WASHINGTON, April 28 (UPI) -- An apparently skeptical U.S. Supreme Court heard argument Tuesday on whether national banks can be investigated by the states for loan discrimination.
The National Bank Act says no national bank can be subjected to "any visitorial powers" unless authorized by federal law or the federal courts, or by either house of Congress.
The Office of the Comptroller of the Currency has issued an interpretation that says the act pre-empts state enforcement of state laws against national banks.
Then-Attorney General, later Gov. Elliot Spitzer began an investigation of the lending practices of some New York banks, and in 2005, the Federal Reserve released home mortgage data that for the first time contained data on the sex, race and income of applicants, SCOTUSblog.com reported.
Spitzer found the data showed the banks had issued high-interest home loans to minorities in a disproportionate manner.
But the state investigation ran afoul of the lower courts, which ruled that only federal investigators could conduct such an investigation.
Tuesday, several Supreme Court justices expressed concern about exposing national banks to state discrimination investigations, The Wall Street Journal reported.
"How is a bank to function if 50 different attorney generals, plus the federal regulators, all look at the books of the banks," liberal Justice Stephen Breyer said rhetorically from the bench, the Journal reported.
Other skeptics included Chief Justice John Roberts and liberal Justices John Paul Stevens, Ruth Bader Ginsburg and David Souter. The Journal said conservative Justice Antonin Scalia seemed to favor the state's position in his questions from the bench.
But comments from the Supreme Court bench are not always indicators of how a justice will vote in a ruling, which the high court is expected to hand down before retiring for the summer.
(Cuomo vs. Clearing House et al, No. 08-453)