Federal Government has Exclusive Authority to Regulate National Banks, U.S. Chamber Argues to Supreme Court

Congress gave expert federal agency, not state attorneys general, regulatory authority

WASHINGTON, D.C.—Today, the U.S. Chamber of Commerce filed an amicus curiae brief with the U.S. Supreme Court challenging a claim by New York Attorney General Andrew Cuomo that he has authority to enforce state fair lending laws against federally-chartered banks. The case is Cuomo v. The Clearinghouse Association, LLC.

"The circuit court relied on well-settled legal principles to hold that the federal Office of the Comptroller of the Currency (OCC), not state attorneys general, have the exclusive authority to regulate federally chartered banks," said Robin Conrad, executive vice president of the National Chamber Litigation Center, the Chamber's public policy law firm. "Now, Attorney General Cuomo wants a special rule that would give him the regulatory authority Congress reserved for the OCC."

Attorney General Cuomo sought to enforce New York's fair lending laws against banks chartered by the federal government. In response, the OCC challenged the Attorney General's attempt to concurrently regulate national banks. By the explicit terms of the National Bank Act, federally chartered banks are subject to the exclusive 'visitorial,' or regulatory, authority of the OCC. According to the OCC's interpretation of the statute, the agency's visitorial authority encompasses the enforcement of state law as well as federal law. The New York Attorney General now wants the U.S. Supreme Court to overturn a decision by the U.S. Court of Appeals for the Second Circuit that agreed that the OCC's regulation of state laws against national banks preempted, or trumped, the Attorney General's investigation into the banks' lending practice.

"Since Congress enacted the National Bank Act over 140 years ago, courts have time and again affirmed the authority of the federal government, not the states, to regulate nationally chartered banks," said Conrad. "Now is not the time to experiment with a patchwork of 50 new layers of state-based regulation."

NCLC is the public policy law firm of the U.S. Chamber of Commerce that advocates fair treatment of business in the courts and before regulatory agencies.

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

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