On July 21, the OTS will be merged with the OCC, as required by the Dodd-Frank Act. This NPR addresses many procedural issues germane to the assumption by OCC of OTS’s duty to regulate federal savings associations (e.g., assessments, transfer of rulemaking, employment contracts, etc.). However, it also addresses a strategic issue in the Dodd-Frank Act: the scope of OCC preemption powers. While the OCC has bowed to recent Supreme Court decisions that curtail preemption for national banks in some respects, it has interpreted the new law as largely leaving intact its ability otherwise to preempt state consumer-protection laws. The OCC’s decision to assert its preemptive powers would establish this as the governing principle unless or until it is overturned in the courts or by Congress.
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