WASHINGTON - Four months after Senate Banking Committee Chairman Donald Riegle asked the Federal Reserve to hold regional hearings on lending discrimination, the agency has yet to come up with a formal response.
A proposal to hold the hearings was recently slated to be considered at a Fed meeting, but the meeting was abruptly canceled, without explanation. The issue has quietly disappeared from the agendas of future meetings.
And more than a month ago, Fed Chairman Alan Greenspan told Sen. Riegle in a letter that though the Fed had held lengthy discussions on the matter, it had not reached a decision.
Sen. Riegle's office has awaited the Fed's decision, but has not received an answer. Last week, the Michigan Democrat again publicly prodded the Fed for a response.
In a letter to The Washington Post, he said the Fed needs to take more aggressive action to end lending discrimination.
"I have asked Chairman Alan Greenspan to conduct field hearings on mortgage discrimination and am awaiting the board's response," he wrote. "Inner-city residents deserve a chance" to let the Fed know "firsthand how serious this problem is."
The Federal Reserve is working on a plan - through the regional reserve banks - to hold low-profile, problem-solving sessions with bankers and community groups.
But the plan has not been finalized, and Sen. Riegle, who has signaled that he expects regulators to take a tougher stance against bias, has not been briefed about it.
The Fed has already denied a similar request to hold hearings on second-mortgage market scandals. That request was first made by Bruce Marks, head of Boston's United Neighborhood Assistance Corp., and was repeated by Sen. Riegle.
Mr. Marks also asked the Senate Banking Committee to hold regional hearings, but the committee refused, saying the regulators should do it.
Mr. Marks riled Fed officials this spring when he called a press conference - at the Fed's Washington headquarters where he said Fed officials would announce that they would hold public hearings. No one at the Fed had agreed to such an event, Fed officials said, or to hold hearings.
Fed officials are so angry at the group that they don't want to be seen as caving in to its call for public hearings in any way.