I 

108TH CONGRESS 

2D SESSION H. R. 5251 

To clarify the applicability of State law to national banks, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

OCTOBER 7, 2004 

Mr. FRANK of Massachusetts (for himself, Mr. GUTIERREZ, Mr. SHERMAN, 

Ms. WATERS, Mr. SANDERS, Ms. WATSON, Mr. CLAY, Mrs. MCCARTHY

of New York, Ms. CARSON of Indiana, Mr. HINCHEY, Mr. PAUL, Mr. 

RANGEL, Mr. ACEVEDO-VILA ́, Mr. BRADY of Pennsylvania, Mr. 

SERRANO, Mr. DELAHUNT, Mr. DINGELL, Ms. LEE, Mr. WEINER, Mr. 

ACKERMAN, Ms. SLAUGHTER, Ms. SCHAKOWSKY, Mr. WAXMAN, and Mrs. 

MALONEY) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL 

To clarify the applicability of State law to national banks, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Preservation of Fed5 eralism in Banking Act’’. 
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1 SEC. 2. STATE LAW PREEMPTION STANDARDS FOR NA2 TIONAL BANKS CLARIFIED. 

3 (a) IN GENERAL.—Chapter 1 of title LXII of the Re4 vised Statutes of the United States (12 U.S.C. 21 et seq.) 

5 is amended by inserting after section 5136B the following 

6 new section: 

7 ‘‘SEC. 5136C. STATE LAW PREEMPTION STANDARDS FOR NA8 TIONAL BANKS AND SUBSIDIARIES CLARI9 FIED. 

10 ‘‘(a) STATE CONSUMER LAWS OF GENERAL APPLI11 CATION.— 

12 ‘‘(1) IN GENERAL.—Notwithstanding any other 

13 provision of Federal law, any State consumer law of 

14 general application (including any law relating to 

15 unfair or deceptive acts or practices and any con16 sumer fraud law) shall apply to any national bank. 

17 ‘‘(2) NATIONAL BANK DEFINED.—For purposes 

18 of this section, the term ‘national bank’ includes any 

19 Federal branch established in accordance with the 

20 International Banking Act of 1978. 

21 ‘‘(b) STATE BANKING LAWS ENACTED PURSUANT TO

22 FEDERAL LAW.— 

23 ‘‘(1) IN GENERAL.—Notwithstanding any other 

24 provision of Federal law and except as provided in 

25 paragraph (2), any State law that— 

26 ‘‘(A) is applicable to State banks; and 
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1 ‘‘(B) was enacted pursuant to or in accord2 ance with, and is consistent with, an Act of 

3 Congress, including the Gramm-Leach-Bliley 

4 Act and the Consumer Credit Protection Act, 

5 that permits States to exceed or supplement the 

6 requirements of any comparable Federal law, 

7 shall apply to any national bank. 

8 ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not 

9 apply with respect to any State law if— 

10 ‘‘(A) the State law discriminates against 

11 national banks; or 

12 ‘‘(B) the State law is inconsistent with 

13 other provisions of Federal law, but only to the 

14 extent of the inconsistency (as determined in 

15 accordance with the other provision of Federal 

16 law). 

17 ‘‘(c) NO NEGATIVE IMPLICATIONS FOR APPLICA18 BILITY OF OTHER STATE LAWS.—No provision of this 

19 section shall be construed as altering or affecting the ap20 plicability, to national banks, of any State law which is 

21 not described in subsection (a) or (b).’’. 

22 (b) DENIAL OF PREEMPTION NOT A DEPRIVATION OF

23 A CIVIL RIGHT.—The preemption of any provision of the 

24 law of any State with respect to any national bank shall 

25 not be treated as a right, privilege, or immunity for pur-
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1 poses of section 1979 of the Revised Statutes of the 

2 United States (42 U.S.C. 1983). 

3 (c) CLERICAL AMENDMENT.—The table of sections 

4 for chapter 1 of title LXII of the Revised Statutes of the 

5 United States is amended by inserting after the item relat6 ing to section 5136B the following new item: 

‘‘5136C. State law preemption standards for national banks and subsidiaries 

clarified.’’. 

7 SEC. 3. VISITORIAL STANDARDS. 

8 Section 5136C of the Revised Statutes of the United 

9 States (as added by section 2(a) of this Act) is amended 

10 by adding at the end the following new subsection: 

11 ‘‘(d) VISITORIAL POWERS.—No provision of this title 

12 which relates to visitorial powers or otherwise limits or re13 stricts the supervisory, examination, or regulatory author14 ity to which any national bank is subject shall be con15 strued as limiting or restricting the authority of any attor16 ney general (or other chief law enforcement officer) of any 

17 State to bring any action in any court of appropriate juris18 diction— 

19 ‘‘(1) to enforce any applicable Federal or State 

20 law, as authorized by such law; or 

21 ‘‘(2) on behalf of residents of such State, to en22 force any applicable provision of any Federal or 

23 State law against a national bank, as authorized by 

24 such law, or to seek relief and recover damages for 
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1 such residents from any violation of any such law by 

2 any national bank.’’. 

3 SEC. 4. CLARIFICATION OF LAW APPLICABLE TO STATE4 CHARTERED NONDEPOSITORY INSTITUTION 

5 SUBSIDIARIES. 

6 Section 5136C of the Revised Statutes of the United 

7 States (as added by section 2(a) of this Act) is amended 

8 by inserting after subsection (d) (as added by section 3) 

9 the following new subsection: 

10 ‘‘(e) CLARIFICATION OF LAW APPLICABLE TO NON11 DEPOSITORY INSTITUTION SUBSIDIARIES OF NATIONAL

12 BANKS.— 

13 ‘‘(1) IN GENERAL.—No provision of this title 

14 shall be construed as preempting the applicability of 

15 State law to any State-chartered nondepository insti16 tution subsidiary of a national bank, except to the 

17 extent the preemption is explicitly provided by an 

18 Act of Congress. 

19 ‘‘(2) DEFINITIONS.—For purposes of this sec20 tion, the following definitions shall apply: 

21 ‘‘(A) DEPOSITORY INSTITUTION, SUB22 SIDIARY.—The terms ‘depository institution’ 

23 and ‘subsidiary’ have the same meanings as in 

24 section 3 of the Federal Deposit Insurance Act. 
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1 ‘‘(B) NONDEPOSITORY INSTITUTION.—The 

2 term ‘nondepository institution’ means any enti3 ty that is not a depository institution.’’. 

4 SEC. 5. DATA COLLECTION AND REPORTING. 

5 (a) COLLECTING AND MONITORING CONSUMER COM6 PLAINTS.— 

7 (1) IN GENERAL.—The Comptroller of the Cur8 rency shall record and monitor each complaint re9 ceived directly or indirectly from a consumer regard10 ing a national bank or any subsidiary of a national 

11 bank and record the resolution of the complaint. 

12 (2) FACTORS TO BE INCLUDED.—In carrying 

13 out the requirements of paragraph (1), the Comp14 troller of the Currency shall include— 

15 (A) the date the consumer complaint was 

16 received; 

17 (B) the nature of the complaint; 

18 (C) when and how the complaint was re19 solved, including a brief description of the ex20 tent, and the results, of the investigation made 

21 by the Comptroller into the complaint, a brief 

22 description of any notices given and inquiries 

23 made to any other Federal or State officer or 

24 agency in the course of the investigation or res25 olution of the complaint, a summary of the en-
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1 forcement action taken upon completion of the 

2 investigation, and a summary of the results of 

3 subsequent periodic reviews by the Comptroller 

4 of the extent and nature of compliance by such 

5 national bank or subsidiary with the enforce6 ment action; and 

7 (D) if the complaint involves any alleged 

8 violation of a State law (whether or not Federal 

9 law preempts the application of such State law 

10 to such national bank) by such bank, a cite to 

11 and a description of the State law that formed 

12 the basis of the complaint. 

13 (b) REPORT TO THE CONGRESS.— 

14 (1) PERIODIC REPORTS REQUIRED.—The 

15 Comptroller of the Currency shall submit a report 

16 semi-annually to the Congress on the consumer pro17 tection efforts of the Office of the Comptroller of the 

18 Currency. 

19 (2) CONTENTS OF REPORT.—Each report sub20 mitted under paragraph (1) shall include the fol21 lowing: 

22 (A) The total number of consumer com23 plaints received by the Comptroller during the 

24 period covered by the report with respect to al25 leged violations of consumer protection laws by 
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1 national banks and subsidiaries of national 

2 banks. 

3 (B) The total number of consumer com4 plaints received during the reporting period that 

5 are based on each of the following: 

6 (i) Each title of the Consumer Credit 

7 Protection Act (reported as a separate ag8 gregate number for each such title). 

9 (ii) The Truth in Savings Act. 

10 (iii) The Right to Financial Privacy 

11 Act of 1978. 

12 (iv) The Expedited Funds Availability 

13 Act. 

14 (v) The Community Reinvestment Act 

15 of 1977. 

16 (vi) The Bank Protection Act of 1968. 

17 (vii) Title LXII of the Revised Stat18 utes of the United States. 

19 (viii) The Federal Deposit Insurance 

20 Act. 

21 (ix) The Real Estate Settlement Pro22 cedures Act of 1974. 

23 (x) The Home Mortgage Disclosure 

24 Act of 1975. 

25 (xi) Any other Federal law. 
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1 (xii) State consumer protection laws 

2 (reported as a separate aggregate number 

3 for each State and each State consumer 

4 protection law). 

5 (xiii) Any other State law (reported 

6 separately for each State and each State 

7 law). 

8 (C) A summary description of the resolu9 tion efforts by the Comptroller for complaints 

10 received during the period covered, including— 

11 (i) the average amount of time to re12 solve each complaint; 

13 (ii) the median period of time to re14 solve each complaint; 

15 (iii) the average and median time to 

16 resolve complaints in each category of com17 plaints described in each clause of sub18 paragraph (B); and 

19 (iv) a summary description of the 

20 longest outstanding complaint during the 

21 reporting period and the reason for the dif22 ficulty in resolving such complaint in a 

23 more timely fashion. 

24 (3) DISCLOSURE OF REPORT ON OCC

25 WEBSITE.—Each report submitted to the Congress 
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1 under this subsection shall be posted, by the Comp2 troller of the Currency, in a timely fashion and 

3 maintained on the website of the Office of the 

4 Comptroller of the Currency on the World Wide 

5 Web. 

Æ