WASHINGTON - California Attorney General Bill Lockyer is urging the Federal Reserve Board to hold hearings in Los Angeles on Citigroup Inc.'s proposed acquisition of Grupo Financiero Banamex-Accival, citing consumer concerns.
Though distancing himself from the charges some activists have leveled at Citigroup, Mr. Lockyer said he was troubled by the Federal Trade Commission's lawsuit over the company's lending practices and wanted to know more about the planned fee structure of the merged company.
"My request that the Federal Reserve Board hold a hearing in Los Angeles instead grows out of my concern for the Latino consumer population in California, particularly those who have immigrated from or have relatives in Mexico, and the effect that the acquisition may have on these consumers," he wrote in a letter dated Monday.
Noting that predatory lending often hurts minorities disproportionately, he went on to write "for this reason, the accusation that Citigroup engages in predatory lending practices should be closely examined."
Acknowledging that many Latinos will likely use Citi to transfer funds between California and Mexico, Mr. Lockyer wrote: "For this reason, it is also critical that the Federal Reserve Board inquire into the fee structure that Citigroup plans to implement for the transfer of funds to and from Mexico."