Round Peg, Round Regulation; Square Peg, Square Regulation
The US Court of Court of Appeals for the Second Circuit has held that state AGs and bank commissioners cannot outflank the Office of the Comptroller of the Currency and National Bank Act. At the same time, the court held that Title 42 Section 1983 of the US Code does not give banks federal rights against the states.
The court summarized the dual finding, “Indeed, national banks’ freedom from state regulation exists and expands as federal regulation of national banks becomes more defined. This dynamic indicates a preemptive scheme involved in ‘maintaining uniformity in the administration of the federal regulatory jurisdiction,’ as opposed to a scheme that also creates federal rights.”
A clear, national authority for national banking regulation…who’da thunk it?