Lawyers' Committee for Civil Rights Under Law
1401 New York Avenue, NW
Suite 400
Washington, DC 20005

For Immediate Release
Contact: Jonathan P. Hooks
202-662-8326
August 5, 2005

Civil Rights Groups Defend New York State's Authority to Conduct Fair Lending Enforcement
Amicus Brief Supports Bid to Investigate Discriminatory Lending Practices

NEW YORK, NY – Today, six major national civil rights and advocacy groups joined ten New York organizations dedicated to fighting discriminatory lending practices to defend the authority of New York’s Attorney General to enforce state fair lending laws. The groups, which include the National Community Reinvestment Coalition, the National Fair Housing Alliance, the Center for Responsible Lending, AARP, and the NAACP Legal Defense and Education Fund, Inc., filed a brief amicus curiae in a case which seeks to halt efforts by the New York Attorney General’s office to investigate discriminatory lending practices by national banks and their subsidiaries.

After recent Home Mortgage Disclosure Act (“HMDA”) data revealed that African-American customers were 1.5 to 3 times more likely than whites to receive high-cost loans at several national banks, the Attorney General sought additional data to investigate the banks’ claims that the higher rates were due to non-discriminatory credit rating factors. To halt the investigation, the Clearing House Association, L.L.C., an organization of commercial banks, and the federal agency regulating national banks, the Office of the Comptroller of the Currency (“OCC”), sued Attorney General Spitzer, claiming that the National Bank Act prohibited any state enforcement and investigation of national banks or their subsidiaries. The OCC’s claim that only it may investigate or enforce even state anti-discrimination laws against national banks – what the OCC terms exclusive “visitorial” powers – was recently made in a 2004 OCC regulation that was sharply objected to by civil rights and advocacy groups as well as the National Association of Attorneys General.

In their amicus brief, the groups, represented by the Lawyers’ Committee for Civil Rights Under Law and others, explained the ongoing, serious problem of discriminatory and predatory lending – and emphasized the growth of discrimination in recent years due to the explosion of high-cost subprime lending. In many New York communities of color – as across the country – mainstream prime loans are not widely available. As a result, high-cost subprime mortgage loans are the primary source of credit. These higher cost loans can not only be discriminatory, but are also related to dramatic increases in foreclosure rates in many communities over the past decade.

“Lending discrimination is a growing crisis in our country, especially in minority communities where traditional prime credit isn’t widely available and high-cost and unscrupulous lenders take advantage,” said Barbara Arnwine, Executive Director of the Lawyers’ Committee for Civil Rights Under Law, the national civil rights organization which joined others in drafting the brief. “As the Fair Housing Act makes clear, states are to play a central role in protecting their citizens from these kinds of discriminatory practices. The federal government should be in the business of supporting investigations to root out discrimination, not trying to shut them down.”

In addition to explaining the need for increased predatory lending enforcement, the brief explains why the OCC’s attempt to make itself the exclusive authority to enforce fair lending laws against national banks and their subsidiaries runs contrary to the National Bank Act and the Fair Housing Act.

The Lawyers’ Committee is an over forty-year old nonpartisan, nonprofit civil rights legal organization, formed in 1963 at the request of President John F. Kennedy to provide legal services to address racial discrimination.

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