The OCC is up to its old tricks. It doesn’t matter how bad things are out there for consumers–one can always count on the OCC to stand up against any attempt to regulate the consumer lending practices of national banks.
The OCC’s latest shande is its opposition to the Federal Reserve’s proposed expansion of Regulation AA, which defines and bans certain unfair and deceptive acts and practices (UDAP). The OCC’s response, is perhaps the best illustration of its complete regulatory capture–the OCC is objecting to the proposed Regs because it is concerned that they will hurt bank safety-and-soundness, and constrict lending (which it claims is bad for consumers).
Somehow the OCC’s parallel agencies–the OTS and NCUA, which regulate federal thrifts and credit unions, haven’t been overwhelmed by the same concerns, as they have proposed parallel UDAP regulations to the Fed’s. It seems that the OCC doesn’t understand that UDAP regulations are about consumer protection, not safety-and-soundness. But, then it is hard to think of a federal agency that is more in the thrall of the entities it “regulates.”