Deputy AG Cautions on Using Regulatory Guidance as Policy

In a speech to a banking industry conference today, Deputy Attorney General Rod Rosenstein cautioned regulatory agency heads from substituting informal guidance for notice-and-comment rulemaking, noting that the Administrative Procedures Act provides a clear method for “promulgating regulations that reflect our official interpretation of application of certain laws.”

Rosenstein addressed the topic in response to a question about the Government Accountability Office’s recent decision on the banking agencies’ leveraged lending guidance. In that case, the GAO determined the guidance properly constituted a rule and thus should have been issued via notice-and-comment rulemaking.

Speaking to reporters at the same conference, Acting Comptroller of the Currency Keith Noreika — whose agency was one of the three issuing the leveraged lending guidance — said the banking agencies would provide initial thoughts about the fate of the guidance in the coming weeks. “I think we’re pretty much in the same place, and I do expect us to say something,” he said.