Thursday, April 09, 2009
Elena Kagan
Consumer and civil rights groups are beside themselves over a decision by the Justice Department to pick up where the Bush administration left off in defending banks accused of having racist lending practices. Later this month, President Barack Obama’s choice for solicitor general, Elena Kagan, will go before the US Supreme Court to argue in Cuomo v. The Clearing House Association that state governments have no jurisdiction when it comes to obtaining the financial records of institutions such as Bank of America, Citibank, Wells Fargo, and JPMorgan Chase to determine if their policies are race-based.
The investigation was first launched by New York Attorney General Elliot Spitzer in 2005, after discovering that many banks operating in his state were issuing a disproportionate number of high-interest loans to African-Americans and Hispanics. After initially asking for banks to turn over their records, the state of New York found itself being sued by the institutions, which argued that only the federal Office of the Comptroller of the Currency (OCC) could make such a request. The OCC, which is supposed to be a watchdog for the banking industry, joined the lawsuit on behalf of the banks.
-Noel Brinkerhoff
Obama Sides With Banks Accused of Racism (by Stephanie Mencimer, Mother Jones)
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