Banks Say They Will Decide Whether To Obey The Law
Another ignore the rule of law by corporations, this time by national banks, under the corporate protectionist Bush administrations.
From Elizabeth Warren at TPM Cafe comes this: "With the mortgage crisis smeared across the headlines every morning, you would think that the mortgage holders would keep their heads down. You would be wrong. The national banks are floating a new idea: they shouldn't have to obey state law when they foreclose on someone's home.
"Tomorrow Congressmen Brad Miller (D, NC) and Steve LaTourette (R, OH) will introduce HR 5380 to make it clear that the banks have to follow the state law foreclosure laws that they have always followed. Here is the scary part: this is expected to be a close vote.
"HR 5380 is a small, but smart piece of legislation. It says that if the states want to pass laws to deal with the current foreclosure crisis, then they are free to do so. In other words, this bill says that Congress may not be ready to fix the crisis, but it will at least stay out of the way so that the states can do so.
"If banks don't like the state laws, they are free to fight them in the state legislatures or the state courts. They can even make constitutional arguments about takings. But Congressmen Miller and LaTourette say they can't claim that Congress gave them a free pass.
"Since the founding of this country, foreclosure laws have been the special province of the state. In the same way that they set up the basic rules of property law and property transfer, states decide the terms on which people could be thrown out of their homes or off their farms by the mortgage lender. There are no federal foreclosure laws. Any mortgage holder--including a national bank or thrift--must abide by the terms of the state's foreclosure laws.
"But in the past few weeks, national banks have started making a new argument: state laws are pre-empted whenever a national bank holds the mortgage, so the states can't make them follow the local rules. Pre-emption has been used successfully by the credit card companies to fight off state regulation, so now the banks want to escape local restrictions on foreclosure as well.
"The scope of this claim is stunning. Because there is no federal foreclosure law, would the banks be free to do whatever they wanted? Could they simply order families out of their homes? Would federally-charted banks start buying up troubled loans from other banks, then doing their own vigilante expulsions?
"And if banks can get pre-emption here, where else can they get it? Do they become a law unto themselves?"
So now banks that were an integral part of the mortgage debacle are going to dictate which law they will follow, if any? Sounds like the Bush administration.
From Elizabeth Warren at TPM Cafe comes this: "With the mortgage crisis smeared across the headlines every morning, you would think that the mortgage holders would keep their heads down. You would be wrong. The national banks are floating a new idea: they shouldn't have to obey state law when they foreclose on someone's home.
"Tomorrow Congressmen Brad Miller (D, NC) and Steve LaTourette (R, OH) will introduce HR 5380 to make it clear that the banks have to follow the state law foreclosure laws that they have always followed. Here is the scary part: this is expected to be a close vote.
"HR 5380 is a small, but smart piece of legislation. It says that if the states want to pass laws to deal with the current foreclosure crisis, then they are free to do so. In other words, this bill says that Congress may not be ready to fix the crisis, but it will at least stay out of the way so that the states can do so.
"If banks don't like the state laws, they are free to fight them in the state legislatures or the state courts. They can even make constitutional arguments about takings. But Congressmen Miller and LaTourette say they can't claim that Congress gave them a free pass.
"Since the founding of this country, foreclosure laws have been the special province of the state. In the same way that they set up the basic rules of property law and property transfer, states decide the terms on which people could be thrown out of their homes or off their farms by the mortgage lender. There are no federal foreclosure laws. Any mortgage holder--including a national bank or thrift--must abide by the terms of the state's foreclosure laws.
"But in the past few weeks, national banks have started making a new argument: state laws are pre-empted whenever a national bank holds the mortgage, so the states can't make them follow the local rules. Pre-emption has been used successfully by the credit card companies to fight off state regulation, so now the banks want to escape local restrictions on foreclosure as well.
"The scope of this claim is stunning. Because there is no federal foreclosure law, would the banks be free to do whatever they wanted? Could they simply order families out of their homes? Would federally-charted banks start buying up troubled loans from other banks, then doing their own vigilante expulsions?
"And if banks can get pre-emption here, where else can they get it? Do they become a law unto themselves?"
So now banks that were an integral part of the mortgage debacle are going to dictate which law they will follow, if any? Sounds like the Bush administration.
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