Public Comment Regarding Reforming the Community Reinvestment Act Regulatory Framework

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To Whom It May Concern:

I appreciate the opportunity to comment on the Office of the Comptroller of the Currency’s (OCC) advance notice of proposed rulemaking on reforming the Community Reinvestment Act (CRA) regulatory framework.

The Cato Institute is a public policy research organization dedicated to the principles of individual liberty, limited government, free markets, and peace. Cato’s Center for Monetary and Financial Alternatives, at which I am a policy analyst, is dedicated to revealing the shortcomings of today’s centralized, bureaucratic, and discretionary monetary and financial regulatory systems and to identifying, studying, and promoting alternatives more conducive to a stable, flourishing, and free society. I thank Comptroller Otting and the OCC for their leadership in the discussion of how regulation needs to change to better promote financial inclusion.

The Community Reinvestment Act (CRA) is a 41‐​year‐​old statute that requires depository institutions “to demonstrate that their deposit facilities serve the convenience and needs of the communities in which they are chartered to do business […] consistent with the safe and sound operation of such institutions.” The CRA seeks to improve the welfare of low‐ and moderate‐​income (LMI) Americans by assessing and rating depository institutions on the basis of how much they lend to, invest in, and serve the communities in which LMI Americans live. Racial minorities were and continue to be overrepresented among LMI communities, so the CRA is considered part of the anti‐​discrimination legislation of the late 1960s and 1970s.

Diego Zuluaga

Diego Zuluaga is a policy analyst at the Cato Institute’s Center for Monetary and Financial Alternatives, where he covers financial technology and consumer credit.