March 28, 2019

Crapo Warns Banks Against Cutting Ties to Politically Disfavored Industries

WASHINGTON – Recent news reports have suggested that large banks are being pressured to withhold access to credit and services to customers and companies that are operating businesses that comply with federal and state law (and, in some cases, are engaged in Constitutionally-protected activities), but are politically disfavored.  

As Chairman of the Senate Banking Committee, Idaho Senator Mike Crapo sent letters to eight bank CEOs reminding them that they should continue to provide credit and services to customers and companies that comply with federal and state law, and should not seek to replace legislators and policymakers. 

“Banks serve customers who are geographically and politically diverse, and it is wrong to use essential banking services as a way to choke off such services to lawful, creditworthy businesses,” wrote Crapo.  “Large banks, which receive significant forms of government support and benefits, should continue to provide credit and services to customers and companies that comply with federal and state law and should not seek to replace legislators and policymakers.  Business lending decisions should be based on creditworthiness, rather than politics or political pressure.” 

Crapo has challenged banks in the past for issuing guidelines that could effectively cut off financial services to law-abiding firearm manufacturers, retailers and firearms purchasers if they do not comply with the bank’s firearms preferences.  Likewise, during the Obama Administration, he fought against “Operation Choke Point,” an initiative in which Federal agencies pressured banks to “choke-off” politically disfavored industries’ access to payment systems and banking services.  The issue continues to be a major focus of ongoing Banking Committee oversight efforts.

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