WASHINGTON - A House Banking Committee Democrat blasted Republicans for criticizing lending practices at the failed Madison Guaranty Savings and Loan while aiming to loosen bank regulations.
"The Republicans spent much of last week expressing their righteous rage about taxpayer dollars squandered on Madison Guaranty," said Rep. Carolyn B. Maloney of New York on Monday. "One can only wonder why they want to recreate the same regulatory environment which made the Madison Guaranty scandal possible.
"It is the height of hypocrisy."
Questionable insider lending practices at the failed Arkansas thrift were among the areas covered during the committee's Whitewater hearings last week.
Rep. Maloney specifically criticized a provision in the regulatory relief bill that would exempt many banks from a 1991 requirement that they maintain an audit committee composed entirely of outside directors. Under the measure, banks deemed by regulators to be "well capitalized and well managed" would be exempted from all audit committee requirements.
"Members of the audit committee are charged with taking an independent look at a bank's financial records," Rep. Maloney said. "But it takes an independent director to take an independent look."