OCC Rejects State Regulators' Push to Rescind Preemption Rules

The OCC rejected a request from the Conference of State Bank Supervisors ("CSBS") to rescind its federal preemption regulations, defending the rules as consistent with federal law, Supreme Court precedent and two recent Executive Orders.

In a letter responding to the CSBS argument that the preemption framework was inconsistent with Executive Orders 14219, "Ensuring Lawful Governance and Implementing the President's 'Department of Government Efficiency' Regulatory Initiative," (see related coverage) and 14267, "Reducing Anti-Competitive Regulatory Barriers," Acting Comptroller of the Currency Rodney Hood defended current OCC rules. He stated that the framework was consistent with the Barnett Bank of Marion County, N.A. v. Nelson decision on the preemption standard as affirmed by both the Dodd–Frank Act and the US Supreme Court's 2024 decision in Cantero v. Bank of America. The latter ruling confirmed that Congress did not create a new preemption standard in Dodd–Frank, but instead codified existing precedent.

The OCC also rejected the claim that the preemption regulations were anti-competitive, stating they align with the Executive Orders.