PRESS RELEASE
Posted on: April 19, 2007

Contact:
Jodi Greenblatt
(703) 342-5842

Supreme Court Sides with Wachovia and Against Consumers
NAMB Disappointed by Court Decision to Allow Federal Pre-Emption of State Lending Laws

Washington, D.C. - April 17, 2007 - The National Association of Mortgage Brokers (NAMB), today expressed disappointment at the Supreme Court's decision to allow the Comptroller of the Currency (OCC), to pre-empt state lending laws in regulating the activities of mortgage subsidiaries of federally chartered banks.

NAMB believes it is important to have the same education and background check standards for all mortgage originators. This decision can delay implementation of these important consumer protections.

Calling the decision bad for consumers, NAMB President Harry Dinham said, "We believe that any entity utilizing the corporate liability protections of a state should be governed by the laws of that state, particularly since most mortgage lending laws are enforced at the state level. Today the court told the subsidiaries of federally chartered banks that it is OK to operate under the radar, without accountability to the citizens of the states where they do business."

Under current law, consumers who have grievances against a subsidiary of a federally chartered bank must file their complaint with the OCC in Washington DC, with no local or state agencies empowered to formally hear complaints or offer assistance.

"Most consumers don't know the difference between a federally or state chartered bank," Dinham continued, "They naturally assume all banks and mortgage originators are equally regulated by the government they trust. This ruling will continue to allow unequal oversight and enforcement of mortgage lending institutions to the detriment of would-be homebuyers."

"We are disappointed the U.S. Supreme Court missed this opportunity to reach the conclusion that companies conducting the same type of business in any state should be governed by the same rules, regardless of charter.

This decision now allows Congress to address the issue of requiring all mortgage originators to adhere to education and background check standards that are uniform, whether they work at a bank, a credit union, a lender, or a mortgage brokerage.

The need for a federal standard that addresses regulation in the same manner for all originators has never been greater," Dinham concluded

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The National Association of Mortgage Brokers is the voice of the mortgage broker industry with more than 25,000 members in all 50 states and the District of Columbia. NAMB provides education, certification and government affairs representation for the mortgage broker industry, which originates over 50% of all residential loans in the United States.

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