NEW YORK (CN) - Former New York Attorney General Eliot Spitzer lost a turf war with the federal government in a 2nd Circuit ruling that upheld an administrative regulation prohibiting states from trying to enforce federal banking laws.
In 2005, Spitzer's office began investigating national banks for discriminatory mortgage lending policies. The Office of the Comptroller of the Currency, a federal agency that oversees banks, issued a regulation expanding the National Bank Act's limit on "visitorial powers" over banks. The OCC decided that states cannot investigate or enforce federal laws that address activities governed by the Act.
Spitzer claimed the regulation was invalid, but the district court enjoined his office from investigating alleged banking violations. The circuit upheld the regulation and injunction.
But the appeals court dismissed claims brought by the Clearing House Association, a banking consortium that wanted to enjoin the state Attorney General's Office from investigating violations of the Fair Housing Act. The circuit concluded that the claims were not ripe, since the Attorney General's Office had not filed an FHA enforcement action. See ruling.
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