Fed
Rejects
Community Bank
System -
Oneida
Withholding 8
of 9 Responses
By
Matthew R. Lee
NEW
YORK, August 1
-- The lack of
seriousness in
US bank
regulation
extends from
large to
smaller banks.
As Inner City
Press exposed
last month,
Royal Bank of
Canada jumped
the gun and
began doing
business with
City National
Bank without
any Federal
Reserve
approval (see
Los
Angeles Times,
here.)
Community Bank
System of
upstate New
York filed
with the Fed
nine answers
to questions
asked after
Inner City
Press'
challenge --
and tried to
withhold fully
eight of the
nine
responses. More
here.
Inner City
Press
immediately
filed a
Freedom of
Information
Act request
for the whole
submission -
and even the
Federal
Reserve has
seen through
Community Bank
System's
absurdly --
and tellingly
-- overbroad
withholding,
releasing all
but one part
of one of the
eight withheld
responses.
Here's
is the Federal
Reserve's
letter to
Inner City
Press granting
most of its
FOIA request:
Freedom
of Information
Act Ruling
Rejecting
Community Bank
System
Withholding 8
of 9 Responses
on Oneida
Ap... by Matthew
Russell Lee
here
is the now
unredacted
version of
Community Bank
System's
submission.
Unredacted
Version of
Community Bank
System's
Responses on
Oneida, After
ICP's FOIA
Request by
Matthew
Russell Lee
We'll
have more on
this.
Background:
The largest
bank merger
recently
proposed, that
of Royal Bank
of Canada and
affluent-focused
Los
Angeles-based
City National
Bank, has
since April
been the
subject of a
Community
Reinvestment
Act challenge
by Fair
Finance Watch.
The LA Times
has reported
on the "letter
from the Fed
[which] asks
the banks to
respond to
questions
raised in
written
comments by
[FFW].
Spokesmen for
the banks
declined to
comment....
Fair Finance
Watch, a New
York advocacy
group for
minorities,
questioned a
deal between
the banks in a
June 11
comment letter
to the Fed."
Inner City
Press first
put that Fed
letter online,
here; then
Canada's
National /
Financial Post
reported
without credit
it had
"obtained" it.
By contrast,
in the pending
proposal of Community Bank System - Oneida, the Syracuse
Post-Standard
disclosed
that "Inner
City Press
forwarded the
letter to news
outlets. Some
of the Fed's
questions
focus on
whether
Community
could
improperly
control
matters at
Oneida in
advance of the
acquisition. Community
is working on
Fed's
questions,
said Hal
Wentworth,
Community's
senior vice
president for
retail
banking."
One common
theme is that
non-control
(and therefore
antitrust)
laws are being
violated. One
difference is
that Community
Bank System
does comment
to the media
-- if only to
blame
the messenger
-- while
larger RBC and
CNB do not.
Arrogance?
On
Community Bank
System's
blaming the
messenger, FFW
has commented
to the Fed
that it will
"will comment
again when
Community Bank
System I has
provided a
copy of its
response to
the FRS'
questions of
July 13.
Beyond the CRA
and
impermissible
“control”
questions
raised
therein, we
wish at this
time to raise
the issues
that, in a
public
response to
ICP's
comments,
Community Bank
System's SVP
for retail
banking said
the following,
in a prepared
statement no
less:
'In a
statement
today, Hal
Wentworth,
Community's
senior vice
president for
retail
banking, said
that Inner
City Press is
not a local
group and
pointed out
that letter
was the only
one filed on
the Oneida
deal. "This
activist does
not do
business with
either Oneida
or Community
Bank."'
If it
would be
inappropriate
for Community
Bank System to
comment on or
disclose
information
about its
customers, in
this context
the same
applies to the
above-quoted,
which,
separately, is
reminiscent of
human rights
abusing
countries
emphasizing
where the
rights groups
who study and
report on them
are based."
Now Community
Bank System is
trying to
withhold eight
of its nine
responses;
Inner City
Press is
challenging
this under the
Freedom of
Information
Act, comparing
Community Bank
System's
outrageous
withholding at
the Fed with
other banks,
and with
Community Bank
System's to
the OCC, more
here.
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