The Back Alley Archives

March 26 (Bloomberg) -- The Obama administration’s call for greater financial regulation may have its limits.

The administration late yesterday urged the U.S. Supreme Court to bar New York and other states from enforcing their fair-lending and other consumer-protection laws against federally chartered banks including JPMorgan Chase & Co. and Wells Fargo & Co.

The legal brief, which adopts the Bush administration’s position, is a setback for consumer and civil-rights groups that had urged President Barack Obama’s team to switch positions. The filing puts the administration at odds with New York Attorney General Andrew Cuomo over the respective roles of state and federal regulators. The high court will hear arguments April 28.

“National banks are created by the government to serve federal purposes,” argued Solicitor General Elena Kagan, the Obama administration’s top courtroom lawyer. “Oversight of the banks is therefore principally entrusted to the United States.”