A recent proposal by the Office of the Comptroller of the Currency (OCC), an independent bureau within the U.S. Department of the Treasury, would work to ensure fair treatment in lending and access to other financial services for American businesses. This is of particular importance to the Second Amendment, as manufacturers, companies and retailers in the shooting sports industries have and still are experiencing discrimination in getting these services from financial institutions.
Apparently, some of these financial institutions don’t like the work these businesses are engaged in, even though the work is legitimate and legal.
The OCC rule would “ensure fair access to banking services provided by national banks, federal savings associations and federal branches and agencies of foreign bank organizations. The proposal would codify more than a decade of OCC guidance stating that banks should provide access to services, capital, and credit based on the risk assessment of individual customers, rather than broad-based decisions affecting whole categories or classes of customers.”
Those “broad-based decisions” target companies in the shooting sports industries, including mom-and-pop gun shops that have seen loans and lines of credit denied despite their sterling financial histories.
At a November 2020 hearing of the U.S. Senate Committee on Banking, Housing and Urban Affairs, Sen. Mike Crapo (R-Idaho), Chairman of the Committee, said, “It is vitally important that our country’s financial institutions, especially the largest, not deny credit financing based on political preferences related to firearms, oil and gas or others. Lending decisions should be based on creditworthiness, and should not target specific industries, especially as we work to restore our economy to pre-pandemic strength.”
He also said, “This will remain an incredibly important issue for me, and I will continue to fight for access to credit and financial services for all of our legal industries.”
Several years ago, it first became apparent that shooting sports-based companies were being denied credit, and access to services like the ability to accept credit card payments, even though these businesses were granted such services previously and were rated as very credit-worthy.
And this discrimination was not accidental or the case of a poor decision by a bank here and there. Under the Obama administration, a plan was put into place known as “Operation Choke Point,” which directed financial institutions to discriminate against businesses in the firearms and other “sin industries.” As a result, law-abiding businesses have had accounts terminated, loans denied, and seen other actions taken against them.
The justification for these actions was that the firearms dealers and other legitimate businesses were too “risky,” financially and socially, and therefore should be denied various financial services.
In 2017, then-Attorney General Jeff Sessions abolished Operation Choke Point, but as the OCC proposal reflects, the discrimination still exists.
As Brian P. Brooks, OCC’s Acting Comptroller, wrote in a recentWall Street Journal opinion article: “Our office has heard [recent] concerns from Alaska’s congressional delegation that many banks were refusing to provide credit for oil and gas production, ostensibly reflecting a political opposition to drilling rather than the creditworthiness of individual customers.”
This OCC proposal “builds upon the fundamental principle of nondiscrimination and would prevent banks—alone or in coordination with others—from limiting fair access to banking services by preventing a business or person from entering, or limiting their ability to enter, a particular market, or disadvantaging a person to benefit another person or interest.”
Yet, as National Shooting Sports Foundation, the trade association for firearms manufacturers, recently confirmed to America's 1st Freedom, the discrimination against shooting sports businesses still exists today, and America's 1st Freedom will be exploring this discrimination in future articles. NRA-ILA has also been reporting on this issue.
In the meantime, OCC is accepting public comments on its proposal until January 4, 2021. The NRA encourages all firearm-related businesses that have been harmed by political discrimination in the provision of financial services to provide their respectful and constructive feedback on the proposal, and can do so via the Federal Rule Making Portal: Notice of Proposed Rulemaking Fair Access to Financial Services (occ.gov).