The Obama administration was never shy about its targeting of industries it was not a fan of.
Case and point, the creation of the Consumer Financial Protection Bureau (CFPB), an organization which has primarily targeted financial intuitions the Obama administration wasn’t fond of. Throughout the CFPB’s existence industries such as banks, credit unions, and small dollar loan lenders have all been scrutinized and unfairly targeted by the Obama administration.
But recently released documents bring the targeting to a whole new level. Through a sneaky Department of Justice initiative called Operation Choke Point, other political foes of the Obama administration soon saw attacks that were beginning to cripple their existence.
Operation Choke Point essentially gave the Federal Deposit Insurance Commission (FDIC) autonomy to unfairly target industries it arbitrarily deemed to be “high risk.” These industries included firearms, fireworks, porn, small-dollar lenders, and tobacco product merchants. Again, all foes of the administration.
These newly released documents show just how far senior officials at the FDIC would go to ensure banks would not conduct business with these legal businesses. One FDIC director instructed his staff to use “available means, including verbal recommendations, to strongly encourage [supervised banks] to refrain from any activities that provide assistance to the business activities of [payday] lenders.”
Obviously, under this pressure and fear of retaliation, banks abruptly ended their relationships with these targeted industries. Many firearm manufactures and payday lenders were soon confused to why, without much explanation, they no longer had access to credit lines and bank accounts.
These new documents coupled with the CFPB’s unfair restrictions put on many other industries show just how far government entities can go to choke off certain industries it arbitrarily deems as political enemies. The government has done it before and it can certainly do it again.
Congress should be wary to continue to give agencies such as the CFPB (which barely has any congressional or executive oversight) too much power before it starts unjustly targeting industries based on personal bias and not sound facts.