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By Matthew R. Lee, Full Doc on Patreon Here

NEW YORK, August 1 – Two months after Inner City Press reported Capital One failing in its proposal to acquire Cabela's "World's Foremost Bank," a way to try to avoid the regulators and Capital One's Community Reinvestment Act record emerged. The scam involves Synovus buying the bank then passing one the credit card receivables to Capital One, while keeping the deposits, so Capital One wouldn't be reviewed under CRA. The Fair Finance Watch has opposed this, in a filing to the Federal Reserve, below. And the Federal Reserve has, with all formality, informed Fair Finance Watch and Inner City Press of a July 21 meeting with Synovus, to discuss a "confidential supervisory matter," Fed "memo to file, on Patreon here. Amid the arb interesting, a publication (via here) has opined that only now was Synovus' application moved from the Federal Reserve Bank of Richmond to the Board in Washington - false, since Inner City Press / Fair Finance Watch's first substantive filing triggered this move. Will the OCC tie its review of Synovus to reviewing Capital One's proposal to buy the credit cards? If Capital One is not good enough to buy deposits, why should it be allowed to acquire these credit cards and customers? This transaction is a fraud. We'll have more on this.

Date: July 27, 2017
To: File
From: Federal Reserve staff
Subject: Telephone Conversation with Clifford S. Stanford, Esq. and Synovus Bank Representatives re: Application by Synovus
Bank to Acquire Substantially All of the Assets and Liabilities of World’s Foremost Bank

On July 21, 2017, staff of the Board of Governors of the Federal Reserve System (Alison Thro, Jon Stoloff, Andrew Hartlage, Brian Phillips, Betsy HowesBean, and Donald Arrington) and the Federal Reserve Bank of Atlanta (Jordan Light, Juan Sanchez, Sabrina Francis, Dwight Blackwood, Steve Wise, and
Kathryn Hinton) had a telephone conversation with representatives of Synovus Bank (Kessel Stelling, Kevin Blair, Mary Maurice Young, and
Allan E. Kamensky), Columbus, Georgia, and Clifford S. Stanford and Mark Kanaly, counsel for Synovus Bank, in connection with the application filed by Synovus Bank to acquire substantially all of assets and liabilities of
World’s Foremost Bank, Sidney, Nebraska, pursuant to section 18(c) of the Federal Deposit Insurance Act.

Staff discussed a confidential supervisory matter with Mr. Stanford and the Synovus Bank representatives." See here.

  FFW's protest:  "On behalf of Inner City Press / Fair Finance Watch (FFW), this is a timely first comment opposing and requesting an extension of the FRS' public comment period on the Application by Synovus - and, we contend, CAPITAL ONE NA, to acquire the “WORLD'S FOREMOST BANK.”This comment is timely. For the record, there was initially filed with the OCC an application by Capital One to buy this “Foremost Bank.” When the compliance problems of that proposal became clear, this sham transaction was devised: for Synovus (also dubious) to make the initial acquistion, and then pass much of it on to Capital One, thereby evading review of Capital One, including but not limited to CRA review. This should not be countenanced. This applications is not even listed in the FRB's H2A, but only the H2, thusly: “* 18C Not applicable Synovus Bank, Columbus, Georgia, to acquire 05/19/2017 certain assets and to assume the deposits of World's Foremost Bank Sidney, Nebraska” It does not mention the role of Capital One. In the New York City MSA in 2015, the most recent year for which HMDA data is available, for conventional home purchase loans Capital One denied the applications of whites 23% of the time, while denying African Africans fully 45% of the time, and Latinos even more, 46% of the time. This is unacceptable.
Meanwhile, Capital One is “closing branches in Laurel, Gaithersburg, Frederick and Merrifield.”
As to Synovus' Bank, in 2015 in the Atlanta GA MSA it made 53 home purchase loans to whites and only seven to African Americans, NONE to Latinos. In the Birmingham Alabama MSA it made 45 home purchase loans to whites and only three to African Americans. If the bank cites Synovus Mortgage, note that in the Charlotte NC MSA in 2015 for home purchase loans, it lend to whites but not African Americans much less Latinos. Fair Finance Watch will submit further comments in the extended comment period. On the current record, the application(s) should be denied."

 In December it was Astoria's proposed take over by NY Community Bancorp, here. Soon, Sterling.

   In January, disparate lender Investor Bancorp, on which Fair Finance Watch previously got a condition imposed saw its proposal with Bank of Princeton fall apart.

  And now it's Capital One - Cabela, on which Inner City Press commented: "In the New York City MSA in 2015, the most recent year for which HMDA data is available, for conventional home purchase loans Capital One denied the applications of whites 23% of the time, while denying African Africans fully 45% of the time, and Latinos even more, 46% of the time. This is unacceptable.

  Meanwhile, Capital One is “closing branches in Laurel, Gaithersburg, Frederick and Merrifield.”

   Capital One came back with snark, as has Simmons National -- but then announced including to NCRC that  it will withdrawn its application. Onward.

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