WASHINGTON—Trade groups representing both banks and credit unions have sent a letter to the Senate expressing “strong support” for an amendment proposed by Sen. Mike Crapo (M-ID) to the Senate Budget Resolution for Fiscal Year 2016 that will establish a deficit-neutral reserve fund to end the Department of Justice “Operation Choke Point.” The amendment passed in a committee by a 13-9 margin.
“Credit unions and banks are committed to maintaining their ability to serve their members and customers, while also strictly adhering to all laws and regulations that govern those services,” said CUNA, NAFCU, the Independent Community Bankers Association and the American Bankers Association in the letter. “We support and have a long history of partnering with the federal government in fighting fraud and ensuring the integrity of financial markets; nevertheless, we are concerned that Operation Choke Point’s broad enforcement tactics could undermine effectiveness and create risks to consumers and the economy. Operation Choke Point activities have resulted in some financial institutions suspending access to financial services for certain legal businesses.
“Senator Crapo’s amendment would in no way inhibit the enforcement of anti-fraud laws,” the letter continues. “All of the requirements of the Bank Secrecy Act and other anti-fraud statutes would continue in force and effect just as they did before the initiation of Operation Choke Point. Banks and credit unions have a long history of partnership with law enforcement agencies and in complying with the law. The amendment would prevent the Department of Justice from pressuring a depository financial institution into terminating a specific member/customer account or to otherwise discourage a depository institution, such as a bank or credit union, from entering into or maintaining a financial services relationship with legitimate member/customer. We strongly believe that before a law enforcement agency or regulator requires that a relationship be terminated with a credit union member or bank customer, the law enforcement agency or regulator must have and provide to the credit union or bank a material reason clearly related to a specific violation of the law. We urge the Committee to adopt Senator Crapo’s amendment.”