Attorney General Dan Rayfield filed a lawsuit today to block the Trump Administration’s latest effort to favor big business over working families, co-leading a coalition of 10 states. The case challenges a decision by a little-known but powerful federal agency, the Office of the Comptroller of the Currency (OCC), to invalidate an Oregon law that requires mortgage lenders to pay interest on the money they require borrowers to deposit into escrow accounts to cover taxes and insurance.
The result of the OCC’s decision would be to take money away from homeowners and put it right into the pockets of big banks.
“Time and again, we’ve seen the Trump Administration hand out favors to insiders and corporate special interests at the expense of Oregonians,” said Attorney General Rayfield. “This is a case in point: the Administration wants to let big banks pad their profits with money that, by law, belongs to Oregon families.”
In May 2026, responding to a request from banking lobbyists, the OCC issued a rule that claims to invalidate state laws – including Oregon’s – requiring lenders to share the money they earn on borrowers’ escrowed funds with the borrowers themselves. According to the lawsuit, the OCC’s rule ignores federal court rulings upholding state interest-on-escrow laws and skips the safeguards Congress put in place to prevent exactly this kind of bureaucratic overreach. If successful, the states’ case will wipe the OCC’s rule off the books and level the playing field between lenders and borrowers in Oregon.
It’s not just borrowers who lose out under the OCC’s rule. Because it only exempts national banks from Oregon’s interest-on-escrow law, smaller, state-chartered banks are left at a competitive disadvantage.
The case, States of Oregon & New York, et al., v. Office of the Comptroller of the Currency & Jonathan Gould, will be filed today in the U.S. District Court in Portland.
The lawsuit is led by Oregon Attorney General Dan Rayfield and New York Attorney General Letitia James, joined by the attorneys general of California, Connecticut, Maine, Maryland, Massachusetts, Minnesota, Rhode Island, and Vermont.
