Per a Jan. 5 filing, New York’s attorney general is leading the charge against the Office of the Comptroller of the Currency and current Acting Comptroller Brian Brooks.
According to Cointelegraph, in October, the OCC laid out its “True Lender” rule, which took effect in late December. The rule states that a loan that includes a national bank as a lender can therefore rely on the OCC’s national guidance rather than that of individual states. The controversy here is that many states have especially strong anti-usury provisions, which cap interest rates in the hope of preventing predatory lending. Today’s complaint claims that the OCC has not taken the concerns seriously:
“While the OCC pays lip service to condemning predatory lending, it gives its wholesale endorsement to lending relationships predicated on evasion of usury laws designed to protect consumers.”
The OCC said upon announcing the rule that:
“Banks’ lending relationships with third parties can facilitate access to affordable credit. However, increasing legal uncertainty regarding such relationships may discourage banks and third parties from partnering, limit competition, and chill the innovation that results from these partnerships. This may ultimately restrict access to affordable credit.”
In their complaint, the state regulators allege that the OCC overstepped its authority by overriding — or preempting— state law. They stated that the regulator also violated the Administrative Procedure Act in rushing its rule out the door without taking comments on its rule proposal seriously. Furthermore, the regulators ask the court to “declare that the OCC violated the APA because its True Lender Rule is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”At the same time, just last night, the OCC sent out a new interpretive letter that would allow national banks to run nodes for stablecoin networks. For this, Brooks has become a folk hero among the crypto community since taking over as Acting Comptroller in May.