January 28, 2002 News Archive

Governor Gramlich Remarks on Predatory Lending
In an address delivered at the Housing Bureau for Seniors Conference in Ann Arbor, Michigan , Governor Edward M. Gramlich remarked on the abusive, unethical, and in some cases, illegal lending practices of lenders that prey on elderly homeowners, women, minorities and lower-income households. He also stressed the difference between predatory lending and the generally beneficial subprime lending, which compensate lenders for the increased risk associated with borrowers who do not qualify for prime loans.

Banking Committee to Examine Implementation of the "USA PATRIOT Act" Money Laundering Legislation
The Senate Banking Committee will hold a hearing on January 29, 2002, to examine the regulatory and enforcement efforts related to the financial war on terrorism and the Bush administration's implementation of the money laundering provisions of the "USA Patriot Act."

Sarbanes Requests GAO Investigation
In the wake of the collapse of Enron Corp, Senate Banking Committee Chairman Paul S. Sarbanes has asked the General Accounting Office (GAO) to investigate the investment of employee retirement funds and to report on the adequacy of financial reporting in the United States. Based on the press release, the GAO is being asked to address three specific areas: (1) situations in which employees suffered substantial retirement fund losses because of declines in value of company stock; (2) the number of U.S. retirement plans invested in company stock; and (3) laws governing employee stock ownership in retirement funds such as 401(k) plans. On financial reporting, the GAO is being requested to evaluate the governance system of the accounting profession and the extent to which defects in that system may have contributed to or increased the risks of irregularities.

Senator Sarbanes earlier announced an oversight hearing on February 12 to examine accounting and investor protection issues surrounding the Enron failure and problems with other public companies.