Supreme Court Votes 9-0 to Uphold New York Law Requiring Banks to Pay Interest on Mortgage Escrow Accounts

The Supreme Court unanimously ruled May 30 that a New York State law that requires banks to pay interest on mortgage escrow accounts is not preempted by the National Bank Act. Although it did not happen in this case, when federal preemption takes place, this means that a state law that conflicts with federal law is invalid. The case is Cantero v. Bank of America. Justice Brett Kavanaugh wrote the court’s 9-0 opinion. The Supreme Court determined that the U.S. Court of Appeals for the 2nd Circuit failed to conduct a proper analysis of whether New York’s interest-on-escrow law was consistent with the Dodd-Frank financial reform law and existing precedent....