My latest article, co-authored with Stephen Gannon, calls for Congress to codify many of Trump’s executive orders related to bank regulation. Many of these orders restore due process, fairness and transparency to the banking rules, and should be made more permanent through legislation.
From the article:
In March, Sen. Tim Scott (R., S.C.) led the way by introducing the Financial Integrity and Regulation Management, or FIRM, Act. It would eliminate the vague term “reputational risk” as an element by which regulators might prevent banks from offering accounts to disfavored, though legal, businesses or people. Congressional action is needed because debanking has been resistant to reform. The Justice Department’s Operation Choke Point, initiated in 2013, aimed to investigate risky practices by financial institutions—and ended up debanking people and entities the Obama administration didn’t like. Last month, President Trump condemned the practice as “lawless” and “a disgrace.”
We have criticized this ugly practice in testimony before congressional committees. Operation Choke Point was a dangerous program that led to debanking of legitimate small businesses. Having the government decide which businesses and people a bank may serve has a chilling effect on the financial services industry. Debanking deprives lawful businesses of the financial oxygen they need to survive. If passed, the FIRM Act will eliminate the practice, we hope permanently.
Read the full article here.