WASHINGTON - The National Association of Realtors is sounding the battle call against a proposal that would let financial holding companies provide real estate brokerage services.
The association is asking its 760,000 members, federal lawmakers, and even small bankers to flood the Federal Reserve Board and the Treasury Department with comment letters against the proposal.
The Fed and Treasury in December proposed adding real estate brokerage and management to the list of activities that are permissible for financial holding company units and financial subsidiaries of national banks. The deadline for comments is March 2.
These new powers would be among the first authorized as "financial in nature" under the terms of the Gramm-Leach-Bliley Act of 1999.
But in a news conference Tuesday, officials of the Realtor group argued that real estate services fall outside the bounds of financial activities as intended by Gramm-Leach-Bliley. The law bars financial companies from engaging in commercial activities, and the association lobbyists said that real estate is clearly nonfinancial.
Some members of Congress appear to be sympathetic with the group's claims.
On Feb. 1, Rep. Spencer Bachus, R-Ala., sent a letter to Fed Chairman Alan Greenspan and Treasury Secretary Paul O'Neill asking them to extend the comment period to June 1. Rep. Bachus, who is chairman of the House Financial Services subcommittee on financial institutions, said the extension would give Congress time to hold hearings on whether industry changes warrant expanding the list of financial and related activities.