The inter-regulator fight over the proper parameters of a foreclosure fraud settlement are really highlighting the changes in the financial regulatory world. What we’re told is that the OCC and Fed are urging a weak settlement, while FDIC, the state AGs, and the Consumer Financial Protection Bureau (CFPB) are pushing for a serious settlement.
Parts of this line up look quite familiar, but parts are new and exciting.
There’s nothing new or surprising about the OCC protecting (rather than regulating) the banks. Similarly, it’s not surprising to see the Fed back the banks, although, the Fed tends to be less gung-ho than OCC in these matters (and I would note that there isn’t necessarily unanimity within any agency on these issues). It’s also no surprise to see the state AGs on the other side, pushing for regulation. Gosh, this just sounds like a Wachovia v. Watters redeux (one of OCC’s most shameful moments in recent years—putting its preemption agenda ahead of consumer protection in the mortgage space. Now where did that get us?)
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