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FDIC Federal Register Citations

Empire Justice Center

December 13, 2005

VIA E-MAIL: comments@fdic.gov
Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street NW
Washington, D.C. 20429

Dear Mr. Feldman:

I write on behalf of the Empire Justice Center, a non-profit legal services organization in New York State, in support of the comments submitted by the National Consumer Law Center (NCLC) regarding interstate banking, federal interstate rate authority and proposed rulemaking. The proposal would preempt banks in New York from some of our most important consumer protection laws without providing equal protections for our citizens on the federal level.

Empire Justice is a statewide, multi-issue, multi-strategy non-profit law firm focused on changing the “systems” within which poor and low-income families live. We represent and advocate on behalf of individuals in a number of areas including civil rights, public benefits, health law, domestic violence and consumer law. Our Consumer Housing and Community Development (CHCD) unit represents victims of predatory lending, deed theft scams, unfair debt collection, automobile financing fraud, among other things. The CHCD unit works closely with state legislators and regulators such as the New York State Banking Department and the Office of the Attorney General to not only maintain the status quo of consumer protections within our state, but to provide greater protections for our citizens, as well. We were very involved in getting New York’s anti-predatory lending law passed and vigorously defend state regulations regarding bounce protection and overdraft fees, and interest rate caps on small loans.

Your proposal puts at risk many of the consumer protections New Yorkers currently are afforded. The sad reality is that individual consumers do not enjoy many protections as it is in towards financial world. The federal government over the past 10-20 years has slowly chipped away at protections that once put consumers on better footing before the lending and banking industry. It is in the best interests of all of us – except the bank investors – to fight hard to maintain the consumer protections that still rightfully exist.

In addition, we agree with NCLC’s challenge that the proposal is not only improvident, but likely beyond the FDIC’s authority. State bank operating subsidiaries, agents of the banks, or other third parties should not be entitled to interest rate preemption.

Should the proposal be adopted, the FDIC would be joining what can best be described as a great “race to the bottom,” a phrase that has become clichéd, unfortunately, when discussing consumer rights in the context of banking and lending.

Again, we support NCLC’s comment and urge the FDIC not to move forward with the proposal.

Sincerely,

Kirsten E. Keefe


 


Last Updated 12/15/2005 Regs@fdic.gov

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