The issue of banks denying services to businesses within the firearms industry dates back at least to the Obama administration, if not before, and while there’s been some progress in recent years the problem still remains. Some states like Texas and Louisiana have shut financial institutions out of bidding on government bonds or services if they discriminate against the firearms industry, which has helped, but efforts to codify protections for gun-related businesses have been stymied on Capitol Hill because of the thin legislative majorities.
Now President Donald Trump is taking aim at those policies. In a new executive order entitled “Guaranteeing Fair Banking for All Americans”, the president is giving banking regulators 180 days to “remove the use of reputation risk or equivalent concepts that could result in politicized or unlawful debanking, as well as any other considerations that could be used to engage in such debanking, from their guidance documents, manuals, and other materials (other than existing regulations or other materials requiring notice-and-comment rulemaking) used to regulate or examine financial institutions over which they have jurisdiction.:
The Federal banking regulators shall also consider rescinding or amending existing regulations, consistent with applicable law, to eliminate or amend any regulations that could result in politicized or unlawful debanking and to ensure that any regulated firm’s or individual’s reputation is considered for regulatory, supervisory, banking, or enforcement purposes solely to the extent necessary to reach a reasonable and apolitical risk-based assessment.
The order also directs the Small Business Administration to, among other things, inform “all potential clients denied access to payment processing services provided by the financial institution” that they’re access to banking is being restored; while ordering the Treasury Secretary to “evelop a comprehensive strategy for further measures to combat politicized or unlawful debanking activities of financial regulators and financial institutions across the Federal Government, including consideration of legislative or regulatory options to eliminate such debanking.”
In a statement issued shortly after Trump’s executive order was officially released, the National Shooting Sports Foundation hailed the president’s move, declaring that the days of “woke banking” have come to an end.
“President Trump is yet again delivering on his promise to protect Americans’ rights. This time by ensuring that banks cannot discriminate against firearm-related businesses based on unaccountable corporate executives trying to impose a “woke” gun control agenda beyond what the law requires,” said Lawrence G. Keane, NSSF Senior Vice President and General Counsel. “American businesses, and firearm businesses in particular, must have fair access to essential banking services that are based on an objective criteria and creditworthiness. Politics should not enter into a bank’s lending decision. NSSF is encouraged that President Trump is today putting an end to ‘woke banking.’”
Let’s hope so, anyway. As NSSF notes, while the debanking first emerged as an issue during the Obama years with Operation Choke Point, where the DOJ and FDIC put pressure on banks to stop doing business with industries that had “reputational risk” (including the firearms industry), during Trump’s first term many financial institutions decided to privately implement these discriminatory practices or keep them in place.
In the waning days of the first Trump administration the Office of the Comptroller of the Currency proposed a Fair Access to Banking rule that also would have ended this discrimination, but one of the first acts of the Biden administration was to halt the proposed rule before it could become effective.
Congress still needs to codify these prohibitions, but until that happens Trump’s executive order should be of immense help to companies who’ve been denied access to various financial services from some of the biggest players in the banking industry. These companies won’t be singled out for special treatment, but no longer will they be pariahs in the world of payment processors and lending institutions. A level playing field is all they’ve been asking for, and that’s what Trump’s EO should deliver.
Editor’s Note: President Trump and his cabinet are taking historic steps to protect our Second Amendment rights and right to self-defense.
Help us continue to report on their efforts.. Join Bearing Arms VIP and use promo code FIGHT to get 60% off your VIP membership.
Read the full article here
