news-record.com

RALEIGH — Attorney General Roy Cooper is unhappy with pending federal legislation that in many respects mimics North Carolina’s predatory lending law, which he helped craft and now enforces.

Making his objections all the more awkward is the fact the federal bill, HR 1728: “Mortgage Reform and Anti-Predatory Lending Act,” is sponsored by Democratic Reps. Mel Watt and Brad Miller, philosophical allies when it comes to regulating the financial services industry.

However, the pending federal legislation would pre-empt state laws, keeping North Carolina from enforcing some of its own anti-predatory lending statutes, which help
homeowners avoid loan terms that they can’t repay or come attached with high fees and interest.

“I don’t want to replace North Carolina’s strong laws with weaker federal laws,” Cooper said. For example, Cooper said North Carolina further restricts up-front fees and more tightly regulates brokers than the federal bill would.

The argument is similar to one Cooper and other attorneys general have been having with the Comptroller of the Currency over state regulation of banks with national charters. That debate has landed in front of the Supreme Court.

Miller understands Cooper’s complaint, and in a perfect world, the Raleigh Democrat said, he would not pre-empt states at all.

However, Miller said it’s unlikely the bill could pass out of the House Financial Services Committee without some pre-emption language. But the measure is due for a committee drafting session today, Miller said, and the language that would take away powers from the states will be narrowed.

As he described it, state laws would only be pre-empted in certain “subjective” circumstances, such as disputes where there is no hard evidence that the mortgage broker was selling a loan the buyer couldn’t afford.

The federal law would have its greatest impact in states with no anti-predatory lending laws of their own. Adding protections in those states, Miller said, would help North Carolina in the long run.

“We do have a national economy,” Miller said.

Still, Cooper said it would make more sense to leave states along entirely.

“States react very quickly to new schemes by lenders,” Cooper said. “Congress moves at the speed of a glacier. They’re still trying to pass laws we passed in 1999.”

Quotes and notes

Democratic Sen. Kay Hagan and Republican Sen. Richard Burr have had a lot on their minds over the past week. Among the thoughts they’ve been sharing:

* Hagan took issue with the Obama administration’s trade representative saying that the North American Free Trade Agreement may not need to be renegotiated.

“This country’s current trade policy is not working. The manufacturing economy in North Carolina has suffered and far too many North Carolinians have lost their jobs,” Hagan said.

“It is only right we require our trading partners to enforce the labor and environmental standards that we ask of our manufacturing industry.”

* Burr said he will vote against Kansas Gov. Kathleen Sebelius’ nomination to be secretary of Health and Human Services.

“I am troubled by her decision late last week to veto a Kansas bill that would have tightened restrictions on late-term abortions, and I intend to vote against her confirmation,” Burr said.

* Burr was happy the Senate passed his resolution honoring the UNC Men’s basketball team for winning the NCAA tournament.

“I am pleased the Senate has recognized the hard work and achievement of the players, coaches, students and staff whose perseverance and dedication contributed to the Tar Heels bringing home the national title. This is a team that all North Carolinians can be proud of.”

* Hagan was in High Point this weekend praising the furniture market on its 100th anniversary.

“While the success of the Market shows those investments have paid off, I believe it is vitally important to the North Carolina economy that the High Point Furniture Market remains the county’s premier furniture marketplace long into the future, and I am committed to that goal,” Hagan said.

Votes

In the Senate, matters voted on included:

* Approving the nomination of Christopher Hill to be ambassador to Iraq. Hill was involved with negotiations to end hostilities in Bosnia during the 1990s and has been involved in nuclear disarmament talks with North Korea.

The vote was 73-23.

Burr voted yes. Hagan voted yes.

* Rejecting a change to the False Claims Act, which allows private citizens to file suit on behalf of the government. The change would have capped awards to the private parties at $50 million. This provision came up as part of the debate on an anti-fraud statutes related to mortgages and securities.

The vote was 31-61.

Burr voted yes. Hagan voted no.

In the House, matters voted on included:

* Expanding the COPS program, which helps provide extra police officers to local departments. The measure, HR 1139, would also authorize grants for combatting gangs and other purposes.

The vote was 342-78.

Democrats Brad Miller and Mel Watt voted for the bill.

Republicans Howard Coble and Virginia Foxx voted against.

* Funding preservation of rare large cats, such as cheetahs, and dog species as described in HR 411.

The vote was 290-118.

Miller and Watt voted yes.

Coble and Foxx voted no.
 

Contact Mark Binker at (919) 832-5549 or mark.binker@news-record.com