To the Editor:
Community groups and others concerned about the Community Reinvestment Act sunshine provisions included in the 1999 financial reform law by Sen. Phil Gramm should redirect some of their frustration from him toward Greenlining Institute policy director Robert Gnaizda and the institute ["Bureaucratic Cloud on CRA 'Sunshine,' " Viewpoints letter, Feb. 23], since they are one of the reasons why we have and need CRA sunshine.
In my book on CRA, I explain the facts behind the Greenlining Institute's failure to disclose its significant direct and indirect contributions from Wells Fargo Bank during its 1995 hostile bid for First Interstate.
While the California Reinvestment Committee, most other independent community groups, and more than 600 commenters favored First Bank System's white-knight bid or some alternative deal, the Greenlining Institute was reportedly responsible for 120 of the 135 witnesses supporting Wells Fargo.
As part of my comment on this merger, I repeatedly petitioned the Federal Reserve Board and Wells Fargo to disclose the bank's hefty contributions to Greenlining, but both refused. The Greenlining Institute, aware of my repeated requests, remained silent.
The Fed's March 6, 1996, order approving the merger specifically refused my request that they consider Wells Fargo's contributions to community groups like the Greenlining when weighing comments on the merger.
While the merger-friendly Fed most likely would have approved that deal anyway, a CRA sunshine law in 1995 would have disinfected that approval process and explained why the Greenlining Institute virtually stood alone among community groups in supporting Wells Fargo in what was then the second-largest bank merger ever.
The new sunshine provisions are far from perfect, but this needed disclosure ultimately will make CRA a better and more responsive law.
Kenneth H. Thomas,
Finance lecturer,
Wharton School,
University of Pennsylvania,
Philadelphia
