should be released, along with other withheld information in the pages after, about the Consent Orders, liquidity risk and Risk Appetite, Resolution Plan, Prepaid cards (“Confidential” question 2, and 3 - and response to Question 10, 11, 1, etc), Integration Governance -- and the redacted portion of “Confidential” Question 2, and all of “Confidential” question 3...

February 23, 2015

   The Federal Reserve, which meets with insiders then withholds the records for seven months even after a FOIA request, here, last week bragged for approving four mergers...
February 16, 2015

On First Horizon's application to acquire TrustAtlantic Financial Corporation of Raleigh NC, the Fed has asked a series of questions on CRA and fair lending, and there may be new public notice - watch this site.

M&T, with its long pending application to acquire Hudson City protested by Fair Finance Watch, NCRC and others, has a mandatory pre-trial conference in the fair lending case against it scheduled for April 7. Will the Federal Reserve take note? Inner City Press submitted the complaint in the case to the Fed...

February 9, 2015

From a (much) belated Fed FOIA response:

In one Fed market, Martinsburg, WV, the parties are proposing a divestiture to bring the market to safe harbor levels. In the Cumberland, MD-WV-PA market, the parties believe that certain factors in the market mitigate the need for a divestiture, as discussed below in detail.”

This, of course, is only given out AFTER the Fed closes the public comment period. We'll have more on this.

February 2, 2015

Here is a problem with the Federal Reserve - they call whatever portion of an application an applicant tries to withhold under FOIA the “confidential portion” - presuming thereby that applicants don't make requests to withhold which don't comply with FOIA, essentially privatizing FOIA. This is the case on a current application, and we oppose it. Watch this site.

January 26, 2015

Last week we asked if the Federal Reserve would allow a comment period to expire when it had not responded to FOIA request, after the applicant bank through its outside counsel wouldn't provide the application - now, we'll find out...

January 19, 2015

  So this month we have an experiment. Actually it started last month, with a request to a Reserve Bank for an application. It hadn't yet been filed - but when it was, no follow up was given. Despite a request to the applicant's counsel, the applicant did not come in that way either. Finally a request to the Board, which gave portions but with key parts withheld, improperly, at the request of the applicant. Does the Fed just let a comment period expire on this basis? Watch this site.
January 12, 2015

For Fed, Obama Taps Landon, Evader of HMDA, Impropriety at FHLB

By Matthew Russell Lee

SOUTH BRONX, January 6  -- The US Federal Reserve, already accused of being too close to industry and playing hide the ball on CIT - OneWest and other proposed mergers, will receive under President Barack Obama another banker, Allan Landon -- one forced to resign from the Federal Home Loan Bank of Seattle after the "appearance of impropriety." Predatory bender continues?

  Landon headed Bank of Hawaii which as Inner City Press previously reported - and re-upped earlier today - was one of the few bank to try to evade the Home Mortgage Disclosure Act by providing it data not electronically in a form it could be analyzed, but only in paper form.

  The Federal Reserve told Fair Finance Watch such evasion was permitted due to the regulation's lack of specificity. Now today Bank of Hawaii's Landon is nominated to join this Federal Reserve Board. Fox guarding the hen house?

  Here is the SEC settlement concerning Landon and the FHLB fo Seattle - which is being allowed, without public input, to merge with the FLHB of Des Moines.

January 5, 2015

What does the Federal Reserve System do, when it through a Reserve Bank is asked about a merger proposal and whether or not an application has been filed yet? Nothing, apparently – no notice, no copy, nothing. We'll have more on this.

December 29, 2014

As CIT Says Wait For Its CRA Plan, Federal Reserve's New Precedent? 

By Matthew Russell Lee

UNITED NATIONS, December 23 -- The US government's ongoing corporate bailout following the 2008 meltdown triggered by predatory lending continues to reverberate in one of the largest proposed mergers of 2014.

  On December 22, pressing for approval of its application to acquire OneWest, CIT told the Federal Reserve, "CITB and OWB are not yet able to provide specific details about the expanded Community Reinvestment Act portfolio because this will be based, in part, on input from CITBNA’s to-be-formed Community Development Advisory Board following the closing of the Transaction."

  That's basically saying, approve our merger (on which the Fed is required to consider CRA), and THEN we'll tell you about CRA.

  The Fed had asked CIT to "provide the final version of the document 'CIT Bank N.A. Community Reinvestment Act Plan,' the draft of which was included as Annex C to the letter responding to the public comments submitted to the Federal Reserve Bank of New York."

  One question is, will the Federal Reserve Board in this case and in others coming up, and fast, require the actual submission for CRA plans and allow for public comment on them?

December 22, 2014

Something is strange at the Federal Reserve. Its public notices for pending merges includes those on which the comment period has closed. But in the December 19 version, a particular pending application has simply disappeared. It was previously disclosed this way:

BB&T Corporation, Winston-Salem, North Carolina to merge with The Bank of Kentucky Financial Corporation, and thereby indirectly acquire The Bank of Kentucky, Incorporated, both in Crestview Hills, Kentucky 3 Richmond 11/10/2014

And now it is gone. It has not been approved; it has simply disappeared, with the effect that those interested in commenting, even after the formal expiration of the period, won't. BB&T's applications to the Federal Reserve, as Fair Finance Watch has noted and complained, are by a former supervisor of the Fed's Legal Division. So now what will be done?

December 15, 2014

  On Midland - Heartland, on which ICP commented, the Federal Reserve last week said "In addition, in response to the public comments on the proposal, the Reserve Bank conducted a fair lending examination during the pendency of this application, including a redlining review across Midland Bank’s assessment areas."  Redlining review? We'll have more on this.

December 8, 2014

As CIT Tells Fed OneWest Will Apply to GSEs

By Matthew Russell Lee

UNITED NATIONS, December 5 -- Four days before a rare Senate hearing on the regulatory capture of the Federal Reserve, on November 17 the Federal Reserve Bank of New York posed a series of questions to CIT Group, trying to buy OneWest.

  Today, CIT provided Inner City Press with a copy of its answer to the Fed's November 17 questions (answers to the Fed's November 25 questions have not yet been provided.)

  CIT says "OneWest has discussed the Transaction with staff of each of FannieMae and FreddieMac (the 'GSEs') and will be filing an application in connection with the change of control of OWB in order for OWB to continue as a seller/servicer for the respective GSE. OneWest is now in the process of preparing the appropriate applications, which it expects to submit as soon as possible, and no later than year-end."

  But will OneWest provide notice of these applications to the GSEs to the groups which have timely protested its applications to the Fed and OCC? The OCC heard much about OneWest, and CIT, at a December 2 EGRPRA hearing in Los Angeles. Why not just hold public hearings on this proposed mega-merger? And on another one, announced but not yet applied for?

December 1, 2014

Fed Asks CIT of Repos & Risk, Dudley's Spin

By Matthew Russell Lee

UNITED NATIONS, November 25 -- At the end of a week that began with a rare Senate hearing on the regulatory capture of the Federal Reserve on November 21, the Federal Reserve posed a few more questions to CIT Group, trying to buy OneWest:

Based on staff’s review of the applications, the following information is requested. Please provide a complete, detailed response to each of the following questions. Provide
supporting documentation as appropriate.

1. From the following activities, identify those in which either CIT Group, Inc. or its subsidiaries (“CIT”) or IMB Holdco LLC or its subsidiaries (“IMB”) is involved. To the extent not already provided in the applications, describe the nature of the activities and provide dollar volumes for CIT and IMB, and include any available information relating to the national market share of CIT and IMB, along with a brief description of other firms that engage in the same activity in the United States. You may confine your responses to information that is maintained in the regular course of business.

a. Holding assets under custody;
b. Provision of short-term funding through bilateral repurchase
agreements;
c. Provision of short-term funding in the tri-party repo market;
d. Provision of prime brokerage services;
e. Provision of short-term lines of credit to financial firms;
f. Securities lending;
g. Lending in the Fed funds market;

h. Provision of bond and equity underwriting services in any of the following markets:
i. Commercial paper;
ii. Asset-backed commercial paper;
iii. Corporate bonds;
iv. High-yield bonds;
v. Municipal bonds;
vi. U.S. Agency debt;
vii. U.S. Agency mortgage backed securities;
viii. Private label asset backed securities;
ix. Seasoned offerings; or
x. Initial public offerings;
i. Tri-party repo dealing;
j. Clearing and settlement;
k. Provision of business credit in any of the following markets:
i. Commercial and industrial lending;
ii. Commercial real estate lending;
iii. Construction loans;
iv. Middle market lending;
v. Small business lending;
vi. Receivables factoring;
vii. Equipment financing/leasing; or
viii. Syndicated lending;

l. Direct dollar lending to foreign institutions and dollar lending
through foreign exchange swaps;
m. Trade letters of credit;
n. Interest rate and credit derivatives trading;
o. Commodities trading;
p. Credit card lending;
q. Mortgage servicing;
r. Corporate trust;
s. Correspondent banking; and
t. Reinsurance.

2. Describe any financial markets (trading-type activities) in which either CIT or IMB is a “market-maker.”

3. Report the current market value, gross and net of collateral, and other risk mitigants for the three largest OTC derivatives counterparties of each of CIT and IMB as measured by the following metrics:

a. by positive current market value (after netting arrangements); and

b. by negative current market value (after netting arrangements).

  We'll see.

November 24, 2014

As Fed's Dudley Spins Regulatory Capture, Of CIT, BB&T, Susquehanna Next

By Matthew Russell Lee

UNITED NATIONS, November 21 -- In a rare Senate hearing on the regulatory capture of the Federal Reserve on November 21, Federal Reserve Bank of New York President Dudley described anti revolving door safeguards and a desire for "good culture" at banks.

  Good culture? How then did the predatory lending meltdown take place? And anti-revolving door? How can it be, then, that a former Federal Reserve Legal Division supervisor is writing for BB&T's deals to those who used to work under her?

  As soon as Dudley left the stand, a more serious anti revolving door protection was proposed.

  Dudley was asked about Goldman Sachs' warehouses, and JPM Chase's abuse of the energy markets, but didn't directly answer.

  The Fed on November 17 itself asked from answers to four questions it sent to the CIT Group, with a copy to Inner City Press.

  Inner City Press and others have challenged CIT's application to acquire OneWest; as set forth below, Inner City Press / Fair Finance Watch has been challenging BB&T even before its November 12 proposal to acquire Susquehanna Bank for $2.5 billion.  What questions will the Federal Reserve have on that one?

  As to CIT - OneWest, the Fed on November 17 has asked:

Based on staff’s review of the applications, the following information is requested. Please provide a complete, detailed response to each of the following questions. Provide supporting documentation as appropriate.

1. Provide a pro forma shareholders list that identifies any shareholder or group of shareholders that would own or control, directly or indirectly, five percent or more of any class of voting securities, or 10 percent or more of the total equity, of the combined organization. Your response should indicate whether any identified shareholder is a bank or bank holding company. In calculating the voting ownership, include any warrants, options, and other convertible instruments, and show all levels of voting ownership on both a fully diluted and an individually diluted
basis. Aggregate the interests of any related shareholders, including, for example, shareholders that are acting in concert (pursuant to definitions and presumptions in 12 CFR 225.41) and shareholders that are commonly controlled or advised.

2. Your October 8, 2014, letter responding to staff’s request for additional information (the “Response”) states that while “CIT and OneWest do not believe the proposed Transaction requires the consent of the GSEs . . . [t]he parties will provide the GSEs with formal notice of the transaction and engage with them as appropriate.” Provide the specific timeframes in which the parties will file a formal notice and consult with the GSEs about this proposed transaction.

3. The Response indicates that several integration planning decisions and actions have already been made or taken with respect to the integration of the CIT and IMB organizations. Confirm or clarify our understandin that the decisions and actions identified in the Response will not apply to the companies and their operations prior to the Board’s approval of the proposed transactions.

4. The Response also indicates that the parties will execute a number of actions prior to the closing of the proposed transaction “to ensure that, on ‘Legal Day One’, the combined institution operates in manner consistent with . . . expectations.” To the extent not already provided, identify all pre-closing actions that will be executed in connection with the integration of the CIT and IMB organizations.

  We will report on the responses, upon receipt.

  On BB&T, well before the bank's November 12 mega-merger announcement seeking to buy Susquehanna Bancshares for $2.5 billion, Inner City Press / Fair Finance Watch has been showing the disparities in BB&T's lending record.

  On BB&T's application to acquire 41 branches in Texas from Citibank, Fair Finance Watch showed the FDIC for example that for conventional home purchase loans in the Houston Metropolitan Statistical Area in 2013, BB&T made 65 such loans to whites, and NONE to African Americans.
 
  The FDIC's Acting Deputy Regional Director for Compliance replied that "the FDIC deems your correspondence to constitute a protest."

  BB&T through law firm Wachtell, Lipton, Rosen & Katz submitted a response which admitted that in Houston “the percentage of Mortgage Loans made to low and moderate income borrowers during the first six months of 2014 was also below the 2013 aggregate industry average.” BB&T Response at Page 11, which also notes at 10 that at least one of the Citibank branches BB&T seeks to acquire, it would shutter.

  And so on November 10 Fair Finance Watch submitted more extensive comment opposing BB&T's application to acquire Bank of Kentucky, including that bank's disparities in the Cincinnati regional area and BB&T's in the Louisville MSA, where in 2013 BB&T made 229 conventional home purchase loans to whites, and only 12 to African Americans and only six to Latinos, while denying 41.7% of applications from Latinos versus only 17.5 of application from whites, a disparity of 2.38 to 1.

   Now BB&T announces a much larger proposal, to buy Susquehanna and its 245 branches in Pennsylvania, New Jersey, Maryland and West Virginia. Such an application requires approval, after a comment period and possible public hearings, by the Federal Reserve. We'll have more on this.

  The secret recordings of then Federal Reserve examiner Carmen Segarra about Goldman Sachs and regulatory capture have given rise to calls for oversight hearings by at least two US Senators. Their hearing will now occur on November 21. Relatedly, BB&T's response from the law firm of Wachtell, Lipton, Rosen & Katz is penned by a former Federal Reserve Board Legal Division supervisor.

November 17, 2014

The Senate hearings on regulatory capture of the Federal Reserve, triggered by whistleblower Carmen Segarra's 46 hours of taped audio, are set for November 21. We'll be covering it.

November 10, 2014

After CIT Is Forced To Release Cash Flow & Risk Mgmt, ICP Slams Both

By Matthew Russell Lee

UNITED NATIONS, November 7 -- The secret recordings of then Federal Reserve examiner Carmen Segarra about Goldman Sachs and regulatory capture have given rise to calls for oversight hearings by at least two US Senators, and to spin from the Federal Reserve Bank of New York.

 On November 7, Inner City Press was sent a redacted copy of CIT Group's "Cash Flow Projections" and "Risk Management" from its application to acquire OneWest and go above the $50 billion, Too Big Too Fail threshold. Inner City Press immediately put the partially redacted document online on its website, here.

  First, how could such information be withheld for a bank seeking to become Too Big To Fail?

  Second, how could the Federal Reserve insist that the comment period is closed, while information that was improperly withheld is belatedly released?

  On October 10, Inner City Press was sent heavily redacted copies of two letters from the CIT Group concerning its proposed acquisition of OneWest to the Federal Reserve Bank of New York, supposedly in compliance with the Freedom of Information Act - now uploaded to Scribd here and here.

   On October 18, Inner City Press & Fair Finance Watch challenged these redactions under FOIA, and submitted  comments on CIT's mockery of the Community Reinvestment Act to both the Federal Reserve and the Office of the Comptroller of the Currency.

  CIT sought to withhold even its CRA plan. Inner City Press raised the issue to Fed Chair Yellen in Washington

November 3, 2014

Now CIT says, “In a comment letter, dated October 18, 2014, from Inner City Press/Fair Finance Watch, [FFW] states that CITB’s assessment area is improper. CITB’s assessment area was designated in accordance with the federal banking agencies’ CRA regulations and guidelines.” They are referring to limited their CRA assessment area to Utah, while admitting their business in New York, New Jersey, Florida and elsewhere. #RegulatoryFail

CIT also cites the Fed's previously laxity as precedent: “Letter from William W. Wiles, Secretary of the Board, to Inner City Press/Community on the Move, 1995 Fed. Res. Interp. Ltr LEXIS 240 (August 29, 1995).”

October 27, 2014

  While the Federal Reserve lists contacts for its Reserve Banks, they are only phone numbers, not email. And most Reserve Banks don't make it clear to the public and community groups how to submitte comments by email. Why not? We'll have more on this.

October 20, 2014

  The Federal Reserve extended its CIT comment period one week, but it still withholding. ICP has submitted:

As to CIT's October 8 letter, ICP has already timely commented “there is also the question of the agreement the FDIC reached with IndyMac / OneWest, and whether wannabe SIFI CIT would assume it, as a windfall. These are important questions militating for both the required extension of the comment period, and for public hearings.”
 
  In the October 8 letter, CIT begins a sentence on page 3 “Clawback provisions exist for the First Fed and La Jolla portfolios [REDACTED.]” CIT also redacts, on page 6, information related to the OnWest / IndyMac Consent Order; HAMP (Page 7); deposits collected over the Internet (Page 8); Lending (Page 9); Governance and Risk Management (page 10-12); and Resolution Plan (Page 12). CIT also heavily redacts what it calls “confidential questions” (pages 14-16), and exhibits. This information must be released, and the comment period extended.  In an abundance of caution, ICP has submitted a FOIA request to this effect to the Federal Reserve. Watch this site.

October 13, 2014

After Fed Exposed, CIT Gives ICP Redacted Letters to FRBNY, Captured

By Matthew Russell Lee

UNITED NATIONS, October 10 -- The secret recordings of then Federal Reserve examiner Carmen Segarra about Goldman Sachs and regulatory capture have given rise to calls for oversight hearings by at least two US Senators, and to spin from the Federal Reserve Bank of New York.

  On October 10, Inner City Press was sent heavily redacted copies of two letters from the CIT Group to the Federal Reserve Bank of New York, supposedly in compliance with the Freedom of Information Act - now uploaded to Scribd here and here.

  Inner City Press / Fair Finance Watch has asked the Fed to extended / re-open the comment period.

There is also the question of the agreement the FDIC reached with IndyMac / OneWest, and whether wannabe SIFI CIT would assume it, as a windfall. These are important questions militating for both the required extension of the comment period, and for public hearings.

October 6, 2014

After the Federal Reserve / Goldman Sachs audio leaks by whistleblower Carmen Segarra, Senators Elizabeth Warren and Sherrod Brown have called for hearings. But will they be held? We're ready -- regulatory capture is widespread...

September 29, 2014

As Whistleblower Exposes Fed & Goldman, FOIA Requests Show CIT Capture

By Matthew Russell Lee

UNITED NATIONS, September 26 -- The secret recordings of then Federal Reserve examiner Carmen Segarra about Goldman Sachs and regulatory capture should trigger oversight hearings in Congress, and the break-up of Goldman Sachs and its peers.

 But this type of sleaze is the rule, not the exception. Inner City Press routinely submits Freedom of Information Act requests for communication between the Fed and banks applying for mergers.

  Most recently, the Fed has extended its deadline for responding to Inner City Press' request on CIT - OneWest, on which it purported to close its public comment period on September 24:

FOIA Request No. F-2014-00380

Dear Mr. Lee,

On August 27, 2014, the Board of Governors ("Board") received your electronic message dated August 26, pursuant to the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552... On August 28, 2014, the Board’s Freedom of Information Office made an interim production of responsive documents consisting of the public portion of the application by CIT Group Inc. and Carbon Merger Sub LLC to acquire and merge with IMB HoldCo LLC, and thereby indirectly acquire voting shares of OneWest Bank... Pursuant to section (a)(6)(B)(i) of the FOIA, we are extending the period for our response until October 9, 2014, 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 October 9, 2014, we will respond to you promptly.

How can the public be shut out before it has the basic information it has requested?

Tellingly, when lawyers leave the Federal Reserve's Legal Division, many go to white shoe law firms that submit bank merger applications to the same people they until recently worked with or supervised.

  Inner City Press, Bronx-based Fair Finance Watch and NCRC have repeatedly raised this to the Fed, without meaningful response.

So here's hoping that Carmen Segarra's courage, in secretly making the recordings and then releasing them, leads to increased oversight of and reform at the Fed.

 The problem is, while some in Congress are willing to criticize the Fed, the real parties in interest here are the largest banks and investment banks in the country. Who in Congress will directly challenge those? Watch this site.

September 22, 2014

How can the Federal Reserve Board take until September 18 to respond to a FOIA request from May 28 on a pending application? We'll have more on this.

September 15, 2014

Fed Governor Tarullo's testimony to Congress last week was widely viewed as a call to shink the size of the US mega-banks. But the Fed has been so solicitous to them, can they be believed?

September 8, 2014

Here's what the Fed said, more than 10 days ago, without providing the bank's CRA Plans:

Dear Mr. Lee,

This is in reference to your electronic message dated August 26, 2014, and received by the Board’s Freedom of Information Office August 27. Attached is the public portion of the application by CIT Group Inc. and Carbon Merger Sub LLC to acquire and merge with IMB HoldCo LLC, and thereby indirectly acquire voting shares of OneWest Bank, N.A., including Carbon Merger Sub LLC’s application to become a bank holding company.

Board staff are currently processing the remainder of the FOIA request, which seeks the confidential portions of the application and all records reflecting FRS communications with or about the two entities (or their affiliates) regarding the proposal since January 1, 2014.

Freedom of Information Office, Federal Reserve Board

September 1, 2014

So Inner City Press / Fair Finance Watch requested from the Federal Reserve Board, under the Freedom of Information Act no less, the application by CIT Group to buy OneWest. As provided, the Fed has for now allowed CIT and its outside counsel to withhold from the public CIT's and OneWest's Community Reinvestment Act plans. We'll have more on this.

August 25, 2014

Noteworthy: on August 22, the Federal Reserve Board “requested comment on a proposal to repeal its Regulation AA (Unfair or Deceptive Acts or Practices).”

August 18, 2014

How can Fed vice chair Stanley Fischer give a long speech in Sweden about the “Great Recession” and not once in it mention “subprime,” much less Citigroup?

August 11, 2014

On August 6 the Fed announced “it has not objected to a resubmitted capital plan from Bank of America Corporation. The Federal Reserve in April required Bank of America to resubmit its capital plan and to suspend planned increases in capital distributions. The action followed the disclosure by Bank of America that it incorrectly reported data used in the calculation of regulatory capital ratios and submitted as inputs for the stress tests conducted by the Federal Reserve in 2014.”

But what about disclosing, census tract, any predatory lending settlement it reaches?

August 4, 2014

The Fed and official corruption: On July 23 Thomas Baxter, General Counsel for the New York Federal Reserve Bank questioned the FCPA’s “exception for ‘facilitating or expediting payments’ made in furtherance of routine government action.” Baxter stated that “official corruption is a problem that some U.S. financial institutions have found challenging during the last year.”

Ya don't say...

July 28, 2014

The CFPB is “proposing that financial institutions provide more information about underwriting and pricing, such as an applicant’s debt-to-income ratio, the interest rate of the loan, and the total discount points charged for the loan.” Good - but what about the small business data?

July 21, 2014

The Federal Reserve Board's website claims that it will be updated on pending mergers every three days. But on July 19, there had been no update since July 9 -- ten days...

July 14, 2014

Fed Vice Chairman Stanley Fischer gave a long speech at the National Bureau of Economic Research in Cambridge on July 10 about Financial Sector Reform -- and didn't mention the words “subprime” much less “predatory” lending even once. Ah, Citigroup...

July 7, 2014

IMF's Lagarde Lauds Yellen, After Urging Fed to Communicate More, FOIA Qs

By Matthew Russell Lee

UNITED NATIONS, July 2 -- When the International Monetary Fund's Christine Lagarde introduced Federal Reserve chair Janet Yellen to give the first Michel Camdessus Central Banking Lecture on July 2, she did not repeated what she said only two weeks earlier, that the Fed should communicate more frequently.

  In laying out lessons learned from the subprime financial meltdown of 2008, Lagarde did not question the role of the Federal Reserve in failing to take action on the predatory lending by the Big Four banks, or the pooling and pitching by investment banks of predatory mortgages by Ameriquest, New Century, et al.

  So what, really, was learned?

 On July 2, Lagarde compared central bankers to mountaineers, and told Yellen, "Janet, you may not be surprised to know that when you give your press conferences a group of passionate staff here at the IMF get together to watch you live on screen. I am told they even bring pop corn to the meetings!"

June 30, 2014

The Federal Reserve has rubber stamped a number of Regions Bank mergers. But on June 25, the Fed “announced that Regions Bank, Birmingham, Alabama, will pay a $46 million penalty for misconduct related to the process followed by the bank in the first quarter of 2009 for identifying and reporting non-accrual loans. The Federal Reserve also issued a consent order requiring Regions Bank to continue to improve its relevant policies and procedures. The Federal Reserve's consent order is being issued jointly with the Alabama Department of Banking, which is assessing Regions Bank a $5 million penalty, and in conjunction with actions by the Securities and Exchange Commission.”

June 23, 2014

The name "RAYS Act" is a nod to its intellectual godfather - Ray Boshara, director of the Center for Household Financial Stability at the Federal Reserve Bank of St. Louis...

And in San Francisco, kids enrolled in school are shunted into bank accounts at... Citibank.

June 16, 2014

On June 9 in DC, Fed Governor Tarullo said “Mergers and acquisitions involving banking organizations are subject to review, and possible disapproval, on a broad range of grounds beyond the antitrust considerations relevant in all industries. These include an assessment of the adequacy of the financial resources of the firms, the "competence, experience, and integrity" of the officers and directors, and the impact of the acquisition on systemic risk. [FN3] Bank Holding Company Act of 1956 §3, 12 U.S.C. §1842(c). The Bank Merger Act requires consideration of a roughly comparable set of factors. Acquisitions are also subject to special scrutiny where an acquiring firm has less-than-satisfactory supervisory ratings.”

What about the Community Reinvestment Act?

June 9, 2014

The majority of applications at the Federal Reserve with comment periods open are under the Change in Bank Control Act - which makes this a test case: “Mr. Lee, Attached you will find a letter acknowledging your May 30 comments on the change in control notice filed by Mr. Love, as well as our transmittal letter to Notificant counsel.” We'll see.

June 2, 2014

ICP / Fair Finance Watch filed this with the Fed:

Dear Chair Yellen, Secretary deV. Frierson and others in the FRS:

Since 2013 Inner City Press / Fair Finance Watch (ICP) has been watching with interest and concern the protested Midlands - Heartland proposal (see sample HMDA analysis below). Then it became aware of a related Change in Bank Control Act notice, which has given rise to public concern and confusion, for example:

Midland States Bank Acquisition of St. Louis Bank Continues

Published on May 16 2014 5:41 am

The previously-announced acquisition of Heartland Bank in St. Louis by Midland States Bank of Effingham is moving ahead with the formal request by the owners of Heartland to the Federal Reserve Board to acquire 10% or more of the shares of Midland States Bancorp.

Midland States Bancorp, based in Effingham, controls Midland States Bank. Midland announced last year that it was acquiring Heartland Bank, which has 13 locations in St. Louis as well as one in Denver, Colorado. As part of the transaction, the Love family, which currently owns Heartland, will be acquiring Midland States Bancorp stock.

Midland States Bancorp President and CEO Leon Holschbach said the acquisition is proceeding as planned. Holschbach said no one should be concerned that a legal notice about the Love family acquiring stock in Midland means a change in control of Midland. He said the term "control" in the legal notice means that the Loves will have as much say in the bank as their share of stock gives them. Holschbach said the vast majority of Midland States stock is still in the hands of Effingham families.

Holschbach said the acquisition of Heartland Bank by Midland States Bancorp should close early in the third quarter. He said the Heartland Bank locations will be changed to Midland States Bank locations, while a credit lending firm in St. Louis will remain Heartland Business Credit, but will be listed as a subsidiary of Midland States Bank.

That even the applicants saw confusion among the public which they sought to assuage - without, of course, saying there is a public review and comment process -- is indicative. Inner City Press filed a Freedom of Information Act request and yesterday, May 29, received this:

Dear Mr. Lee,

This is in reference to your electronic message dated and received by the Board’s Freedom of Information Office on May 28, 2014, in which you request the following:

the Change in Bank Control Notice by Andrew Sproule Love, Jr., St. Louis, Missouri, acting individually, and in concert with a control group, which consists of Andrew Sproule Love, Jr.; Trust Established U/T/W of Andrew Sproule Love FBO Andrew Sproule Love, Jr., Andrew Sproule Love, Jr., and Bank of America, N.A., as co-trustees; Inter Vivos Trust created by Andrew Sproule Love U/I/T dated December 30, 1941, as amended by instrument dated August 3, 1959, Andrew Sproule Love, Jr., and Bank of America, N.A., as cotrustees; Love Group, LLC; Love Investment Company; Love Real Estate Company; and Sarah Otto Love, all of St. Louis, Missouri; Daniel Sproule Love, New York, New York; Laura Kate Love, Bozeman, Montana; Martha Farr Love, and John Overton Robertson, both of Portland, Maine; Amy Farr Robertson, Denver, Colorado; Bruce Clendenin Robertson, Rockville, Maryland; Caroline Bill Robertson Evans, Jacksonville, North Carolina, and Laurence Arnold Schiffer, St. Louis, Missouri; to acquire voting shares of Midland States Bancorp, Inc., and thereby indirectly acquire voting shares of Midland States Bank, both in Effingham, Illinois.

Attached is the public portion of the Change in Bank Control Notice. The remainder of the FOIA request, which seeks the confidential portions of the application and seeks FRS communications with the Notificants and/or Target regarding the proposal since January 1, 2014 is currently being processed by Board staff.

Thank you,

Freedom of Information Office

Federal Reserve Board

While the turn-around time on the “public” portion of the notices is appreciated, we are concerned at how much the applicants have asked the Fed to withhold, for example “Confidential” Attachment 3, “further discussion of the merger terms.”

ICP cannot yet submit a FOIA appeal, since the FRS has yet to rule on its FOIA request. ICP hereby requests that the information be released and / or the comment period on these notices extended -- and on the proposed (now amended) merger reopened -- until the information is released.

For the record, in 2012 Midland States Bank in the St Louis MSA for refinance loans made 197 such loans to whites and only two to African Americans, none to Latinos.

For conventional home purchase loans in the St Louis MSA in 2012, Midland State made 43 such loans to whites, none to African Americans or Latinos (which received one each in Table 4-1).

For home improvement loans in the St Louis MSA, Midland State made eight such loans to whites, none to African Americans or Latinos.

On the current record, including those raised by NCRC members incorporated herein by referecne, hearings should be held and the applications / notices should not be approved.

May 26, 2014

Federal Reserve Bank of San Francisco President John Williams said May 22 that he's surprised by weakness in the housing sector. He said, "While home construction and sales showed substantial momentum in 2012 and the first half of 2013, the wind has been taken out of the sails since then.” Sail away.

May 19, 2014

With Governor Stein in his way on May 28, how can the Federal Reserve legitimately function with only three Governors? Inner City Press / Fair Finance Watch raised the question in a recent filing. What will Congress say? Watch this site.

May 12, 2014

   On rogue bank Mercantile the follow has been filed with the Federal Reserve:

This is a timely request for reconsideration of the Board's May 8, 2014 approval of the Applications of Mercantile Bank Corporation to merge with Firstbank Corporation and thereby indirectly acquire Firstbank

Starting in October 2013, Inner City Press / Fair Finance Watch on fair lending grounds protested the Applications of Mercantile Bank Corporation to merge with Firstbank Corporation and thereby indirectly acquire Firstbank. For example, in 2012 in the Grand Rapids MSA for conventional home purchase loans, Mercantile Bank lent ONLY to whites. Its mortgage company made 42 such loans to whites, NONE to African Americans or Latinos.

To assess in Mercantile's record is improving or further deteriorating, ICP asked Mercantile through counsel for its 2013 HMDA-LAR. Amazingly and tellingly, Mercantile provided its LAR only in paper form, so that it could not be computer analyzed. This contrasts to other banks' timely responses to ICP with their LAR in the requested .DAT format in which it is filed.

This is outrageous. Even with only four Governors, for the Board to allow this is a dereliction of the Board's duty under HMDA, under CRA and the BHC Act. While there are numerous other problems with Mercantile and its proposals, we are limited this request for reconsideration to this issue so that the Board must squarely face this issue and shoulder its responsibilities.

To date, the Board's inaction on Mercantile's lawless behavior is reflected by this:

Mike Price, Mercantile’s chairman and CEO, maintained Mercantile complied with the letter of the law when it emailed the documents to Lee’s organization several weeks ago. 'Mercantile Bank has complied with everything it’s supposed to have complied with,' Price said. 'He may want electronic forms, but that’s the form we delivered it in'... Mr. Lee can interpret data anyway he wants,' Price said.. 'I know what the bank stands for and what it’s concern for the community is and its pretty darn strong.'”

In 2012 in the Grand Rapids MSA for refinance loans, Mercantile Bank lent ONLY to whites. Its mortgage company made 159 such loans to whites. It had a 100% denial rate for African American applicants. That's strong evidence of discrimination - followed by an attempt to conceal its 2013 record.

After that quote, in connection with Mercantile's shareholders' meeting, Price predicted the Board's rubber-stamp:

"'We have a pretty strong feeling that we’re very close to the end of the process and that we will have an answer fairly soon,” Price said this morning during the annual meeting of Mercantile Bank shareholders... Inner City Press/Fair Finance Watch claims that Mercantile Bank has a poor record of residential mortgage lending to minorities. The objections triggered a higher level review of the deal and 'it takes a longer time to walk through the process,' said Price, who anticipates an affirmative decision from the Federal Reserve. Price said Lee is 'cherry-picking data.'”

There are simply no loans to people of color to pick: In 2012 in the Grand Rapids MSA for home improvement loans, both Mercantile's bank and mortgage company lent only to whites.

After the Board's four-Governor order

Mike Price said, 'This approval validates our history of community involvement and outstanding performance under the Community Reinvestment Act, and follows a thorough analysis of our lending practices.'”

With Price's knowledge and presumably at his initial direction, Mercantile sought to and did conceal its 2013 record from the public.

This issue must be directly presented to each Governor, not only the FRS staff, the issue should be addressed and ruled on in writing, and the approval should be reconsidered and rescinded.

May 5, 2014

So Fed Chair Yellen went to the White House Correspondents Dinner - but didn't reconsider Umpqua - Sterling approval or explain why under CRA is it now ok to "commit to commit" later...

April 28, 2014

So the Fed asked Old National, or its outside counsel at Krief DeVault LLP in Indianapolis, what the public benefit of acquiring United Bancorp in Ann Arbor might be, telling them to send a copy to Inner City Press / Fair Finance Watch. But there's a problem: despite the clear instructions in ICP's comment letters, Old National / Krief DeVault send a previous submission to the wrong place, then resent, late, And this one?

April 21, 2014

Inner City Press / Fair Finance Watch has filed a timely request for reconsideration:

Board of Governors of the Federal Reserve System
Attn: Chair Janet Yellen, Secretary Robert deV. Frierson
20th Street and Constitution Avenue, N.W., Washington, DC 20551

Re: Timely Request for Reconsideration of the Board's April 1 "Conditional" Approval of the the Applications of Umpqua Holdings Corporation to merge with Sterling Financial Corporation and thereby indirectly acquire Sterling Savings Bank

Dear Chair Yellen, Secretary Robert deV. Frierson, General Counsel and others in the FRS:

This is a timely request for reconsideration of the Board's April 1, 2014 "conditional" approval of the Applications of Umpqua Holdings Corporation to merge with Sterling Financial Corporation and thereby indirectly acquire Sterling Savings Bank.

Inner City Press / Fair Finance Watch and others, including other members of NCRC, submitted comments weaknesses in the lending records of Umpqua and Sterling, weaknesses confirmed by the FDIC and the Board. The conditional approval order states that

"the Board’s review indicates that low volume of loan applications is a key factor in Umpqua Bank’s relatively low volume of lending to LMI individuals, to African American, Asian, and Hispanic individuals, and to small businesses in predominantly minority census tracts, in certain of its assessment areas, as compared with the aggregate. To that end, Umpqua has committed that, within 60 days following consummation of the merger with Sterling, Umpqua will develop a plan consistent with the combined organization’s size and complexity, to assist the combined organization in continuing to help meet the credit needs of its communities, in accordance with the CRA. The plan will establish specific performance goals and measures to assist the combined organization in helping to meet community credit needs, including through outreach and marketing of its products and services to LMI and underserved individuals and communities and by identifying opportunities for community development–related investments in its communities."

While the only enforcement mechanism of the Community Reinvestment Act is in connection with merger and expansion applications, the above impermissibly grants approval for a later, unspecified plan.

It is not even stated that the plan will be public. That should be confirmed in connection with this request for reconsideration.

Since April 1, consider also:

Blank Rome LLP | Target Data Breach Suit By Banks Extends To ...Linex Legal (press release) (registration)-Apr 10, 2014 0:14-cv-00643, by Umpqua Bank, Steinhafel's statement “omits” the fact that “it is the nation's financial institutions—and not Target—ensuring that this is the case ...

and

April 9, Courthouse News, "As their trial date approached, a class has settled claims that Umpqua Bank uses special software to maximize the amount of overdraft fees it charges. The parties have until May 19 to move for preliminary approval of the settlement, U.S. District Judge Jon Tigar said in a Friday order vacating the trial schedule."

The Order, referring to ICP's comments, states that

"A commenter also suggested that a conflict of interest exists because a former Secretary of the Treasury will be affiliated with a shareholder of the combined organization. No evidence of a conflict was presented, and the Board expects that the parties involved will abide by all laws governing conflicts of interest."

For example, the OCC has anti revolving door rules for transfer between itself and national banks. Here, former Treasury Secretary Geithner through Warburg Pincus colorably engaged in the same thing. ICP said that a hearing was needed, and reiterates that.

April 14, 2014

   Inner City Press / Fair Finance Watch has been challenging BancorpSouth, now this:

April 12, 2014

Board of Governors of the Federal Reserve System
Attn: Chairman Janet Yellen, Secretary Robert deV. Frierson
20th Street and Constitution Avenue, N.W.
Washington, DC 20551

Re: The Applications of BancorpSouth to merge with Ouachita Bancshares Corporation and thereby indirectly acquire Ouachita Independent Bank, and with Central Community Corporation, and thereby indirectly acquire First State Bank Central Texas, Austin, Texas

Dear Chairman Yellen, Secretary Robert deV. Frierson and others in the FRS:

This concerns the Applications of BancorpSouth to merge with Ouachita Bancshares Corporation and thereby indirectly acquire Ouachita Independent Bank, and with Central Community Corporation, and thereby indirectly acquire First State Bank Central Texas, Austin, Texas.

Back on March 24, ICP submitted comments on BancorpSouth's Ouachita / Louisiana application on March 24, receiving in the two week after only this:

From: Juanetta Price <juanetta.price@frb.gov>

Date: Mon, Mar 24, 2014 at 4:18 PM

Subject: Automatic reply: Request for Full Copy of, & Timely Comments On, Requesting Hearings & an Extension of the Comment Period On the Applications of BancorpSouth to merge with Ouachita Bancshares Corporation and thereby indirectly acquire Ouachita Independ...

To: "Matthew R. Lee" at InnerCityPress.org

I am out of the office until March 31.

As noted in ICP's timely April 7 comments on BancorpSouth's Central Community Corporation proposal, the public portions of applications should be given on a timely basis, and timely comments acknowledged.

Then, on April 8 -- two weeks after ICP's March 24 request -- this arrived:

Subject: Public Portion of Application BancorpSouth - Ouachita
From: Windsor, Cathie [at] stls.frb.org
Date: Tue, Apr 8, 2014 at 5:53 PM
To: Lee [at] fairfinancewatch.org, Inner City Press
Cc: "Sparks, Yvonne S [at] stls.frb.org,Blase, Dennis [at] stls.frb.org, Goldberg, Amory R (Board) [at] frb.gov

Dear Mr. Lee:

Attached is the public portion of the application by BancorpSouth, Inc. to merge with Ouachita Bancshares Corporation and thereby indirectly acquire Ouachita Independent Bank.

There was no explanation of the two week delay. The next day, April 9, this arrived:

Subject: Revised Public Portion of Application BancorpSouth - Ouachita
From: Windsor, Cathie [at] stls.frb.org
Date: Wed, Apr 9, 2014 at 11:48 AM
To: Lee [at] fairfinancewatch.org, Inner City Press
Cc: Sparks, Yvonne S [at] stls.frb.org

Dear Mr. Lee:

Please disregard the public portion of the application sent to you yesterday for BancorpSouth, Inc. to merge with Ouachita Bancshares Corporation. It appears that pages 1-32 were left out.

Leaving out pages, it happens. But what of the two week gap in providing any of the public portion of the application? Inner City Press asserts and request that the comment periods be extended. ICP also notes that on April 10 BancorpSouth announced yet another proposed acquisition, of Lafayette, La.-based Knox Insurance Group, LLC.

Reviewing the 2012 HMDA data released by the FFIEC (and largely unaddressed in existing CRA performance evaluations and fair lending exams), ICP has examined BancorpSouth's conventional home purchase lending in the Jackson, Mississippi, Baton Rouge, Louisiana and Memphis, Tennessee MSAs and finds them troubling.

In 2012 in the Jackson MS MSA for conventional home purchase loans, BancorpSouth made 258 loans to whites, only 17 to African Americans and five to Latinos. BancorpSouth's denial rate for whites was 7.4% while for African Americans it was 25.8% -- 3.49 times higher. This is troubling.

In 2012 in the Baton Rouge LA MSA for conventional home purchase loans in 2012, BancorpSouth made 60 such loans to whites; only three to African Americans and one to a Latino.

On March 24 we stated: next time we will analysis next-door Texas. But for now, in 2012 in the Memphis TN MSA for conventional home purchase loans, BancorpSouth made 243 loans to whites, only 14 to African Americans and four to Latinos. BancorpSouth's denial rate for whites was 4.2% while for African Americans it was 22.7% -- 5.4 times higher. This is outrageous.

On April 7 we stated: BancorpSouth in 2012 did not report any data in the Austin, Texas MSA. First State Bank Central Texas, for home purchase loans there, made 13 such loans to whites, NONE to African Americans or Latinos. Likewise, it made no refinance loans to African Americans or Latinos.

Now we note that BancorpSouth in the Lafayette, Louisiana MSA in 2012 for conventional home purchase loans, BancorpSouth made 37 loans to whites, NONE to African Americans or Latinos. In Table 4-1, BancorpSouth made 15 loans to whites and ONE to an African American applicant. That is, ALL of its home purchase loans to people of color were in Table 4-1, none in Table 4-2. This is troubling, and a pattern. The comment periods must be extended.

BancorpSouth should be required to fully disclose all branches it would close, and other changes, before the comment period closed. After for example the precedent of Huntington (and, in the Northeast, of Rockville and United in Connecticut and Massachusetts), both of which disclosed which branches they would close during the comment period, Huntington even re-starting the comment period to do so, to not extend this comment period on these five or more branches would be a major step backward for the Federal Reserve.

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

If you have any questions, please immediately telephone the undersigned, at (718) 716-3540.

Very Truly Yours,

Matthew Lee, Executive Director, Inner City Press/Fair Finance Watch

April 7, 2014

From the Federal Reserve's Umpqua - Sterling order:

"The Board’s review indicates that low volume of loan applications is a key factor in Umpqua Bank’s relatively low volume of lending to LMI individuals, to African American, Asian, and Hispanic individuals, and to small businesses in predominantly minority census tracts, in certain of its assessment areas, as compared with the aggregate. To that end, Umpqua has committed that, within 60 days following consummation of the merger with Sterling, Umpqua will develop a plan consistent with the combined organization’ size and complexity, to assist the combined organization in continuing to help meet the credit needs of its communities, in accordance with the CRA. The plan will establish specific performance goals and measures to assist the combined organization in helping to meet community credit needs, including through outreach and marketing of its products and services to LMI and underserved individuals and communities and by identifying opportunities for community development–related investments in its communities."

But will it be public? It should be. Watch this site.

March 31, 2014

The Fed last week banned the "U.S. units of HSBC Holdings PLC, Royal Bank of Scotland Group PLC, and Banco Santander SA from increasing the dividends they send overseas after their "stress test" results didn't meet the Fed's standards." We'll have more on this.

March 24, 2014

The Federal Reserve has hit a new low: in its "public record" on M&T's stalled-out application to acquire Hudson City Savings Bank, the Fed has only 2012 HMDA data. So last week Inner City Press / Fair Finance Watch submitted analysis of the just-obtained 2013 data. But the Fed sends back essentially a form letter, you have not shown exceptional circumstances that would warrant providing additional time to comment on the proposal, cc-ing one of its former FRB Staff Counsels now representing M&T. Isn't getting up to date information, instead of data more than a year old, enough of a reason to put the comment in the record?

March 17, 2014

So Umpqua Bank has committed to commit - it has told the Federal Reserve that it will (or would) submit a CRA plan sixty days after it consummates its proposed acquisition of Sterling Bank. But will Umpqua's plan be made public? And will it be able to be enforced? The Federal Reserve should answer this.

March 10, 2014

Should the Federal Reserve really be parading big bank representatives as its experts on the CRA?

March 3, 2014

In the Senate, new Fed chairperson Yellen said "there’s no intersection at all in any way between Bitcoin and banks that the Federal Reserve has the ability to supervise and regulate. So the Federal Reserve simply does not have authority to supervise or regulate Bitcoin in any way."

February 24, 2014

The Fed's Eric Kollig declined to comment when asked about Mercantile Bank of Michigan, whose CFO Chuck Christmas is dismissive of the CRA questions raised not only by Inner City Press / Fair Finance Watch, but also by the Fed (and FDIC), saying "there's nothing that has come up as far as we know in our communications that could cause us any angst." That's part of the problem, that Mercantile doesn't care or is in denial... But is the Fed enabling it?

February 17, 2014

On February 11, Senator Elizabeth Warren (D-MA) and Representative Elijah Cummings (D-MD) sent a letter to new Fed Chairman Janet Yellen, asking that she reverse Bernanke's policy of delegating supervisory and enforcement powers to staff. In the last 10 years, the Board voted on only 11 of nearly 1,000 enforcement actions, and that under current application of the Federal Reserve’s enforcement delegation policy, the Fed can enter into consent orders without ever receiving formal approval of senior staff. The letter urges that (i) the Board vote on any consent order that involves $1 million or more or that requires a bank officer to be removed and/or new management installed; (ii) staff formally notify the Board before entering into a consent order under delegated authority; (iii) each Board member be provided with the necessary staffing capacity to review and analyze pending enforcement actions; and (iv) all Board members receive a copy of all letters sent to the Chairman or another Board member by a committee or member of Congress.

But what about the Governors getting more involved in merger review, including CRA?

February 10, 2014

And now on Umpqua's application to acquire Sterling, the Federal Reserve has asked Umpqua if it has a CRA plan, first tweeted from @FinanceWatchOrg, and if it has one, to submitted a copy. We'll see.

February 3, 2014

So now the Fed has asked Umpqua and Sterling which branches they would close...

January 27, 2014

Is the Federal Reserve watching the Off Shore Leaks series? They should be. We'll see. Watch this site.

January 20, 2014

The Federal Reserve on January 17 asked Umpqua Bank a series of questions in connection with its proposal to acquire Sterling, challenged by Inner City Press / Fair Finance Watch, which has put the Fed's "Additional Information" letter online, first via @FinanceWatchOrg here: http://www.innercitypress.org/umpqua1frbicp011714.pdf

January 13, 2014

  One thing that should be expected from the Federal Reserve is to answer its mail -- on Huntington, for example. How can a bank holding company try to buy another (Camco) without submitting an application for review by (and public comment to) the Fed? Especially given the issues that have arisen? We will have more on this.

January 6, 2014

On January 3, the Federal Reserve announced that "the Board has enlisted the services of executive recruiting firm DiversifiedSearch to assemble a broad and diverse pool of candidates, both internal and external, from which to select Ms. [Sandra] Braunstein's successor." Given the financial industry's domination of the rest of the Federal Reserve System including several Governors, we believe that consumers and community groups should play a role in the selection process. Watch this site.

December 30, 2013

Another step at the Fed, on United: United has committed that, at the next CRA examination following consummation of the merger with VCB and consistent with the combined organization’s capacity and opportunities for making qualified lending and investments, the combined organization will demonstrate that it has engaged in levels of qualified lending and investments, home mortgage lending, small business lending, and community development lending and investments in low- and moderate-income communities in the Northern Virginia portion of United’s Multistate CSA assessment area, that exceed United’s improved performance in 2012. In addition, within thirty (30) days of consummation, United will develop a program, to apply across all assessment areas of the combined organization, with the objective of producing results exceeding United’s improved performance in 2012. United will submit the program to the Reserve Bank for review and implement the program across the combined organization’s assessment areas."

December 23, 2013

There are those who wonder, rightly, whether a Vice Chair of the Federal Reserve should be one who worked at Citigroup....

December 16, 2013

Asked about Inner City Press / Fair Finance Watch's commebts to the Federal Reserve about the lending record of Michigan's Mercantile Bank and its proposed acquisition of FirstBank, Fed spokesperson Susan Stawick replied, "I’m afraid I’m not able to speak specifically about the status of the timetable for this application. But I can tell you that Federal Reserve staff is performing due diligence regarding the concerns that have been expressed about the merger.”

Now, Mercantile has gone low. Its submissions to the Fed have gotten shrill; it has reached out to individual borrowers of color (and to ostensible civil rights and even religious groupings) asking them for letters to CEO Michael Price to give the Fed about how they never felt discriminated against. Click here for one sample letter: http://www.innercitypress.org/mercbankasia120213.pdf

This approach cannot be allowed to prevail. Watch this site.

December 9, 2013

The Fed's Investors - Roma order says that

"as a condition of its approval, the Board has determined that the audit committee of the board of directors of Investors Bancorp must issue a written report to the board of directors of Investors Bancorp that shall include: an assessment of Investors Bank’s consumer compliance risk systems, processes, and procedures; an assessment of compliance with any reports or recommendations made by any state or federal agency issued in the last five years with respect to consumer compliance; and recommendations for improving the consumer compliance risk program, if necessary."

This is a rare condition for the Federal Reserve to impose, at least on consumer compliance. But as Inner City Press' March 1 comment set forth, in the New York City Metropolitan Statistical Area in 2011, Investors made 220 home purchase loans to whites, and only two such loans to African Americans. That's hard to do in New York.

But will the Fed follow up on compliance? Will there be transparency? Watch this site.

December 2, 2013

The Federal Reserve and Wal-Mart: the Fed last week approved that "Green Dot Bank proposes to acquire assets and assume liabilities related to GPR cards issued by GECRB, sold at U.S.-based Wal-Mart stores and online through a website for the prepaid debit cards, and serviced by Green Dot pursuant to an agreement among the parties initially entered into in 2006. As a result of the proposed transaction, Green Dot Bank would replace GECRB as the issuer of Wal-Mart Cards." Abuse?

November 25, 2013

Inner City Press / Fair Finance Watch commented on Mercantile Bank's application to the Fed to acquire First Bank, based on disparate lending in Michigan. Now (November 20) Mercantile argues against the Fed having extended its review, arguing that to go beyond December 31 might mean First Bank would have have file an SEC Form 10-K for 2013. But what would giving in to this kind of argument mean for CRA? Does the Fed give in to these kind of arguments?

November 18, 2013

Michigan's Mercantile, trying to buy FirstBank, has responded to the Federal Reserve but withheld from Inner City Press three exhibits in their entirety, while telling the Fed they want to close the deal so to set up a conference call. Inner City Press contests the withholding, and any "ex parte" call, having now formally asked to be be notified of and allowed to be on any such call.

Meanwhile ex-regulator Tim Geithner is cashing out to private equity firm Warburg Pincus -- which has at least a 20% stake in Sterling, the Spokane-based bank that Umpqua has applied to the Federal Reserve to acquire for $2 billion. So $400 million of that would go to Warburg Pincus. This insider deal, Inner City Press / Fair Finance Watch has commented on, including on Home Mortgage Disclosure Act disparities and prospective branch closings. Watch this site.

November 11, 2013

Two weeks after Inner City Press / Fair Finance Watch filed comments on the proposed acquisition by Mercantile or FirstBank, the Federal Reserve on November 6 asked Mercantile some questions, including about CRA and fair lending, here: http://www.innercitypress.org/frb1mercbank110613.pdf

They were given eight business days to answer (and send a copy); their shareholders meet on the proposal on December 12...

Another challenge we're watching is to to application of Midland States Bancorp of Effingham, Illinois, to acquire Heartland Bank, filed from St. Louis, Missouri....

November 4, 2013

So Goldman Sachs' bank has been given an "Outstanding" CRA rating by the Federal Reserve and NYDFS, trumpeted in the Wall Street Journal. GS is given CRA credit for lending to the CitiBank program. But since the bike racks are all below 60th Street in Manhattan and in gentrified or gentrifying parts of Brooklyn -- a veritable redlining map -- why does this get CRA credit? It's a scam...

October 28, 2013

This has caught our eye: Carmen Segarra, a former senior examiner at the New York Fed filed a wrongful termination lawsuit saying she was fired after her supervisors asked her to change her findings on Goldman Sachs and she refused. "The New York Fed is now asking the judge to seal the case, arguing that the Fed is not a public institution and therefore not bound by the Freedom of Information Act." What? The Fed responds to FOIA requests all the time...

October 21, 2013

Last week's Intelligence Squared debate on breaking up the big banks featured "one of America's most outspoken Federal Reserve presidents, Richard Fisher"- on the side of breaking banks up. So what's he doing about it?

October 14, 2013

Yellen is the pick. Hopefully unlike Bernanke she understands that enforcing the Community Reinvestment Act ON merger applications is the law...

October 7, 2013

Even amid the government shutdown, the Fed keeps going -- it raises its funds independently...

September 30, 2013

The Federal Reserve Board seems to not know much about how banks in Chile -- like Banco de Creditor e Inversiones, trying to buy City National Bank of Florida -- are regulated. So why let them in?

September 23, 2013

So for JPMorgan Chase's sleaze, the Fed fines them only $200 million out of $920 million. And the beat goes on.

September 16, 2013

How can Larry Summers be considered to head the Fed? Questions will be asked. Watch this site.

September 9, 2013

Blast from the past: when Adams Bank and Trust applied to open a new branch in Nebraska, the Federal Reserve Board got "public comments received from prospective competing banks in Colby and from residents of the surrounding areas. The commenters assert that their community’s demographic and economic characteristics would not profitably support another branch and that the area’s financial services needs are adequately met by the financial institutions currently operating there." Saying "we don't want more banks" was one of the bases for the "convenience and needs" concept in US banking law...

September 2, 2013

The Federal Reserve has belatedly sent Inner City Press / Fair Finance Watch copies of letters it sent to M&T about its Hudson City Savings Bank -- the letters are directed to former Fed legal staffer Patricia Robinson, now representing M&T (and others) at Wachtell Lipton....

August 26, 2013

Inner City Press / Fair Finance Watch has raised to the Federal Reserve: How is the public to know of this newspaper notice, if they do not happen to buy and closely read the particular newspaper the Banks publish the notice?

We note that the Fed's H2A could and should but does not include the actual comment period. In this way, the public is being unnecessarily misled.

In the past when the Federal Reserve System published Reserve Bank's Weekly Bulletins, they would list the Federal Register AND the newspaper notice period. While we understand that Federal Register notice could not easily be re-published in cases like this, there is no reason that the Fed cannot keep its online H2A website current.

Watch this site.

August 19, 2013

Despite being bailed out by the public and some now waning populist rhetoric from Washington, the continuing bank merger proposals show no concern for the public or for job loss. Why should they, when President Obama considers Larry Summer, on the Board of Directors of the no-doc (and thus subprime) Lending Club, to head the Federal Reserve?

August 12, 2013

When Inner City Press / Fair Finance Watch submitted a comment to the Federal Reserve Board in Washington on August 8, so far the only response is an "out of office" message from Juanetta Price. We know things are slow, but come on...

August 5, 2013

So it's down to Larry Summers, Janet Yellen and Donald Kohn...

July 29, 2013

So Larry Summers has been "speaking at internal meetings at Citi beginning in 2012, Mr. Summers attended small gatherings of clients 'where he provides insight on a broad range of topics, including the domestic and global economy,' a Citigroup spokesman said. The bank wouldn't say how much it is paying him," per Damian Paletta. Next!

It's worth noting, as Inner City Press / Fair Finance Watch did, that Fed Governor Jerome Powell, denier of FOIA appeals, was previously with Deutsche Bank and the Carlyle Group...

July 22, 2013

So the Fed belatedly says it "is reviewing the 2003 determination that certain commodity activities are complementary to financial activities and thus permissible for bank holding companies." It all goes back to Citigroup and Phibro in 2003, or really to the Fed's lawless 2008 approval of Citi - Travelers. Full circle?

July 15, 2013

Governor Elizabeth “Betsy” Duke is leaving the Fed at the end of August. Back on May 28, 2007 we reported that “Duke listed major holdings of a previous employer, Wachovia Corp., in financial disclosure forms filed in conjunction with her nomination to join the Fed Board. According to the disclosure forms, released Friday by the Office of Government Ethics, Duke reported holdings of Wachovia stock valued at between $5,000,001 and $25 million. She also reported holding Wachovia stock options.”

July 8, 2013

So Governor Jerome H. Powell gave a speech in New York last Tuesday at the reception for Deutsche Bundesbank. No surprised - he used to work for Deutsche Bank.... Bundes, indeed.

Deutsche Bank, which got involved as a direct subprime lender and as a trustee, has been accused by the City of Los Angeles of facilitating illegal evictions. Its attempts to get the case dismissed were rejected in April by the court.

And so now a settlement for a mere $10 million, of which Deutsche Bank brags it is not paying anything, that would be the services and the securitization trusts. When does immunity become impunity?

July 1, 2013

Does the Federal Reserve have a typo, or is there another Investors Bancorp application?

Investors Bancorp, Inc. and Investors Bancorp, MHC., both of Short Hills, New Jersey (2 of 2) and thereby engage in operating a savings association pursuant to Section 225.28(b)(ii) of Regulation Y. 4 New York 07/08/2013

Investors Bancorp, MHC and Investors Bancorp, Inc., both in Short Hills, New Jersey to acquire Roma Financial Corporation MHC, & Roma Financial Corporation, Robbinsville, NJ, & indirectly acquire Roma Bank, Robbinsville, NJ, &d RomAsia Bank, South Brunswick Township, NJ & engage in operating savings associations -- 225.28(b)(4)(ii) 4 New York 03/01/2013

June 24, 2013

M&T's (cheap) anti money laundering deal with the Fed will probably move the deal along faster -- but the deal makes it pretty clear that the money laundering loophole is in Wilmington Trust, which the Fed let M&T buy in 2011.

So what does it say about the Fed's merger reviews? The Fed should come up with a plan to improve itself, in 60 days (and approve no merger during that time.) Compare the Fed not even fining M&T, while state regulators last week fined even an accounting firm which helped a bank (Standard Chartered) conceal money laundering...

June 17, 2013

How can it be that the third most recent "News" on the Federal Reserve's web site is a presentation by Ben Bernanke in March 2012 -- yes, 2012? http://www.federalreserve.gov/newsevents/default.htm

June 10, 2013

Fed governor Sarah Bloom Raskin went to Ohio, spoke of growing up in a town without a bank, then said "Let's talk about the importance of timely implementation of rules based on one set of international agreements--the Basel III framework... I fully support this goal, because the financial crisis demonstrated, among other things, the need for robust capital at banks of all sizes... Since Basel III sets a final deadline for implementation of 2019, one might ask why it is so imperative to act sooner."

Click here for Inner City Press' review of Tower of Basel.

June 3, 2013

So Guido Hinojosa Cardosa now tells the Fed that Anchor Bank would NOT be included in any reporting to the Bolivian regulators. What ever happened to comprehensive, consolidated HOME COUNTRY supervision?

May 27, 2013

So the Federal Reserve has belatedly on May 22 auto-confirmed receipt of ICP's May 17 comments on the CRA Q&A. Now what?

May 20, 2013

Check this out - more delay:

"On April 18, 2013, the Board of Governors (Board) received your electronic message dated April 17, 2013, pursuant to the Freedom of Information Act (FOIA), 5 U.S.C. § 552, for records pertaining to the following:

all records related to the M&T - Hudson proceeding, which ICP timely protested, which have not yet been provided to ICP under the FRS' rules against ex parte communications. . . this new FOIA request [is] for all records concerning the proceeding and the FRS' review, including all non-exempt portions of communications between the FRS and M&T, since the date ICP protested the application until the date of the FRS' response to this FOIA request.

Pursuant to section (a)(6)(B)(i) of the FOIA, we are extending the period for our response "

May 13, 2013

Oops! Rust Consulting short-changed those already ripped off on servicing by Goldman Sachs and Morgan Stanley. Hear the Fed scramble: http://www.federalreserve.gov/newsevents/press/bcreg/20130508a.htm

May 6, 2013

The Fed's hi-falutin predators:

"Payments to more than 220,000 borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley are scheduled to begin on Friday, May 3 following an agreement announced earlier this year by the Federal Reserve Board. Under the agreement, $247 million will be made in direct payments to borrowers whose homes were at any stage of the foreclosure process in 2009 and 2010 with the former subsidiaries of Goldman Sachs (Litton Loan Servicing LP) and Morgan Stanley (Saxon Mortgage Services, Inc.)."

April 29, 2013

Investors Bank tries to explain its weak lending to African Americans and Latinos to the Fed's Helen Troy, as it tried to Brian Steffey, by saying it does not originate loans -- Investors Home Mortgage does. But isn't it responsible?

Meanwhile the FDIC has unilaterally extended its time to respond under FOIA, to May 10.

April 22, 2013

Given that Inner City Press / Fair Finance Watch has challenged M&T - Hudson City Savings Bank since last Fall, how can it be that the Fed didn't give it documents about the regulatory issues in the applications process? Now Inner City Press has filed a separate FOIA request, beyond the rules against ex parte communications which the Fed, it seems, doesn't comply with...

April 15, 2013

After Inner City Press challenged the application of Guido Hinojosa to gain control of Anchor Commercial Bank, the Fed did ask Hinojosa some questions about his resignation from Banco de la Paz, which then fell apart. The response, just in, calls it a family affair. Indeed...

April 8, 2013

The Federal Reserve, as of April 5, lists on 78 pending applications subject to public comment under the BHCA, CIBC Act and HOLA -- a near record low. And some that are still listed have already been rubber stamps -- like First Merit....

April 1, 2013

On FirstMerit, the Fed said “The commenter referred to press releases issued by two rating agencies raising concerns regarding possible integration difficulties and FirstMerit’s entry into new markets. The commenter also referred to outstanding litigation associated with the proposed transaction.” The commenter was ICP Fair Finance Watch. But as the Fed was asked recently at the Capital Hilton, why doesn't the Fed name commenters? Is it only to try to deny standing?

March 25, 2013

When Federal Reserve Board Governor Sarah Bloom Raskin cited the “broken windows” theory, it hearkened back to James Q. Wilson and yes, Rudy Giuliani. But she took it in a different direction: what about when it's the banks who're breaking windows? Well what about it? If Bronxites get arrested to jumping the subway turnstile, what about destroying the world economy?

On March 22 an NCRC discussion ranged from the Federal Reserve withholding too much information under the Freedom of Information Act to allowing former Legal Division staffers to re-appear advocating before the people they used to work with, or under.

While we've always liked her, the case in point was Patricia Robinson, formerly of Fed legal, now representing banks on mergers. Is it appropriate? How to know, given the redactions? We will continue on this.

March 18, 2013

When the Federal Reserve granted a public hearing on Bank of Hawaii's plan to close its branches in American Samoa, leaving it in the hands of ANZ, it looks like the Fed did not provide correct public notice. A search on FederalReserve.gov press releases for Samoa finds nothing. For shame...

March 11, 2013

Ah, Investors... A response from the Federal Reserve “Board’s Freedom of Information office on March 1, 2013. Board staff are currently processing the remainder of your FOIA request, which seeks the confidential portions of the Notice and seeks any and all records reflecting FRS communications with the applicant regarding the proposal. The Office of the Secretary will send you a separate response addressing the remainder of the FOIA request."

March 4, 2013

With Bank of Hawaii trying to close over 50% of the branches in American Samoa, why would the Federal Reserve Bank of San Francisco gave a post to Bank of Hawaii chairman Peter Ho. We say, to remove taint of conflict of interest, now MUST hold public hearing on the planned American Samoa branch closures....

February 25, 2013

The Federal Reserve tells Inner City Press that

To facilitate secure email exchanges with the Federal Reserve, please see the attached file and link that contain instructions for registering with the Zix e-mail system. The web address is

https:// [THE WEB ADDRESS IS NOT RESPONSIVE TO YOUR FOIA REQUEST]”

Yes it is...

February 18, 2013

Hitting a new low, Customers Bancorp on its application to the Federal Reserve to acquire Acacia Federal Savings Bank has tried to withhold from Inner City Press the entirety of its response to Fed questions. We will be pursuing - the documents, and Customers Bancorp.

Meanwhile the Fed has reportedly sent a February 11 Q&A to Live Oak, with a confidential attachment -- but none of it, even the non-confidential portion, was sent to Inner City Press. Watch this site.

February 11, 2013

And now we know: while the Federal Reserve told community groups that the comment period on Live Oak – Government Loan Solutions, published in the Federal Register, had been in error, internally the lawyer for Live Oak asked the Fed on December 21, “Are we close on the Live Oak notice? I know the comment period has not closed quite yet, but I will be out of the office most of next week, so I thought I would check in this morning.”

The comment period still open, but the Fed “close” to deciding and approving anyway. This is shameful. An appeal is being filed with the withheld information, presumably even more shameful.

February 4, 2013

Talk about grading of the curve: last Fall Inner City Press / Fair Finance Watch began challenging Customers Bancorp, then on its proposal to buy Acacia. Now, Customers tells the Federal Reserve that "Fair Lending training is required annually of all employees with customer contact. It is administered via an online, self-paced course through the Edcomm Learning Management System. The employee is required to demonstrate adequate mastery of the course materials by completing a test at the conclusion of the course and obtaining a passing grade (minimum 80% correct).

80% is good enough for fair lending? For the Federal Reserve?

January 28, 2013

More Fed FOIA shenanigans:

This is a timely FOIA appeal to the Federal Reserve Board's January 11 partial denial of my FOIA request of some 11 weeks earlier for all portions of the applications / notices by Guido Hinojoso to acquire control of Anchor Commercial Bank for which Guido Hinojosa and his outside counsel improperly requested confidential treatment.

Some of these arrived some eleven weeks later, but with redactions to basic managerial information such as the answer to "have you ever been dismissed from past employment" including in the banking field. Biographical, 2b. Similarly, the FRB has redacted all answers about past bank merger applications, if they were denied (Biographical 5) including a paragraph answer about Change in Control (5b) and lawsuits (5e). All such information must be released.

Still partially redacted Exhibit 1G lists $500,000 purchase of shares in Sunrise Bank in 2011, and $5,500,000 for Anchor Commercial Bank in 2012. But it is now 2013. Was the gun jumped? Has this plan changed? The rest of the page is blacked out and must be released, and the comment period extended.

The "relationship to Notificant" column for both Patricio Hinojosa Jimenez and Jorge Hinojosa Jimenez is redacted - why? A member of CBIFSA's board of directors is redacted in full -- why? These must be released.

The Recitals, Definitions and much of "Subscription" of the Subscription Agreement are redacted - why? This must be released.

In "Turnaround," the "Summary of the Bank's Condition" is redacted - this must be released.

The "Commitments" (Confidential Exhibit 3) are withheld - but must be released. ICP is appealing this and all other redactions and withholdings.

The Deputy Secretary's letter (the "Denial") cites exemptions 4 and 6 and says their application to the heavily redacted pages provided is clear. It is not. Nor does the Denial state how many pages have been withheld in full.

January 21, 2013

Richmond Fed President Jeffrey Lacker has reiterated his claim that then-New York Federal Reserve President Timothy Geithner in 2007 notified Bank of America and other financial institutions that the U.S. central bank was considering lowering a critical interest rate.

January 21, 2013

Richmond Fed President Jeffrey Lacker has reiterated his claim that then-New York Federal Reserve President Timothy Geithner in 2007 notified Bank of America and other financial institutions that the U.S. central bank was considering lowering a critical interest rate.

January 14, 2013

Inner City Press has submitted a FOIA request to the Federal Reserve for all records related to the Federal Reserve System's comment period on Live Oak Bancshares' application to acquire Government Loan Solutions, Inc., of Cleveland, Ohio -- the initial comment period on which was said by the Fed to be January 4: http://www.ftc.gov/os/fedreg/2012/12/121210agencycollectionfrn.pdf

However at some later stage the Fed decided to shorten the comment period. We are specifically requesting all records concerning the change in comment date, as well as a full copy of Live Oak's application and all records reflecting the Federal Reserve System's communcations with or about Live Oak Bancshares or Government Loan Solutions for the past six months.

Watch this site.

January 7, 2013

The total lack of accountability of the Federal Reserve Board and of those it purports to regulate, for example Capital One which was fined $150 million in July 2012 for predatory practices, is on display in a Freedom of Information Act appeal denial issued on January 2 by Governor Jerome Powell, to Inner City Press.

Upholding in full the withholding of over 2000 pages of records related to Capital One's compliance or non-compliance with commitments it made during its NCRC protested purchases of ING DIRECT and HSBC's subprime credit card operations, Powell ruled that not one page, or even a portion of a page, would be released.

This is at odds, for example, with FOIA appeal responses obtained this year by Inner City Press from other Federal agencies. In other FOIA news, Inner City Press is a media amicus in this just filed brief in McBurney v. Young, No. 12-17 of the US Supreme Court.

But the Federal Reserve, along with Capital One, will have to be addressed in 2013. Watch this site.

December 31, 2012

The Federal Reserve and its Governor Jerome H. Powell have hit new lows. After delaying more than 40 days to rule on Inner City Press' FOIA appeal of withholdings about M&T - Hudson City Bancorp, Powell in a seven page ruling finds that the Fed mis-invoked FOIA exemptions 6 and 8 -- but then refuses to release the information, now invoking exemption 4. This is much worse even than previous FOIA appeal rulings -- a new low. We'll have more on this.

December 24, 2012

Back in August, Inner City Press / Fair Finance Watch wrote to Customers Bancorp for its mortgage data, expressing some concerns. A month later, at the deadline, some data was provided. It was disparate and Inner City Press comments on Customers' Acacia application. There were questions from the Federal Reserve, some FOIA requests. Now, Customer's has passed back the drop-dead date from December 31 to January 31. But how do they know it will be approved by then?

December 17, 2012

The Federal Reserve has responded thusly to a Freedom of Information Act request from Inner City Press:

To facilitate secure email exchanges with the Federal Reserve, please see the attached file and link that

contain instructions for registering with the Zix e-mail system. The web address is

https:// WITHHELD

For shame... Also From FirstMerit's submission to the Federal Reserve about Citizens Republic, the entire "Environmental Matters" section is blacked out, in response to Inner City Press' FOIA request...

December 10, 2012

Sometimes credit has to be given where it's due. The Federal Reserve increasingly grants large banks insider status, discussing their merger ideas with them before they are announced, allowing the large banks to be represented by recent Federal Reserve Board lawyers.

But now on the smaller Customers Bancorp - Acacia proposal, the Federal Reserve left Inner City Press a voice mail before they called Customers, then had information that the Fed requested sent to Inner City Press. Customers has another merger application coming up -- we'll see if the disparities and weakness in their record can be made to change.

Meanwhile, Inner City Press has filed this;

This is a formal request under FOIA for the portions of FirstMerit's November 30 response to FRS questions which were not sent to Inner City Press.

To virtually every FRS question about its proposal to acquire Citizens Republic, which ICP timely challenged and made a still pending FOIA request about, FirstMerit states, See Confidential Exhibit. For example, to FRS Question 1, FirstMerit says only, "See Confidential Exhibit 1."

To FRS Question 2, FirstMerit says only, "See Confidential Exhibit 2."

To FRS Question 3, FirstMerit says, "See Confidential Exhibit 3."

To FRS Question 5, FirstMerit says, "See Confidential Exhibit 4."

To FRS Question 6, FirstMerit says, "See Confidential Exhibit 6."

To FRS Question 7, FirstMerit says only, "See Confidential Exhibit 6."

To FRS Question 8 and 9, FirstMerit says only, "See Confidential Exhibit 7."

To FRS Question 10, FirstMerit says only, "See Confidential Exhibit 8."

To FRS Question 11, FirstMerit says only, "See Confidential Exhibit 9."

To FRS Question 12, FirstMerit says only, "See Confidential Exhibit 10."

To FRS Question 14, FirstMerit says only, "See Confidential Exhibit 11."

This is outrageous, and makes a mockery of the FRS' stated Rules against Ex Parte Communications. This is a timely challenge to all of the withholdings.

December 3, 2012

What is it about the Federal Reserve System, that one submits comments on a merger by e-mail, then awaits for snail mail confirmation? See, FirstMerit, Cleveland Fed.

November 26, 2012

Hudson City Savings Bank, which M&T is trying to buy, is in New Jersey but not of it. When ICP / Fair Finance Watch challenged the deal, highlighting disparities in Hudson City's record, Hudson City had no response at all. Now it has been challenged from New Jersey as well. Meanwhile the Fed has had no response to the absurdity of it providing heavily redacted records of its pre-announcement meetings with M&T, an hour before the comment period was set to expire. This is not transparency. Watch this site.

November 19, 2012

So the Fed hauled off and approved Mitsubishi UFJ to acquire UnionBanCal -- in footnote 22 it recites that ICP / Fair Finance Watch timely raise the issue of the ongoing LIBOR scandal. The Fed says that "the Board is monitoring the course of the investigations and will consider, to the extent of the Board's authority, the findings in those investigations as they develop."

To the extent of the Fed's authority??

In in footnote 44, it says that the issue ICP raised about Tax Refund Loans is a thing of the past. If so, no thanks to the Fed...

November 12, 2012

Fed Met M&T 10 Days Before Hudson Deal, FOIA Shows, Appeal & Protest

By Matthew R. Lee, Exclusive

SOUTH BRONX, November 9 -- When M&T on August 27 announced biggest bank merger deal of the year, a $3.81 billion proposal to buy Hudson City Savings Bank, it was not the first time the Federal Reserve had heard about.

  Inner City Press, which has challenged M&T's application under the Community Reinvestment Act, on November 9 got a belated Freedom of Information Act response from the Federal Reserve Board, less than two hours before the Fed said the extended comment period would close.

  The documents released to Inner City Press show that on August 17, a full ten days before the public announcement, Federal Reserve Bank of New York official John Ricketti wrote to five others within the Fed:

"Wilmers called me this afternoon to inform me that M&T is looking to acquire M&T. [sic] He will be talking to his board about the acquisition at next Tuesday's board meeting and asked to come in Wednesday to talk to us (we're setting something up for late Wednesday afternoon). I'll be up in Buffalo for the board meeting to discuss the [REDACTED] and expect to learn more from him Monday night (I have a one-on-one meeting with him)."

  After that, much is redacted. Click here to view.

   The Fed advised M&T that its application to buy Hudson would probably be protested -- accurately, given that Hudson City in 2011, for conventional home purchase loans in the New York City Metropolitan Statistical Area, to make 765 such loans to whites and only FIVE to African Americans.

  Of this, a Fed memo of August 24 said "this will require review of any issues that are raised and [REDACTED].

 To view, click on cover email, and talking points One and Two.

  After the August 17 contact but before the proposal was announced, the Fed met on August 22 from 4:30 to 5:30 with "Wilmers" and Rene Jones, Michael Pinto and outside council Rodgin Cohen.

  A slide presentation was made, much of which including on Due Diligence and Complexity has been withheld.

  After the meeting, the New York Fed's Ivan Hurwitz sent a memo to the Fed in Washington, most of which has been blacked out.

  On August 24, the Fed's John Ricketti wrote another memo, with talking points, about his meeting with Rodgin Cohen and Rene Jones, much of its redacted.

Then on August 27, Cohen [Rodge] called the Fed's Tom Baxter, and Wilmer called "Dudley," both summaries redacted.

After the deal was announced, M&T had more meetings with the Fed on September 7. Only after they submitted an application did Inner City Press submitted a FOIA request on October 2, and an initial protest, on October 7.

Now Inner City Press has timely requested a further extension of the comment period, to review the documents so belatedly released, and to appeal what is being withheld.

Withheld is the substantive part of "Confidential" Exhibit O, what M&T will actually PAY to Merger Sub, and nearly all of the anti-money laundering program, material changes and due diligence findings. The Board Resolutions and Agreement and Plan of Merger are all blacked out, which is ridiculous.

November 5, 2012

So why hasn't the Fed asked, or M&T answered, questions about its application to acquire Hudson City Savings Bank? We are waiting...

October 29, 2012

The Fed has yet to address its revolving door. The response from M&T's outside counsel to ICP's October 7 protest was signed by a former FRB staff attorney who worked on mergers, with those still there. With all due respect, how is this appropriate? ICP has asked. Watch this site.

October 22, 2012

So when push comes to shove, the Federal Reserve doesn't even enforce the HHI Index. In Madison, Indiana last week, the Fed approved: "On consummation of the proposed merger, the resulting institution would remain the largest insured depository institution in the market, controlling deposits of approximately $249.7 million, which would represent approximately 46.3 percent of the market deposits. The HHI would increase by 234 points to 3284."

It fails the stated test, but the Fed approved it...

October 15, 2012

On October 5, Trustmark wrote to the Federal Reserve and said is was extending the planned closing date of the merger into 2013, because it has rightfully not obtained regulatory approval. Trustmark's lawyers mailed Inner City Press a copy of their email to the Fed -- we'll put it online here -- and then four days after the email, put out a press release about the extension (but not the protest).

On October 11, after its press release and uninformed reports of it, Trustmark answered another round of questions from the Federal Reserve. But the Fed has yet to extend the comment period. Watch this site.

October 8, 2012

Ah, if only Bernanke would apply his baseball paean to Davey Johnson to CRA, and see fit to deny a merger on CRA grounds from time to time, not least to "help in the long run"...

October 1, 2012

On appeal, and only on appeal, the Fed through Governor Jay Powell has deigned to belatedly release Trustmark's market share of deposits in Jackson, Mississippi and basic information about its anti money laundering program. Why was it withheld? What accountability is there for that?

September 24, 2012

From the troubling department of the revolving door: "Patrick M. Parkinson, former director of supervision for the Federal Reserve board, has joined Promontory Financial Group. After 31 years at the central bank, he will serve as a managing director at Promontory, consulting on regulatory and risk management issues in Washington.As the director of banking supervision and regulation from 2009 to 2011."

This should not be permitted.

September 17, 2012

So after the Fed handed out an approval without any mention or consideration of it, now it's reported that BB&T will close 21 branches in South Florida as it swallows BankAtlantic -- nine from BB&T and 12 from BankAtlantic. And, 365 jobs will be cut by Feb. 1, 2013...

Meanwhile Fed Governor Jerome H. Powell, formerly of Deutsche Bank and the Carlyle Group, has belatedly ruled on Inner City Press' June 30 FOIA appeal about Mitsubishi UFJ, largely rubber stamping the withholding but saying that some additional pages mis-withheld under Exemption 8 will be released. But these wrongfully withheld pages weren't included with Powell's letter, and haven't been e-mailed.

The Fed did belatedly send a copy of its August 27 to Trustmark, after it was raised. Better late than never.

September 10, 2012

After Inner City Press / Fair Finance Watch commented on Trustmark's application to acquire BankTrust, its law firm Wachtell Lipton replied, saying that a six to one denial rate disparity was okay. Now the Federal Reserve has asked Trustmark and Wachtell Lipton questions about the reply, including about Somerville Bank & Trust, who reviewed and claimed no discrimination? The responses are not convincing - and one wonders why the Fed didn't send ICP a copy of the questions, when they were asked...

September 3, 2012

The House Financial Services Committee has given the NY Fed a one-month extension, from September 1, to hand over thousands of documents related to the interest rate manipulation scandal. Many mega-banks including Citigroup, JPMorgan Chase, Barclays, UBS, Bank of America and Royal Bank of Scotland Group have been under investigation from regulators around the world over colluding to manipulate LIBOR.

Meanwhile the Federal Reserve Board has tried to withhold from Inner City Press information about the LIBOR scandal and Mitsubishi UFJ -- but Inner City Press has appealed under the Freedom of Information Act....

August 27, 2012:

So what does Trustmark's law firm Wachtell, Lipton have to say about its lending disparities? That the Office of the Comptroller found them okay. But here they are, as raised on the pending application to acquire BankTrust:

in its headquarters Metropolitan Statistical Area of Jackson, Mississippli in 2010, Trustmark for conventional home purchase loans had a denial rate for African Americans more than SIX TIMES HIGHER than for whites: 44.7% denial rate for African Americans, versus 7.3% for whites. It had a 100% denial rate for these and refinance loans for Latinos.

  MEANWHILE, the Federal Reserve in an August 22 FOIA response blacks out even Trustmark's market share of deposits in Jackson -- clearly public information. The Fed has hit a new low.

August 20, 2012

   Based on troubling disparities in mortgage lending in the Deep South,ICP  Fair Finance Watch has filed Community Reinvestment Act comments with the Federal Reserve on Mississippi-based Trustmark's application to acquire Mobile, Alabama based BankTrust.

  In its headquarters Metropolitan Statistical Area of Jackson, Mississippli in 2010, Trustmark for conventional home purchase loans had a denial rate for African Americans more than SIX TIMES HIGHER than for whites: 44.7% denial rate for African Americans, versus 7.3% for whites. It had a 100% denial rate for these and refinance loans for Latinos.

  In the Gulfport - Biloxi MSA in 2010, for conventional home purchase loans Trustmark made 40 loans to whites and only four to African Americans.

  In the Memphis MSA in 2010, for conventional home purchase loans Trustmark made 34 loans to whites and only two to African Americans.

In the Houston MSA in 2010, for conventional home purchase loans Trustmark made 35 loans to whites and NONE to African Americans.

  ICP  Fair Finance Watch has requested an evidentiary hearing into these lending patterns. The Federal Reserve Bank of Atlanta has confirmed receipt and asked the Fed's Freedom of Information Act unit and more importantly Trustmark and its outside counsel for responses. Watch this site.


August 13, 2012

So what WAS the Federal Reserve System doing about Standard Chartered for all this time?

August 6, 2012

Ah, impunity. The Fed's BB&T - BankAtlantic order, issued days after Governor Jerome Powell withheld yet more information from ICP on FOIA appeal, notes its protest

"referenced an SEC lawsuit alleging that the chairman of BA Bancorp had engaged in a pattern of misleading BA Bancorp’s investors through selective and untimely disclosures with respect to problem loans. The individuals named in the lawsuit will not be associated with BB&T or BankAtlantic after consummation of the proposed transaction."

So after untold scandals and the financial meltdown, the Fed's response? "Bygones."

July 30, 2012

Federal Reserve Seems to Pre-Approve Mergers, BB&T FOIA Release to Inner City Press Shows

By Matthew Russell Lee, Exclusive

SOUTH BRONX, July 29 -- This month the Federal Reserve Board quietly announced a willingness to pre-approve, or to indicate a willingness to approve, bank mergers proposals even before the public is made aware of them.

  To some, this shows how little the regulator has learned from the financial meltdown.

  Inner City Press has also just learned, via a Freedom of Information Act request and appeal, that the Fed has even this year been entertaining bank merger proposals under code names such as "Project Palm," assigned to BB&T's proposal with BankAtlantic.

   Click here for Governer Jerome Powell's response to Inner City Press' FOIA Appeal. Click here for some of the documents released

   The deal is still pending.

  When the Fed on July 11 announced the policy by a "Supervisory Letter," its press release provided a telephone number in Washington for media inquiries. Inner City Press called the number and asked among other things how it would impact review under the Community Reinvestment Act, which involves public notice and comment.

  Inner City Press will not here report the name of the person answering, because it was insisted that no name could be given.

  Rather Inner City Press was directed to the FOIA footnote of the Supervisory Letter, that some records about the pre-approvals will be available, after the fact, under FOIA.

  But while the Fed is pre-approving, the public will have no way to know what records to request. This can be called false transparency.

  Even on BB&T's "Project Palm," it is only now that the Fed releases records half-showing its response to Inner City Press' February 2012 comment on and against the proposal.

  The just-released records show that on February 7, Claudia A. VonPervieux of Fed staff was "working on a draft rejection letter for M.Lee" of Inner City Press when the Fed belatedly realized that the Press was right: public notice had disappeared such that one couldn't know what to comment on.

   And so a brief extension of the comment period was granted, but only for Inner City Press, which did not cure the problem of lack of notice to the public at large. See released e-mails, attached. And so it goes at the Fed. Watch this site.

July 23, 2012

The Fed has done it again: improperly withheld basic information about an application, as admitted even by the pro-bank Governor now in charge of ruling on FOIA appeals. Governor Jay Powell, recently withholding ING - Capital One information, now finds on another application (BB&T) that information was improperly withheld under Exemption 5 and can now be released including records that "describe transaction filings and discuss comment period timings and news articles." The rest -- at least 156 full pages -- he withholds.

Meanwhile one of Governor Powell's ex employers has decided to hold onto its stake in a bank in Taiwan, Ta Chong. How does or will Powell recuse himself? Watch this site.

July 16, 2012

Last week, the Federal Reserve put out a letter offering "pre-filing" review of merger applications to banks. Inner City Press decided to call the number on the Fed's press release with a "media inquiry."

At first they said they'd give an on the record answer. Then they offered only "deep background" not attributable to the Fed -- and even then, only directed ICP to the FOIA part of the letter. This... is what lets scandals like LIBOR and predatory lending happen.

July 9, 2012

Just filed with the Fed:

This is a FOIA appeal to the Federal Reserve Board's "reconsideration" and partial denial, dated June 29, of my FOIA request of February 17 regarding BB&T's proposal to acquire BankAtlantic.

First, I note that I submitted an appeal -- now, rather than acknowledge the improper withholdings appealed from (and have that recorded for example in the FRB's annual FOIA report), the FRB decides to call it a "reconsideration," from which I now submit this second appeal. This record below must be addressed in the response to this (second) appeal.

The Associate Secretary's June 29 letter (the "Denial") outright withholds 53 pages, saying it's clear why. Again, it's not - this is an appeal of all those withholdings.

Why is the October 28, 2011 "update on Project Palm" being withheld? Also, information about the 12/02/2011 call, and the E-Apps notifications of 12/13/2011 and 12/16/2011, and the Thro to Seld e-mail of the latter date. Also the Cox to Smith e-mail of 01/25/2012.

ICP is explicitly challenging all withholdings concerning the extension of the comment period, including but not limited to the 02/06/2012 and 02/07/2012 emails.

July 2, 2012

The Federal Reserve's FOIA response to Inner City Press about the applications of Mitsubishi UFJ Financial Group, Inc., The Bank of Tokyo-Mitsubishi UFJ, Ltd and UnionBanCal Corporation to acquire Pacific Capital Bancorp & Santa Barbara Bank & Trust outright withholds 634 pages, and we have appealed.

But what's provided points to more. For example:

Subject: Unionbancal/Pacific Capital BC transaction - call Wed?
From: Elisa Johnson
To: Kenneth Binning; Cynthia Holbrook; Steven Takizawa Cc: Jose Alonso
Date: 02/21/2012 04:53 PM

Hello everyone -

I just took a call from Mark Gillett of Union Bank wanting to have a preliminary call tomorrow at 11am to discuss the filing requirements for Unionbancal's acquisition of Pacific Capital BC, Santa Barbara. Union is in the midst of conducting their due diligence . This will be an all cash transaction. FYI: the code name for this deal is Pebble Beach. The structure of the deal has "gelled"

But no earlier records are provided. And many records are withheld as "not responsive" -- with "also b(5)" added later in a different font. The Fed continues to abuse FOIA - we have appealed. Watch this site.

June 25, 2012

After Inner City Press / Fair Finance Watch challenged the applications of Mitsubishi UFJ Financial Group to acquire Pacific Capital Bancorp & Santa Barbara Bank & Trust, the applicants decided to withhold basic information about their Community Reinvestment Act programs.

Then Inner City Press filed Freedom of Information Act requests and appeals. Now, Mitsubishi related some information, while blacking out columns and columns, and most of its response on the CRA. Meanwhile, the Fed by letter dated June 18 says it is withholding 634 pages, but is providing other information, which we've yet to receive. We'll have more on this.

June 18, 2012

So the Federal Reserve, belatedly ruling on June 6 on Inner City Press / Fair Finance Watch FOIA request of February 17 regarding BB&T and BankAtlantic, says "156 full pages and portions of other pages (as will be apparent to you from the face of the documents to which redactions have been made) will be withheld from you." We aim to appeal - watch this site.

June 11, 2012

The Federal Reserve has issued a flurry of FOIA denials and extensions of time. Then comes a heavily redacted submission TO the Fed from Sullivan & Cromwell, on Mitsubishi UFJ Financial Group's application to buy Pacific Capital Bancorp and long time RALs rogue Santa Barbara Bank & Trust.

Asked about its due diligence on the RALs rogue, Sullivan & Cromwell say "see Confidential Exhibit 1" -- but do not provide it. Well, we DO want to see it. Watch this site.

June 4, 2012

The Federal Reserve Bank of San Francisco has confirmed receipt of the comments of Inner City Press / Fair Finance Watch. While the letter of Kenneth R. Binning of the FRBSF is dated May 9, it wasn't mailed until May 29. Maybe THIS is one of the reasons the Federal Reserve didn't stop the subprime meltdown...

May 29, 2012

Last week Inner City Press RSVP-ed for and went to cover a speech by the President of the Federal Reserve Bank of New York William Dudley. But from CFR's overflow run to which the media was confined, ICP was not able to ask any questions, whether about bank accounts for UN member states or why it is appropriate for JPMorgan Chase CEO to be on the Federal Reserve Bank of NY board of directors, given that the FRBNY directly regulated JPMC, which has recently gambled and lost $3 billion and counting. This last question, Inner City Press submitted twice by email, but it was not posed. Nor has it been answered since.

Months after the Federal Reserve approved the applications of Capital One and ING DIRECT, now the Fed admits it improperly withheld information in response to Freedom of Information Act requests and appeals by Inner City Press / Fair Finance Watch. A little late, isn't it? We need new regulators. Watch this site.

May 21, 2012

When the Federal Reserve approved on May 9 the applications to acquire 80% of Bank of East Asia, it did NOT require an application from or review the real party in interest: the Chinese government. Inner City Press / Fair Finance Watch raised the issue, this loophole created by the Fed, under which government's like the DPRK or Syria or Bahrain could acquire a bank in the US without any review of the risks created. The Fed merely cites the loophole it opened up itself (that governments are not companies -- an exception intended for US-based governments like states), then says that "Congress has provided other US agencies the authority to review national security issues in proposals by foreign companies to acquire US companies."

The Fed is missing, intentionally, the point: ownership of an insured bank by a foreign government that might even be subject to regime change by the US or its allies is a risk that the Fed must consider. Watch this site.

May 14, 2012

So sleazy Deutsche Bank, AFTER de-certifying with the Fed, now pays out a governmental settlement for predatory loans defrauding FHA. Wouldn't it seem like time for the Fed to reconsider that decertification?

May 7, 2012

As Deutsche Bank Evades Fed, Tarullo Alludes to "Some Private Actors," Blurs FOIA & Volcker Rulemaking

By Matthew Russell Lee

UNITED NATIONS, May 2 -- When the Federal Reserve's Daniel Tarullo spoke Wednesday at the Council on Foreign Relations about regulatory reform, he did not mention a single bank or financial institution.

  Inner City Press asked him about Deutsche Bank, which earlier this year split off its investment banking business so as to avoid Fed regulation. Tarullo on March 22 told the Senate the Fed would have to "respond" to this, that it had some impact on this thinking on regulation.

  Tarullo replied, "Matthew, what I said was it effected my thinking, not change, that implies a dramatic shift." Then he answered, six minutes in all, without once mentioning Deutsche Bank. He said that "the kind of changes some private actors are engaged in will have to effect the scope of our regulations."

  These regulations, he said, will be "under 165... to make sure we can implement Congressional concern."

  Inner City Press also asked Tarullo if he claimed the Fed has gotten more transparent since the financial meltdown, noting the Fed's recent denial in full of access to over 2000 pages responses to an Inner City Press FOIA request.

  Here now is an online copy of the Fed's FOIA denial

  Tarullo, which has previously heard of FOIA problems at the Fed, said he didn't know which FOIA request was referred to, then answered about administrative rule making. He said "for rule making, we get comments" and now distinguish "unique comments -- that is, not form letters."

He said there have been "17,000 Volcker Rule submissions... Absorbing all the comments is a substantial undertaking. If it takes longer to give due respect to comments," so be it.

  The FOIA request referred to was about Capital One's compliance, since the Fed's approval order on Capital One - ING DIRECT, including with Capital One's commitments to open branches and lend $180 billion" and about Capital One firing 490 assistant branch managers despite having made representations about increasing service.

  Amazingly, the Fed found 2200 pages responsive but provided not a single document, instead saying that "your request is denied in full," including as to each and every record "regarding with the Approval Order" of Capital One - ING DIRECT. ICP commented extensively on that application, as did NCRC, and the Fed's order cites the comments and Capital One's responses and representations. Now the Fed denies access to every record about compliance with the representations.

Inner City Press' request included a specific reference to branch closings, for example, which are not confidential. Additionally, information submitted and reviewed about compliance with Capital One's representations would contain HMDA data, which is public and not withholdable.

Even since the April 10 request, ICP on April 22 submitted to the Fed information about an admission by Capital One of fraud on consumers:

"Earnings power of HSBC card deal to drown out near-term noise, says Capital One CEO," April 19, 2012

Fairbank also reported a $75 million accrual for customer refunds stemming from what he described as 'instances in which phone sales people didn't adhere to our scripts and sales policy when cross-selling products to our credit card customers.' He said it is very important that Capital One ensures customers bought the unspecified products in the manner the company intended."

Just because it SOUNDS like the responsive records might include some withholdable information, it is outrageous to withheld each and every responsive record, citing the catch-all Exemption 8. The Fed is increasingly abusing and evading FOIA. Watch this site.

April 30, 2012

The Federal Reserve just continues to hit new lows, leading to this FOIA appeal by ICP:

This is an immediate FOIA appeal to the Federal Reserve Board's denial dated April 26, 2012 of my FOIA request of April 10, 2012 for "all records in the possession of the FRS concerning Capital One's compliance, since the FRB's approval order on Capital One - ING DIRECT, including with Capital One's commitments to open branches and lend $180 billion" and about Capital One firing 490 assistant branch managers despite having made representations about increasing service.

Amazingly, the Fed provides not a single document, instead saying that "your request is denied in full," including as to each and every record "regarding with the Approval Order" of Capital One - ING DIRECT. ICP commented extensively on that application, as did NCRC, and the Fed's order cites the comments and Capital One's responses and representations. Now the Fed denies access to every record about compliance with the representations. This is a new low.

Inner City Press' request included a specific reference to branch closings, for example, which are not confidential. Additionally, information submitted and reviewed about compliance with Capital One's representations would contain HMDA data, which is public and not withholdable.

Even since the April 10 request, ICP on April 22 submitted to the Fed information about an admission by Capital One of fraud on consumers:

"Earnings power of HSBC card deal to drown out near-term noise, says Capital One CEO," April 19, 2012

Fairbank also reported a $75 million accrual for customer refunds stemming from what he described as 'instances in which phone sales people didn't adhere to our scripts and sales policy when cross-selling products to our credit card customers.' He said it is very important that Capital One ensures customers bought the unspecified products in the manner the company intended."

Just because it SOUNDS like the responsive records might include some withholdable information, it is outrageous to withheld each and every responsive record, citing the catch-all Exemption 8. The Fed is increasingly abusing and evading FOIA and this must be not only reversed, but explained and accountability imposed in response to this appeal.

April 23, 2012

Who knew? The Federal Reserve, which barely enforces the Community Reinvestment Act in the US where it is the law, last week told a group of visitors from Central America that perhaps they could assist in rating banks' performance in countries outside the US. We'll see.

April 16, 2012

MetLife is one of the largest financial institutions in the world, but now it seeks to escape Federal Reserve regulation by selling its deposits to GE Capital Financial. Inner City Press / Fair Finance Watch has now opposed the transaction - watch this site.

April 9, 2012

The Fed has, so far, allowed BB&T to amend its application to acquire BankAtlantic, to tell ICP about its application late, and not yet to extend the comment period. ICP has complained:

This is a third comment on the applications by BB&T to acquire scandal-plagued BankAtlantic. BB&T has significantly amended the proposal after an adverse court ruling -- the changed structure should trigger a new public comment period.

Troublingly, while BB&T outside law firm Wachtell, Lipton send the amendments to the Fed on March 19 by courier, they were only sent to Inner City Press the follow (this) month. So Inner City Pres is requesting an extension of the comment period.

It would be ludicrous to argue that the changes to the proposal, the result of a court order, are not substantial. As such, it is unclear to ICP why no new public notice appears to have been published.

As described, BB&T would assume about $285 million of BankAtlantic Bancorp TruPS obligations in exchange for a 95% preferred interest in a newly established limited liability company, which will comprise about $423 million of loans and $17 million of other net assets. BB&T has estimated $350 million of recoverable preference value in the limited liability company. Once BB&T recovers $285 million in preference amount from the limited liability company, its interest in the company will terminate. BB&T would also have an incremental $35 million guarantee to assure BB&T's recovering within seven years of the $285 million preference amount.

ICP has recently obtained BB&T 2011 HMDA-LAR and will be commenting on its, in a week's time. The comment period must be extended.

April 2, 2012

  In the first study of the just-released 2011 mortgage lending data, Inner City Press and Bronx-based Fair Finance Watch have found that banking behemoths Citigroup, JPMorgan Chase and Wells Fargo continued with high cost loans and disparities by race and ethnicity in denials and higher-cost lending.

2011 is the eighth year in which the data distinguishes which loans are higher cost, over a federally-defined rate spread of 1.5 percent over Treasury bill yields.

The just released data show that Citigroup confined African Americans to higher-cost loans above this rate spread 3.38 times more frequently than whites in 2010, worse that its 2.25 disparity in 2009, Fair Finance Watch has found.

Citigroup confined Latinos to higher-cost loans above the rate spread 2.42 times more frequently than whites in 2010, worse that its 1.72 disparity in 2009, the data show.

Even after the bailouts, lending disparities grew worse and not better," said Fair Finance Watch. "Regulatory laxity, at least on fair lending, has continued despite the financial meltdown caused by predatory lending."

For JPMorgan Chase, the disparity for African Americans in 2011 was 2.21; for the largest of Wells Fargo's many HMDA data reporters, the disparity for African Americans in 2011 was 2.28.

"The Federal Reserve is becoming more and more bank-friendly, including with the recent nomination of former hedge funder and Deutsche Bank official Jay Powell for a seat on the Federal Reserve Board. It is still not clear if the new Consumer Financial Protection Bureau will get to this problem," Fair Finance Watch continued. "The disparities in the 2011 mortgage data of these banks further militate for aggressively watchdogging and breaking up these banks."

Growing Southern bank BB&T, even absent its subprime unit Lendmark, in 2011 confined African Americans to higher-cost loans above the rate spread 2.59 times more frequently than whites

Fair Finance Watch has continued its enforcement project in the South, most recently raising issues under the Community Reinvestment Act on BB&T's proposal to acquire BankAtlantic. In response, the Federal Reserve Board extended the comment period. Much of BB&T's application has been blacked out or withheld in full, which Inner City Press is challenging under the Freedom of Information Act.

Inner City Press & FFW have also joined others concerned with Deutsche Bank's decertification as a financial services holding company to escape Dodd Frank including its capital adequacy rules -- particularly given Deutsche Bank's role in the subprime scandal, as lender, securitizer and now major forecloser.

The law required that the 2011 data be provided by March 31, following March 1 joint requests by Fair Finance Watch and Inner City Press. Several banks did not provide their data by the deadline, most notably Capital One and Bank of America, despite confirming receipt of the request. Further studies will follow: watch this site.

March 26, 2012

Deutsche Bank was big into subprime, as lender, securitizing and foreclosing trustee. But now that the Dodd-Frank law is coming into effect, Deutsche Bank is restructuring to avoid the law's requirements. Fed Governor Tarullo has said this gives pause. And what will he and the Fed do?

March 19, 2012

So the FRB stiffly and belated went on Twitter and was greeted by... the CFPB, already there.

March 12, 2012

"The Federal Reserve is reportedly stalling some banks' proposals to pay dividends and repurchase shares, after it determined that the firms are miscalculating the potential losses on consumer debt in an event of a financial crisis." A little late, isn't it?

March 5, 2012

On the Volcker Rule, Fed board members and staff members met with JPMorgan Chase 16 times, Bank of America 10 times, Goldman Sachs 9 times, Barclays 9 times & Morgan Stanley 9 times -- what about Citigroup?

Even as requests for reconsideration of Capital One - ING DIRECT pend at the Federal Reserve, in Europe, the terms of ING’s bailout by the Dutch government are being questioned by a European Union court in the first case challenging EU conditions on more than $1.3 trillion of bank rescues throughout the region. ING was ordered by the European Commission to sell units to shrink its balance sheet by 45 percent by the end of 2013 and avoid undercutting rivals on prices for some banking products for three years or until it repaid the aid. The EU must approve large state subsidies and can impose conditions on the aid. There have beeen challenges by ING and the Dutch government to the terms of the EU’s approval, which the bank says punished it too harshly for state help in 2008 and 2009. ING said the regulator miscalculated the amount of aid and imposed excessive restructuring demands. We'll see.

February 27, 2012

ICP has now requested reconsideration, following the Federal Reserve Board's February 14 approval of the proposed acquisition by Capital One Financial Corporation (“Capital One”) to acquire ING Bank, FSB and its affiliates (“ING”), to form what would be the fifth largest bank in the country.

One of the FRB's sleights of hand is in footnote 27, where after reciting ICP's objections the FRB says "the Board has determined in a separate action that ING Groep would not control Capital One as a result of this proposal. See Board letter to Mark Menting, Esq. (February 14, 2012)."

So a major contested issue was confined to a side letter on the same day at the approval. Amazingly, the Board has yet to provide even a copy of this letter to ICP, which commented extensively on this part of the proposal, including on ING being under investigation for violating sanctions.

While the Order says the charges are against ING, not ING Direct, in the side letter the Board was addressing ING owning a substantial percentage of Capital One. This segmentation is the type of legal legeredemain by which the FRB allowed the financial meltdown. This Order should be reconsidered, including in light of Capital One's dramatic drop in mortgage lending and did not adequately explain its findings - for example, the FRB asserts that Capital One’s credit card small business lending is minimal in contrast to findings by NCRC and others.

Footnote 10 of the FRB's approval order says

"One commenter expressed concern about ex parte communications and the opportunity for the public to rebut all information that was provided by Capital One. On review, the Board found that the public had a full opportunity to provide the Board with any information related to the factors that the Board must consider in acting on the notice. The information submitted by Capital One, and the release of that information to the public, was in accordance with the Board’s regulations and policies. The Board confirmed that all contacts between Capital One and staff were in accordance with the Board’s rules on ex parte communications."

The FRB should void and reconsider its Order, inter alia following its now appealed under the Freedom of Information Act denial of February 7, 2011 -- emailed to ICP after 5 pm on Feb 7 -- of ICP's FOIA request of October 29, 2011. This document dump was and is beneath the Federal Reserve.

Among the 1040 pages provided (more than 200 have been withheld in full), some show an irregular process tainted by ex parte communications and a disturbingly pervasive resolving door. Some examples, from a single one of the files dumped on ICP on February 7:

Former Federal Reserve legal staffer Andy Navarrete, now Senior Vice President of Capital One, improperly reached out to Scott Alvarez on August 25, 2011;

On November 7, 2011, PARobinson [a] wlrk.com – Patricia A. Robinson, presumably the always cordial Pat Robinson who was in the Federal Reserve Board’s Legal Division working on applications -- wrote to michael.sexton [a] frb.gov and stanlyn.clark [a] frb.gov

"It was great talking to you last week, Mike. Stanlyn, I am sorry that I missed you but hope to catch up very soon (now that my one-year 'cooling off' period has expired).

With all due respect to Ms. Robinson, it is troubling that Capital One could hire and use an attorney who personally knows and worked with all of the Fed attorneys reviewing the application. This led to a November 21, 2011, call about, among other things, the HSBC credit card portfolio, with 3 OCC officials on the call -- tainting that process as well. On November 18, 2011, Ms. Robinson was at the OCC, 8:45 to 10:45 AM. There was another call on December 9, 2011.

As noted in ICP's Feb 7 FOIA appeal, as simply one example, the Fed held ex parte communications with Capital One on November 21, writing a memo ostensibly as a tip of the hat to the rules against ex parte communications. Then the Fed withhold the summary under Exemption 4.

The Fed has even made withholdings from its own August 29, 2011 questions to Capital One. This is an outrage and has been appealed from.

The Fed is increasingly abusing and evading FOIA and this must be not only reversed, but explained and accountability imposed in connection with this request for reconsideration.

February 20, 2012

Fed Approves Capital One - ING After Delay & Data Dump, Reconsideration?

By Matthew R. Lee

SOUTH BRONX, February 14, updated -- Some Valentine: the day after the Federal Reserve for the second time postponed decision on the Capital One - ING bank merger, a Fed legal staffer called Inner City Press at 5:15 pm on Valentine's Day to say the deal was approved, but not in the normal way.

Inner City Press asked for an explanation of the February 8 postponement, and the February 13 deferral of decision, but none was provided. Reconsideration will be requested.

  One of the Fed's sleights of hand is in footnote 27, where after reciting Inner City Press' objections the Fed says "the Board has determined in a separate action that ING Groep would not control Capital One as a result of this proposal. See Board letter to Mark Menting, Esq. (February 14, 2012)."

  So a major contest issue was confined to a side letter on the same day at the approval. Footnote 10 of the Fed's approval order says

"One commenter expressed concern about ex parte communications and the opportunity for the public to rebut all information that was provided by Capital One. On review, the Board found that the public had a full opportunity to provide the Board with any information related to the factors that the Board must consider in acting on the notice. The information submitted by Capital One, and the release of that information to the public, was in accordance with the Board’s regulations and policies. The Board confirmed that all contacts between Capital One and staff were in accordance with the Board’s rules on ex parte communications."

   Consider: on the night of February 7, the Fed issued a document dump of some 1040 pages responding to a Freedom of Information Act request Inner City Press filed in October.

   Among the 1040 pages provided (more than 200 have been withheld in full, from ICP and other commenters, NCRC and others), some show an irregular process tainted by ex parte communications and a disturbingly pervasive resolving door. Some examples, from a single one of the files dumped on ICP on February 7, and which ICP commented on to the Fed in the run-up to its February 13 meeting:

Former Federal Reserve legal staffer Andy Navarrete, now Senior Vice President of Capital One, improperly reached out to Scott Alvarez on August 25, 2011;

On November 7, 2011, Patricia A. Robinson at Capital One's law firm – presumably the same Pat Robinson who was in the Federal Reserve Board’s Legal Division working on applications -- wrote to Michael Sexton and Stanlyn Clark at the Federal Reserve:

"It was great talking to you last week, Mike. Stanlyn, I am sorry that I missed you but hope to catch up very soon (now that my one-year 'cooling off' period has expired).

As ICP commented, it is troubling that Capital One could hire and use an attorney who personally knows and worked with all of the Fed attorneys reviewing the application. This led to a November 21, 2011, call about, among other things, the HSBC credit card portfolio, with 3 OCC officials on the call -- tainting that process as well. On November 18, 2011, Ms. Robinson was at the OCC, 8:45 to 10:45 AM. There was another call on December 9, 2011.

The Fed is increasingly abusing and evading FOIA and this must be not only reversed, but explained and accountability imposed in response to ICP's pending appeal.

For the reasons of record, and as argued by NCRC, the Federal Reserve should reconsider the ING approval...

February 13, 2012

Why did the Federal Reserve postpone its meeting on Capital One - ING from Wednesday afternoon for five days until Monday, February 13? Capital One's spokeswoman said “The board has informed us that the planned meeting for this afternoon has been rescheduled for Monday, February 13th. We understand that the delay is due to a scheduling conflict, and we look forward to their decision early next week."

But there's a problem with this spin, that scheduling made it impossible. At 3:05 pm on Wednesday, Inner City Press got a voice mail from the Federal Reserve's Legal Division, Michael Waldron, about an application that ICP Fair Finance Watch had commented on some time ago: Hawa - Korea Exchange Bank. The Board had just approved the application, Waldron said (without also stating any right to request reconsideration.)

In that Order Inner City Press / Fair Finance Watch is, yes, "the commenter."

So if the Fed could approve applications on Wednesday afternoon but chose not to do so for Capital One, why not?

One can hope that the outrageous "document dump" of hundreds of pages on the eve of the Fed's scheduled February 8 meeting, which Inner City Press immediately raised to the highest levels of the Fed, combined with calls Wednesday from NCRC members to open the meeting, caught the Fed's attention.

Then this should, too: Inner City Press, reviewing the documents dumped, has now commented to the Fed that

Among the 1040 pages provided (more than 200 have been withheld in full), some show an irregular process tainted by ex parte communications and a disturbingly pervasive resolving door. Some examples, from a single one of the files dumped on ICP on February 7:

Former Federal Reserve legal staffer Andy Navarrete, now Senior Vice President of Capital One, improperly reached out to Scott Alvarez on August 25, 2011;

On November 7, 2011, PARobinson [a] wlrk.com – Patricia A. Robinson, presumably the always cordial Pat Robinson who was in the Federal Reserve Board’s Legal Division working on applications -- wrote to michael.sexton [a] frb.gov and stanlyn.clark [a] frb.gov

"It was great talking to you last week, Mike. Stanlyn, I am sorry that I missed you but hope to catch up very soon (now that my one-year 'cooling off' period has expired).

With all due respect to Ms. Robinson, it is troubling that Capital One could hire and use an attorney who personally knows and worked with all of the Fed attorneys reviewing the application. This led to a November 21, 2011, call about, among other things, the HSBC credit card portfolio, with 3 OCC officials on the call -- tainting that process as well. On November 18, 2011, Ms. Robinson was at the OCC, 8:45 to 10:45 AM. There was another call on December 9, 2011...

The Fed is increasingly abusing and evading FOIA and this must be not only reversed, but explained and accountability imposed in response to this appeal.

This information must be reviewed, and released and comment allowed thereon, by ICP, NCRC and others, before the Fed considers approving the Capital One - ING proposals.


February 6, 2012

The fight on Capital One - ING continues, as more and more information is withheld. Inner City Press filed this FOIA appeal on February 4:

This is a timely FOIA appeal to the Federal Reserve Board's denial of February 3, 2012 of my FOIA request of January 6, 2012, for all of Capital One's January 3, 2012 submission to the Fed, etc..

The Fed has provide a document with redactions which ICP is hereby appealing. From Capital One's response to the Fed's December 15, 2011 questions, the Fed has blacked out the entirety of Footnote 1, which seemingly explains Capital One's lending in California.

The Fed has blacked out on the top of Page 6 some Capital One argument about how and why it will improve the fairness of its lending.

On Pages 11 and 12, Capital One makes representations to the Fed about with whom it will partner, representations clearly meant to argue for approval of Capital One's applications - but Capital One, and now the Fed, withheld the names and the argument. ICP is appealing.

The bottom of Page 16 is entirely redacted; there is no way to know what type of information it contains, and ICP appeals from the invocation of Exemption 8 (bank supervision) and Exemption 4, including the many redactions from the Exhibits to Capital One's submission.

The Fed is increasingly abusing and evading FOIA and this must be not only reversed, but explained and accountability imposed in response to this appeal.

This information must be reviewed, and released and comment allowed there, before the Fed considers approving the Capital One - ING proposals, protested by NCRC, ICP and others

January 30, 2012

Fifty days after Inner City Press filed a Freedom of Information Act request for Capital One's withholdings from its November 15, 2011 submission to the Federal Reserve, the Fed responded to ICP: withholding 590 pages in full, and providing to ICP and other commenters a mostly redacted 34 page document.

ICP has nearly immediately appealed, and commented to the Fed:

This is a sixteenth comment from Inner City Press / Fair Finance Watch ("ICP") opposing the proposed acquisition by Capital One Financial Corporation (“Capital One”) to acquire ING Bank, FSB and its affiliates (“ING”), to form what would be the fifth largest bank in the country.

The Federal Reserve should re-open its comment period, inter alia following its now appealed under the Freedom of Information Act denial of January 24, 2012 of ICP's FOIA request of December 4, 2011, for "all withheld portions of Capital One's November 15, 2011 submission to the Fed on the pending ING DIRECT application."

It took 50 days for the Fed to respond. Worse, 590 pages are being withheld in full, and of the single 35 page document subsequently sent to Inner City Press -- this appeal is timely -- much has been redacted, including how Capital One would pay for the acquisition,

weaknesses in ING DIRECT (page 3);

all information about Capital One's credit card lending to people with FICO scores below 660, and subprime card lending (page 4);

small business lending (page 5);

due diligence on HSBC's card platform, previously of the predatory lender Household (page 13);

forward sale agreements (page 14 - even the Fed's question is withheld, we appeal that);

mortgage lending (page 16); swaps (page17);

and the entirety of pages 19 through 34, including the Fed's questions. This is outrageous.

The Fed cites Exemption 5, but it how an "intra-agency" exemption could be cited for what Capital One submitted is unclear. ICP opposes the invocation, too, of exemption 8 without explaining in detail the type of information in the 590 pages withheld in full. It is hard or impossible to argue about this black hole of information: the Governor charged with ruling on this appeal should review all of the information in camera, and release all portions that are not strictly exempt.

The Fed is increasingly abusing and evading FOIA and this must be not only reversed, but explained and accountability imposed in response to this appeal.

This information must be reviewed, and released and comment allowed there, before the Fed considers approving the Capital One - ING proposals.

For the reasons of record, and as argued by NCRC, the Federal Reserve should re-open the comment period to fully consider Capital One's related proposal to buy the ex-Household predatory lending platform from HSBC, and the related stealth ING proposals.

January 23, 2012

When in September the Federal Reserve held a public meeting on Capital One - ING in Chicago, Fed legal division official Ms. Thro replied, on camera, to Inner City Press / Fair Finance Watch's comments by saying ICP should submit a Freedom of Information Act request. ICP immediately did.

Among other things, ING is reportedly under investigation for violating sanctions, on Sudan, Iran and other elsewhere - topics which deserve a public airing before ING is considered to be allowed to own 9.9% of what would become the fifth largest US financial institution.

Inner City Press returned a telephone call to another Fed Legal Division staffer and voluntarily narrowed its FOIA request, for specific adverse ING information such as the above. The Fed identified responsive information but forwarded the request to the OCC, they say on December 20.

Now, more than three months later, the information is withheld in full by OCC denial on Friday. The OCC's denial does not provide a speck of information, does not give any idea of what is being withheld, and does not even state how many pages are being withheld.

There is no way to assess the propriety of these withholdings in full, ostensibly under Exemption 4. ICP has immediately appealed the withholding(s).

This information about ING must be reviewed, and released and comment allowed there, before the Fed considers approving the Capital One - ING proposals.

For the reasons of record, and as argued by NCRC, the Federal Reserve should re-open the comment period to fully consider Capital One's related proposal to buy the ex-Household predatory lending platform from HSBC, and the related stealth ING proposals.

January 16, 2012

  Responding to the Federal Reserve to allegations that Capital One violates bankruptcy laws, COF's law firm Wachtell, Lipton, Rosen & Katz in a January 11 submission wroted that it "was unaware of the debtor's bankruptcy because [REDACTION, Pages 3 - 4]." Inner City Press on January 14 challenged this redaction under the Freedom of Information Act, sating that as before and on the still pending requests, all information not clearly entitled to confidential treatment under the narrowest reading of the exemptions should be provided before any decision to approve, even conditionally, COF's applications to acquire ING DIRECT, protected by ICP, NCRC and others.

* * *

  It is argued that Obama "had" to nominate a Deutsche Bank and Carlyle Group hedge fund insider, Jay Powell, to the Federal Reserve as a condition of getting a Democrat also confirmed.

  Meanwhile Democratic representatives are urging Obama to offer a recess appointment for a new head of the Federal Housing Finance Agency. Twenty eight congressmembers from California signed a January 10 letter, which argued that Obama should use the same legal justification for appointing a new director at the agency that he applied to Cordray and the CFPB.

"As the fiduciary of government-backed entities, there are steps that the FHFA can take to help prevent foreclosures while also protecting taxpayers," they wrote. "Installing a permanent Director of the FHFA will allow the FHFA to move forward to make key decisions that will help keep families in their homes and improve our economy."

  Some wonder why this logic isn't applied to the Federal Reserve Board, where Obama supporters argue that he "had" to nominate a hedge fund insider Jay Powell in order to get any confirmation.

  The Fed is reportedly preparing to rubber stamp Capital One's application to acquire ING DIRECT, protested by NCRC, Fair Finance Watch and others, even as Capital One's lawyers try to withhold the most substantial portions of their responses to the Fed, including on Capital One's related application to the Office of the Comptroller of the Currency to buy from HSBC the subprime credit card platform of the former Household International, charged with nationside predatory lending. Why?

January 9, 2012

In remarks following a speech in Chicago, St. Louis Federal Reserve Bank President James Bullard called it unlikely that the central bank will need to buy more bonds to stimulate the economy, in view of recent data on holiday sales and labor market conditions. Bullard also repeated support for an explicit inflation target, which is expected to be a subject of the Fed's meeting later this month.

Capital One put in another submission to the Federal Reserve on its ING DIRECT application -- but then withheld large parts of it as sent to Inner City Press and other commenters. ICP has challenged under the Freedom of Information Act, and submitted the below to the Fed:

The Federal Reserve should re-open its comment period, inter alia following improper withholdings, now challenged under the Freedom of Information Act, from Capital One's (COF's) submissions to the Federal Reserve System dated January 3, 2012, with those improperly redacted by COF's law firm Wachtell, Lipton, Rosen & Katz.

All redacted information should be reviewed and provided before any decision to approve, even conditionally, COF's applications to acquire ING DIRECT. We refer most pressingly to the redacted response to the FRS' December 16 questions, sent to us by email on January 6 by WLRK under cover lever dated January 3, 2012.

COF is required to send us their submission under the FRS' ex parte rules, but has sent us significantly redacted versions.

Under the headings “Mortgage Lending," "Community Development Lending," "Other Lending" and the like, COF makes claims about policies and loans made and then redacts line after line. This also takes place when COF is asked in 1d about its lending geographically: contrary to the spirit and letter of CRA, geographical identifiers are redacted, even footnotes. We challenge each and every one of these absurd redactions, as well as the withholding of purported confidential exhibits 1, 2 and 3.

This should be treated as a FOIA appeal but was submitted through the FRS' FOIA form on January 6 to gain expedited treatment. All information not clearly entitled to confidential treatment under the narrowest reading of the exemptions should be provided before any decision to approve, even conditionally, COF's applications to acquire ING DIRECT.

Even as redacted, the submission make clear that Capital One's ING proposal is related to its proposal to buy the HSBC (ex-Household) credit card platform. HSBC put out a press release bragging about accounts renewed that would to go to Capital One: even regarding this, there are issues. For inclusion in the record: http://big-lots.pissedconsumer.com/lied-to-by-racist-big-lots-worker-20080308114996.html

For the reasons of record, and as argued by NCRC, the Federal Reserve should re-open the comment period to fully consider Capital One's related proposal to buy the ex-Household predatory lending platform from HSBC, and the related stealth ING proposals.

December 26, 2011

Bank of America & Federal Reserve Let Off Hook by DOJ Settlement, As BofA Bluewashed by UN

By Matthew R. Lee

SOUTH BRONX, December 22 -- The $335 million "Countrywide" fair lending settlement, as announced by the Department of Justice on December 21, went out of its way to let off the hook Bank of America and its regulator the Federal Reserve Board.

  The paper of record, without further comment, reported that the settlement was based on a referral by the Federal Reserve, covering a period before Bank of America owned Countrywide.

  But more than three years ago, over the detailed objections of Bronx-based Fair Finance Watch and others, the Federal Reserve allowed Bank of America to buy Countrywide and continue to run its predatory programs, which were slowed only by the subprime financial meltdown.

  Fair Finance Watch found, and Inner City Press reported, that "in 2006, at Countrywide and its higher-cost Full Spectrum, upper income African Americans were confined to higher cost loans over the rate spread 1.92 times more frequently than whites. In 2006, 24.70% of Countrywide's total mortgages were subprime.

  "In 2007, Countrywide Financial, which Bank of America had applied to buy, confined African Americans to higher-cost loans 1.95 times more frequently than whites, and denied the applications of Latinos 1.53 times more frequently than whites."

  The Federal Reserve approved Bank of America's acquisition of Countrywide without any conditions, despite this testimony. The disparities continues at Bank of America after the acquisition, without any action by the Fed.

  Years later comes a settlement that is, in context, a pittance, a smoke screen for a company which has received far more in government bailouts. For shame.

Footnote: Bank of America is also engaged in "blue washing," getting its chairman Charles Holliday named the co-chair of UN Secretary General Ban Ki-moon's High Level Panel on Sustainable Energy for All, despite B of A being protested as the number one funder of mountain top removeal coal mining. Now that B of A has settled charges of racial discrimination, will the UN take note?

* * *

As the Federal Reserve (and OCC, which will be a separate story) try to shield the Capital One - ING - HSBC deals, Inner City Press / Fair Finance Watch has submitted to the Fed a FOIA appeal of the Fed's FOIA denial the the FOIA request of September 28, which stated:

This is a request under FOIA for the entirety of ING's request for a non-control determination to own up to 9.9% of Capital One, and all records reflecting any FRS communications regarding the request or ING from January 1, 2011 to the date of your final response to this request.


Background: at yesterday's public meeting in Chicago on Capital One - ING DIRECT, Ms. Thro of the Legal Division commented on Inner City Press' testimony, that ICP "can file a FOIA request" for ING's request. This is that request, and for communications, and response should be expedited before October 12, or Capital One - ING DIRECT comment period should be extended. Thank you.

Despite Ms. Thro's public comment about the ability to file a FOIA request and implication what one would thereby receive the requested documents, on a timely basis, it took two and a half months for the Fed to respond. This constructive denial should be explained and acted on in response to this appeal.

Worse, among the documents subsequently sent to Inner City Press nearly everything is redacted.

Of the August 15 submission by Sullivan & Cromwel (S&C), the letter requesting confidential treatment is provide: but the entirety of the referenced "Annex A" is withheld.

The denial letter claimed that "the nature and amount of information being withheld will be evident from the face of the documents being provided." This is not true, and should be reversed, explained and acted on in connection with this appeal.

From the September 29 S&C cover letter, the area under Mark Menting's signature is blacked out, with the notation "N/R." Since ICP requested "all" documents, it is absurd to call this portion of the submission, whatever it is, "non responsive." If it is the people who the letter is cc-ed to, the Fed has hit a new low that must be reversed, explained and acted on in connection with this appeal.

Also, the entirely of the September 29 Annex A, including its footnote, is redacted.

Getting even worse, of the November 18 submissions, even a portion of the request for confidential treatment is redacted, as well as the entire annex.

Of the November 23 submission, two and a half paragraphs of S&C's letter to Ms. Thro are redacted - each and every redaction is hereby being appealed, including again the absurd blacking out of the area under Mr. Menting's signature.

From the November 29 submission, the blacked out "N/R" is on a separate page. It is absurd to claim, in respo