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Missouri auditor seeks legislation for banking records

Tuesday, October 18, 2011 | 9:12 p.m. CDT

JEFFERSON CITY — Missouri Auditor Tom Schweich proposed legislation Tuesday to clarify the types of reviews his office can perform and to guarantee access to bank examination records.

The legislation sought by the auditor's office was part of a continuing dispute over access to bank examination records that Schweich contends is needed to finish an audit of the Missouri Division of Finance.

Earlier this year, Schweich subpoenaed records from the Division of Finance. The auditor's office and the state agency reached an agreement this summer to allow some records to be examined under conditions intended to protect the confidentiality of the documents. The Missouri Bankers Association has filed a lawsuit challenging whether the auditor's office has a right to the records and whether it can conduct performance audits that examine the operations of state agencies.

Online court records show that a preliminary restraining order was granted last.

Legislation sought by Schweich would expressly permit the state auditor to conduct performance reviews, allow access to the banking examination records and direct Schweich's office to complete a performance review of the Division of Finance. It also would bar employees from the Division of Finance from working for the banks the agency examines for two years.

Schweich, a Republican, said performance reviews are common both nationwide and in Missouri and are important for proper oversight. Schweich said his office would fight bankers' lawsuit, and he challenged the banking association to explain what it was seeking to hide and why it wanted to block the audit.

"If the Missouri Bankers Association are successful in shutting down performance audits, we will be the least fiscally accountable state in the entire United States of America. That is not an overstatement, that is a fact," Schweich said.

The Missouri Bankers Association said information in the examination records is confidential and needs to remain private. The association said examination reports can contain personal information about customers, loan application information and credit reports.

Max Cook, the bank association's president and CEO, said no amount of redaction and confidentiality promises are sufficient to guarantee that the information will stay private. He said it is unlikely Missouri residents want elected officials with political aspirations to have access to their private information, and he said the association will fight to protect banks and their customers.

"There is nothing to hide. We have the customers' best interest at heart in this," Cook said. "The auditor can accomplish his goals without having access to this confidential information. If all of a sudden, that information was in the public domain, our financial system could be wrecked."

The legislation proposed by Schweich would be considered by lawmakers when they return to the Capitol in January. The auditor cannot file measures for the Legislature to consider, but Rep. Sue Allen, a Republican from St. Louis County, said she planned to sponsor the proposal.


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