From Inman News Service
The National Association of Realtors®’ effort to block banking institutions from entering the real estate brokerage business suffered a rebuke last month from U.S. Rep. Michael Oxley, chairman of the House Financial Services Committee.
The Republican congressman from Ohio issued a statement in support of the regulatory process that he said was established in the Gramm-Leach-Bliley Act. That’s the law the Federal Reserve and U.S. Treasury Department are relying on in a proposed rule that would permit banks to offer brokerage services.
NAR President Cathy Whatley of Jacksonville said the reintroduction of the legislation “sends a clear signal that Congress never intended to mix banking and commerce.”
Oxley apparently disagrees.
“Legislative attempts to stymie the rulemaking process are counterproductive and undermine the future of any legislation that relies on the expert judgment of regulators. Until the Fed and Treasury complete their work, legislation seeking to prevent them from acting is contrary to the intent of Gramm-Leach-Bliley,” Oxley said.
The Gramm-Leach Bliley Act enacted in November 1999 contains a mechanism that allows the Fed and Treasury to update a list of activities that are permissible for financial holding companies and national bank subsidiaries.
The congressman also said the opinion and input of John Snow, the man awaiting Senate confirmation as the next U.S. Treasury secretary, would be “an important addition to the process.”
Oxley insisted that Congress shouldn’t pass legislation “only to challenge its concepts once it is sent to the agencies for implementation.”
Oxley’s remarks took direct aim at the Community Choice in Real Estate Act that would prohibit banking conglomerates from entering the real estate business. That legislation was reintroduced in both houses of Congress earlier this month with NAR’s backing.
The legislation is identical to last year’s unsuccessful bill, which was supported by only a dozen or so senators along with about 245 members of the House. The sponsors are Reps. Ken Calvert (R-Calif.) and Paul Kanjorski (D-Pa.) and Sens. Richard Shelby (R-Ala.), Wayne Allard (R-Colo.) and Hillary Rodham Clinton (D-N.Y.)