OCC Proposal Comments Close Tonight

The Office of the Comptroller of the Currency has proposed a regulation that would ensure fair access to banking and credit services. The regulation would ban things like the Obama Administration’s Operation Chokepoint which sought to cut off banking services to disfavored industries.

In the greater scheme of things, this regulation is more important for the health of the firearms industry than the recent ATF moves on pistol braces and 80% lowers/frames. Without access to credit and banking services, the firearms industry would have a hard time existing as would any business.

In its proposal, the OCC notes that certain non-quantitative risk measures have been used by banks to deny financial services.

The pressure on banks has come from both the for-profit and nonprofit sectors of the economy and targeted a wide and varied range of individuals, companies, organizations, and industries. For example, there have been calls for boycotts of banks that support certain health care and social service providers, including family planning organizations, and some banks have reportedly denied financial services to customers in these industries. (8) Some banks have reportedly ceased to provide financial services to owners of privately owned correctional facilities that operate under contracts with the Federal Government and various state governments. (9) Makers of shotguns and hunting rifles have reportedly been debanked in recent years. (10) Independent, nonbank automated teller machine operators that provide access to cash settlement and other operational accounts, particularly in low-income communities and thinly-populated rural areas, have been affected. (11) Globally, there have been calls to de-bank large farming operations and other agricultural business. (12) And companies that operate in industries important to local economies and the national economy have been cut off from access to financial services, including those that operate in sectors of the nation’s infrastructure “so vital to the United States that their incapacitation or destruction would have a debilitating effect on security, national economic security, national public health or safety, or any combination thereof.”  (13)

The National Shooting Sports Foundation is fully in favor of this proposed regulation. They note it doesn’t force banks to do business with businesses. Traditional credit worthiness measures as debt ratio, payment history, and ability to pay will remain in place. They go on to say this proposal will level the playing field by forcing banks to treat all businesses equally and fairly without consideration of banking executives’ personal political preferences.

The rule will apply to the largest banks in the country that may exert significant pricing power or influence over sectors of the national economy. It would require those banks to make their products and services available to all customers in the community it serves, based on consideration of quantitative, impartial, risk-based standards established by the bank.

In other words, banks would be required to approve or deny their services based on merit and creditworthiness of individual borrowers. That would remove the “reputational risk” mask that banks hide behind when they force businesses to adopt gun control policies that are beyond the scope of federal, state and local laws or lose access to banking services.

Comments on OCC-2020-0042-0001 closes tonight at 11:59pm Eastern.

To make a comment, use this link: https://www.regulations.gov/comment?D=OCC-2020-0042-0001

As of this morning, they have received only 4,272 comments. There have been comments opposing it from gun control supporters as well as environmental groups such as the Natural Resources Defense Council.

I made a comment and I hope you take a few minutes to do so as well.


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