Federal bureaucrats are pressuring banks and credit unions to close accounts for gun shops and other law-abiding businesses in an attempt to shut down those enterprises. That is the charge a US Congressman and others are making about a US Department of Justice effort called Operation Choke Point.
“They figured that if they could cut off legal businesses’ ability to bank they could put those businesses that they don’t like out of business,” US Representative Sean Duffy (R-Wisconsin) said of Choke Point.
Other critics agree.
“This is one of the greatest abuses of power that the country has never heard of,” Brian Wise of the US Consumer Coalition told Fox News. Wise believes that federal officials pressured banks and credit unions into closing hundreds or thousands of bank accounts.
Duffy alleged that Choke Point started as a legitimate effort to target fraudsters but it is now targeting legal businesses that federal bureaucrats find distasteful. Fox News reporter Mike Tobin labeled Operation Chokepoint the morality police.
Credit Union Afraid To Do Business With Gun Shops
Bank and credit union officials say they are afraid to work with owners of gun stores, pawnshops, check-cashing stores and other businesses federal investigators disapprove of. Mike Schuetz, the owner of the Hawkins Guns store in Wisconsin, found this out the hard way when a manager at the Heritage Credit Union called him in and told him his account was closed.
“We don’t do firearms, ammunition, auctioneers and check-cashing unions,” a Heritage Credit Union branch manager said in a recording Schuetz made.
Tobin alleged that federal bank regulators have a list of businesses that includes gun stores, pawnshops, check-cashing establishments, legal marijuana sellers, payday lenders and other legal businesses they find distasteful. The legal businesses are lumped together with criminals such as con artists and pimps. If the regulators find that such businesses have accounts at a financial institution, the institution is subject to increased audits and investigations until the accounts are closed, Tobin charged.
Several business people, including an ammunition dealer, firearms dealers, a short-term lender and a check casher, told Tobin that their accounts had been closed because of Operation Choke Point. The effort has been going on for at least a year; last May, Off The Grid News reported that a Miami gun dealers’ account had been closed because of Choke Point.
“We’re being threatened with a regulatory regime that attempts to foist on us the obligation to monitor all types of transactions,” Richard Riese of the American Bankers Association told American Banker last year. American Banker alleged that the effort began in March 2013 with subpoenas to banks and payment-processing organizations.
The DOJ says it’s not going after gun shops.
“We do not target businesses operating within the bounds of the law, and have no interest in pursuing or discouraging lawful conduct,” Emily Pierce of the Department of Justice told Fox News.
“That’s a bald-faced lie,” Duffy said of Pierce’s statement.
A DOJ memo seems to back up Duff’s allegations. It reads: “Although we recognize the possibility that banks may have therefore decided to stop doing business with legitimate lenders, we do not believe that such decisions should alter our investigative plans,” the director of the department’s Consumer Protection Branch, Michael Blume, wrote in the memo.
If You Can’t Bank, You Can’t Do Business
“What they’ve done is they put short-term lenders out of business, gun dealers out of business, ammunition manufacturers out of business,” Duffy said, “because in America, if you can’t bank, you can’t do business.”
Some of the entrepreneurs targeted, including Schuetz, have been able to open accounts at other banks. Unfortunately, Duffy thinks the Justice Department will simply target those banks, too.
“They might be able to get banked for a short time, but once that bank goes through its next examination, Hawkins Guns might find itself without a bank,” said Duff, adding he wants to hold Congressional hearings into Operation Choke Point.
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