|FOR IMMEDIATE RELEASE:||CONTACT: CHRISTI HARLAN|
|Thursday, December, 21 2000||202-224-0894|
Sen. Phil Gramm, chairman of the Senate Committee on Banking, Housing and Urban Affairs, made the following statement today on the regulations issued by federal banking regulators to implement the sunshine provisions of the Gramm-Leach-Bliley Act, which require public disclosure of bank agreements related to the Community Reinvestment Act.
"I am disappointed to see that federal banking regulators, whose job it is to serve the public, have opted to satisfy special interests, not the public's interest, in issuing these regulations.
"The sunshine provisions approved by Congress were based on a simple premise: If a law promotes the giving of money for a public benefit, there must be accountability," Gramm said. "The regulations issued today will keep citizens in the dark about the benefits purportedly bestowed in their behalf."
For example, the regulations raise a hurdle to public access to CRA agreements by requiring citizens to file requests for the documents under the cumbersome Freedom of Information Act.
In addition, as Gramm warned in a Dec. 11 letter to Federal Reserve Chairman Alan Greenspan, the regulations provide a "blueprint" for banks and CRA beneficiaries to avoid compliance with the sunshine requirements by simply deleting references to specific beneficiaries from announcements of CRA-related grants and loans.
"Under the regulations issued today, with a knowing wink, parties can evade the requirements of the law and keep their deals hidden from the public," Gramm said.
The sunshine requirements, contained in Section 711 of the Gramm-Leach-Bliley Act, require banks to disclose agreements with community groups that receive payments or loan agreements in connection with CRA. Groups that receive funds in connection with CRA are required to disclose the specific uses of those funds. The requirements, which became law Nov. 12, 1999, are intended to allow community residents to assess the performance of banks and community groups that purport to work on their behalf.