Democratic members of the House Financial Services Committee pledged to subpoena documents and data used to develop a proposal to overhaul an anti-redlining law.
Tensions escalated during a hearing featuring testimony from Comptroller of the Currency Joseph Otting that examined the new proposal to modernize the Community Reinvestment Act, or CRA.
Committee Chair Maxine Waters, D-Calif., and other Democratic committee members threatened Otting with subpoenas to acquire the data the OCC used to develop its landmark proposal that the comptroller said was proprietary to banks.
The OCC and the Federal Deposit Insurance Corp. proposed a rule in December 2019 that aims to clarify how banks comply with CRA. However, the Federal Reserve declined to join the other regulators during the rollout. Fed Governor Lael Brainard outlined the Fed's approach to a modernized rule, which differed substantially from the OCC and FDIC's rule.
Brainard said in her Jan. 8 speech that the Fed developed its approach with the data collected from the results of 6,000 written, public CRA evaluations from about 3,700 banks varying by asset size, business model, geographic area and bank regulator.
Lawmakers at the hearing drew a distinction between the Fed's process and that of the OCC, which collected confidential data from an interagency data service, the Federal Financial Institutions Examination Council. The OCC is currently verifying the accuracy of the data.
That revelation angered Democrats, who perceived it as a sign that the OCC had not provided justification with accurate data and analysis to support its proposal.
"I believe that we should request the data and analysis used to create this rule, and if they don't want to share it willingly so we can do our job, we should subpoena such information," Rep. Nydia Velázquez, D-N.Y., said.
But Otting argued that much of the data that his agency used is confidential bank information that cannot be publicly disclosed.
Waters disagreed, asserting that Otting refuses to work with Democrats to incorporate their feedback in modernizing the CRA.
"I don't think Mr. Otting is willing to cooperate with us," Waters said. "You're absolutely right: If we have to subpoena the information, we will do that."
