Senate Banking Committee Chairman Phil Gramm has widened his probe of federal regulators who enlisted banks to support the Community Reinvestment Act.
The Texas Republican sent a letter Wednesday to Treasury Secretary Robert E. Rubin, inquiring whether the Office of Thrift Supervision also helped to prepare a list of financial institutions that would tout CRA's benefits.
Sen. Gramm, an archcritic of CRA, blasted the Office of the Comptroller of the Currency over the issue earlier this week.
In the letter, he demanded the names of all OTS employees who were involved in the search for pro-CRA thrifts, calling it a "matter of considerable importance and urgency." He also requested all relevant memos, e-mail, telephone logs, faxes, and other documents.
The Comptroller's Office admitted Wednesday that bank examiners had been improperly involved in preparing a list of pro-CRA banks. The agency said examiners only notified banks that they were on a list, but Sen. Gramm criticized the use of examiners as an improper mixing of its policymaking and supervisory missions.
An OTS spokesman said senior staff members discussed the issue with officials of the Treasury Department and the Comptroller's Office during a meeting in December and a conference call last month but never involved examiners or pressured any institution.
"The idea of identifying institutions that regard CRA favorably grew out of meetings with Treasury on how to counter efforts to reduce the scope or effectiveness of CRA," the OTS spokesman said. "Retaining a strong CRA is a long-standing position of both the administration and the Treasury Department."
The OTS asked community affairs liaisons in its regional offices to draw up the list, he said, but added, "We specifically instructed them not to contact individual institutions."
A Senate Banking Committee spokeswoman said it is unclear whether the OTS did anything inappropriate. "We understand there were similar discussions with OTS personnel, but at this point there is no information they acted on those discussions the way OCC did," she said.
Meanwhile, the Senate committee's staff continues to gather information to bolster Sen. Gramm's charges. He contends that community groups are forcing banks to pay them to keep them from protesting the banks' CRA records.
Sen. Gramm blocked financial reform legislation last year because of this and other complaints about CRA, and he has said he wants to strip CRA- related provisions from the reform bill and hold hearings on CRA later.
A Federal Deposit Insurance Corp. spokesman said Thursday that Sen. Gramm sent it a letter Jan. 25 seeking information on CRA challenges, including the names of merger protesters. The Federal Reserve Board said it has not received any letter from Sen. Gramm related to CRA.