Senators Urge FDIC to End Choke Point Practices
November 8, 2018
Months after the Trump administration ended Operation Choke Point -- an Obama-era policy that sought to curtail disfavored businesses by working through regulators to pressure banks into ending customer relationships -- a group of 13 Republican members of the Senate Banking Committee wrote to FDIC Chairman Jelena McWilliams yesterday calling on the FDIC to ensure that these practices are discontinued. The lawmakers raised concerns over recently released internal FDIC documents suggesting that banks have been verbally encouraged to curtail business relationships with disfavored but legal industries.
Specifically, the senators called on the FDIC to “review all options available to ensure lawful businesses are able to continue to operate without fear of significant financial consequences. They also asked the agency to review how it communicates policy internally.
“There is no place for a political agenda in oversight of the banking system. Operation Choke Point, and its associated culture and Choke Point-like regulatory actions, must end once and for all,” they said. “This should not be a partisan issue: no administration -- Republican or Democratic -- should be able to use the administrative state to silence industries they do not like.” Read more.