How to Move the CRA Into the 21st Century

American Banker
4 minute read | November.03.2014

There's a disconnect in the banking agencies' approach to reforming the Community Reinvestment Act.

On the one hand, the Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. propose moving the CRA into the 21st century by deemphasizing branches as a means of serving lower-income neighborhoods and individuals. In their recent proposal to amend CRA regulatory guidance, the agencies note that there "are effective alternatives [to branches] in providing needed services to low- and moderate- income geographies and individuals." They specifically cite "technological advances in the retail banking industry, such as Internet or online banking, mobile banking, remote deposit capture and 24-hour Internet banking kiosks."

On the other hand, the starting point for determining the communities in which a bank has CRA obligations remains rooted in 1977, the year the law was enacted. A bank's assessment area is delineated based on where a bank has a physical presence. That a bank may engage in nationwide lending or deposit-gathering through the technological advances listed by the regulators is irrelevant to defining its assessment area.

Originally printed in American Banker; reprinted with permission.

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Warren Traiger Senior Counsel, Financial & Fintech Advisory, Strategic Advisory & Government Enforcement (SAGE)

New York

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Warren Traiger Senior Counsel

New York

He argued before the U.S. Court of Appeals for the Second Circuit in Lee v. Board of Governors, a benchmark case regarding the rights of community organizations to challenge Federal Reserve Board (FRB) determinations on merger applications. He has testified before Congress and the federal banking agencies on fair lending and CRA reform, served as Special Counsel to the New York banking regulator on CRA, and advised the regulator on predatory lending regulation.

Warren regularly helps banks and bank holding companies prepare the community convenience and needs portion of their regulatory applications to merge or acquire, and he helps clients respond to public comment regarding CRA and fair lending compliance. He represented a bank in its acquisition and integration of the finance arm of major automaker, directing pre-acquisition fair lending due diligence and updating the combined entity’s policies, procedures and regulatory relations strategy. Warren also served as an independent consultant for the New York Attorney General, overseeing compliance with that office’s settlement with a company that provides criminal background checks on prospective employees.

A prolific writer and researcher, Warren’s research and statistical analysis of mortgage lending data has been cited in publications of the Federal Reserve Banks of San Francisco, Boston and Dallas; the Federal Deposit Insurance Corporation (FDIC); and in testimony before the U.S. House Financial Services Committee.

Prior to joining Orrick, Warren was senior counsel at Buckley LLP. He also served as Co-Chairman of Traiger & Hinckley LLP. Prior to entering private practice in 1990, Warren was vice president, counsel and director of government relations for the New York Bankers Association, the trade group for New York commercial banks. He also served as director of legislation and research and special counsel for the New York City Department of Consumer Affairs and as a New York State Consumer Protection Board official.

Warren is entrenched in the New York legal and financial services community. He has served on the Banking Law Committee of the New York State Bar Association, as a member of the Banking Law and Consumer Law Committees of the Association of the Bar of the City of New York, and has taught as adjunct professor of economics at Hunter College of the City University of New York.