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CommunityBank of Texas on Money Laundering as Protested Used Paid Letters now Brags Stellar

CommunityBank

of Texas on Money Laundering as Protested
Used Paid Letters now Brags Stellar

By Matthew
Russell Lee,
Patreon Story
BBC
Guardian
UK
Honduras
ESPN


FEDERAL COURT / S
Bronx, June 6 – Whether or not
the U.S. Community
Reinvestment Act will be again
enforced until the new
Administration and its
regulators remains an open
question. The same is the case
about money laundering

   As
the fourth CRA challenge of
2022, Fair Finance Watch with
Inner City Press on the FOIA
filed comments with the
Federal Reserve against
CommunityBank of Texas, fresh
off a money laundering / Bank
Secrecy Act settlement, with a
disparate record, see below.

Now in June the
banks are bragging without
irony about a new name,
Stellar Bank (why not
“Redlining Bank” or
“Laundering Bank”?) – and
saying they’ll close by the
end of June. What arrogance.
Or it seems they think / know
the regulators are paper
tigers. We’ll see.

“The parent
companies of CommunityBank of
Texas and Allegiance Bank have
announced that the resulting
company of their merger will
be named Stellar Bank. 
The rebrand will take effect
once the merger completes,
expected by the end of June.”
Really?

“From Fair
Finance Watch / Inner City
Press’ protest: “This is a
timely first comment on, the
Applications of CBTX, Inc.,
Beaumont, Texas; to merge with
Allegiance Bancshares, Inc.,
and thereby indirectly acquire
Allegiance Bank, both of
Houston, Texas. As an initial
matter, this is a request that
the FRS immediately send by
email to Inner City Press all
non-exempt portions of the
applications / notices for
which the Applicants have
requested confidential
treatment. Fair Finance Watch
has been tracking both banks,
and has found their lending
patterns
troubling.   In
Texas in 2020, CBTX’s
CommunityBank made 65 mortgage
loans to whites with 54
denials. Meanwhile to African
Americans it made only THREE
loans, while denying fully ten
applications. A referring
should be made to the DOJ for
fair lending
violations.    
In Texas in 2020, Alliance
Bank made 257 mortgage loans
to whites with 38 denials.
Meanwhile to African Americans
it made only SIX loans, while
denying fully seven
applications. Again, a
referring should be made to
the DOJ for fair lending
violations.   Public
evidentiary hearings are
needed – especially because,
and specifically on,
CommunityBank’s violations of
the Bank Secrecy Act:
“WASHINGTON—The Office of the
Comptroller of the Currency
(OCC) today announced a $1
million civil money penalty
against CommunityBank of
Texas, N.A., Beaumont, Texas,
for violations of the OCC’s
Bank Secrecy Act
regulations.  The OCC
found that CommunityBank of
Texas failed to adopt and
implement a Bank Secrecy
Act/Anti-Money Laundering
system of internal controls to
assure ongoing compliance with
the Bank Secrecy Act and its
implementing regulations. Such
deficiencies resulted in
CommunityBank’s failure to
timely file complete
suspicious activity reports
for approximately $100 million
of suspicious activity. 
The OCC’s civil money penalty
is separate from, but
coordinated with, the
settlement between
CommunityBank and the
Financial Crimes Enforcement
Network (FinCEN), which is
also being announced
today.”    
FFW and Inner City Press have
been deeply concerned about
the rush by the Federal
Reserve’s to rubber-stamp
mergers by redliners, money
launderers and predatory
lenders. This has been killing
the Community Reinvestment Act
and we timely request public
hearings. The comment period
should be extended;
evidentiary hearings should be
held; and on the current
record, the application should
not be approved.”

 In
response? CBTX put in a
one-line letter of support
from a hospital, and another
bragging about other support
from “corporate sponsors such
as Valero, ExxonMobil, Entergy
and many
others.” That was from
Nutrition & Services for
Seniors. Who else? And how
does this rebut money
laundering and redlining?

  Well, the
Federal Reserve asked some
questions – while at the same
time declining to extend the
comment period. They asked “0.
Page 18 of the public section
of the application states that
the best CRA practices of
both  institutions will
be leveraged to create an
enhanced CRA program at the
combined bank  and that
additional information would
be provided when it becomes
available. Provide 
updated information about the
CRA program. If that
information is not yet
available,  provide a
timeline for when that
information will be
available.  11. Clarify
whether the consumer
compliance (including fair
lending) programs at the 
combined bank would be
CommunityBank’s current
programs, Allegiance
Bank’s  INTERNAL
FR/OFFICIAL USE // EXTERNAL
current programs, some
combination of the current
programs of CommunityBank
and  Allegiance Bank, or
programs developed from other
sources.  12. Indicate
the key individuals who would
be responsible for the CRA and
consumer  compliance
(including fair lending)
programs at the combined bank,
as well as their 
qualifications and
experience.  13. Describe
any modifications to the
merged bank’s consumer
compliance risk
management  program that
are planned as a result of
this proposal. 
[Confidential Question] 
14.”  Yeah, confidential

  On
February 17 Fair Finance Watch
filed timely comments opposing
the application with the
self-described new FDIC. We’ll
see. Watch this site.

As to the Fed,
which denies FOIA requests
after five months, here,
on August 25, this strange
response: “Dear Mr.
Lee,    
This is to acknowledge receipt
of your email to the Office of
the Secretary for the Board of
Governors of the Federal
Reserve System (Board) dated
August 17, 2021, regarding the
proposal of South State
Corporation to merge with
Atlantic Capital Bancshares,
Inc., and thereby indirectly
acquire Atlantic Capital Bank,
NA.  To date, South State
Corporation has not filed an
application with the Federal
Reserve System. 
Currently, the public comment
period for the proposal will
end on September 20,
2021. 

   If
an application is filed within
the next three months from the
date your comment was sent,
your correspondence will be
made part of the record, and
the Board will evaluate your
comment.  We will also
send a copy of the public
portions of the application as
soon as possible after the
application is
received.    
Sincerely,    

Jennifer Snow  Senior
Examiner  Supervision,
Regulation, and Credit 
Federal Reserve Bank of
Atlanta    
Integrity. Excellence.
Respect.”

How can there be
a comment period with
expiration date, if there is
no application? Inner City
Press asked, and on August 26
is told:

“Our procedures
provide that advance notice in
the Federal Register may be
requested in advance of a
filing. The comment period end
date applies to the Federal
Register notice, which was
filed in advance of the
application being filed.”

   What
– the comment period running
to its conclusion, before any
application to comment on is
available? This seems far too
bank-friendly. How does it
relate to the administration’s
Antitrust Memo? Watch this
site.

 Inner City
Press (and Fair Finance Watch,
on the HMDA) will have more to
say about this. Watch this
site.

***

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