House Conservatives Want End to Obama’s Chokehold on Gun Dealers

(Joshua Paladino, Liberty Headlines) In February 2013, President Barack Obama’s Department of Justice began issuing subpoenas to banks that provided financial services to firearm dealers, without evidence of wrongdoing.

Bob Goodlatte photo

Bob Goodlatte Photo by Gage Skidmore (CC)

The subpoenas contained warnings from the Federal Deposit Insurance Corporation (FDIC) that marked these businesses “high risk,” which was enough for some banks to cut off financial services.

This plan to sink firearm retailers, along with payday lenders and other supposedly “high risk” businesses, is called Operation Choke Point, and it’s still in effect today.

But a group of House members, led by Judiciary Committee Chairman Bob Goodlatte, wrote Attorney General Jeff Sessions and Federal Reserve Chair Janet Yellen and asked for the anti-gun policy to end.


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Goodlatte said the FDIC’s decision to arbitrarily label certain legal businesses as “high risk” created a “guilty until proven innocent” scenario.

“Ordinarily speaking, law enforcement moves from the specific to the general. A bad actor is identified and then gradually the net widens to capture co-conspirators or a larger criminal enterprise. OCP started by presuming a whole industry guilty until individual merchants prove their innocence,” he wrote.

In 2014, The Washington Times reported about a Massachusetts gun seller who was targeted by OCP. Mark Cohen, the owner of Powderhorn Outfitters, said the bank he had always used — TD Bank — dropped his account because of OCP.

“Our loan was turned not because of our credit — we had perfect financials and been working with the same bank manager for 20 years. It was just because we sell guns — and they said that to us specifically,” Cohen said, according to the Times.

The FDIC admitted to unfairly labeling certain legal businesses as “high risk” back in 2015 and instead advised financial institutions to take “a risk-based approach in assessing individual customer relationships rather than declining to provide banking services to entire categories of customers,” Forbes reported.

A Maryland gun seller, Kat O’Connor, said she was denied credit card services in 2014, according to The Blaze.

“I believe the failure of Congress to enact strict gun control led to this method of starving manufacturers out of business,” O’Connor said. “I also believe this is an unfortunate abuse of power. Sadly, I don’t see how this is any different than a mafia-style shakedown, promising to leave banks and card processors alone if they ‘play along’ by foregoing money from certain industries, regardless of their legal status.”

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Goodlatte said the DOJ and FDIC have not done enough to reverse the harm caused by OCP, and he has called for them to affirm a neutral stance toward legally operating businesses. Specifically, he asked the FDIC to “rescind its general guidance about reputation risks posed by bank customers” and to retract “its assertion that the industries it had listed are particularly high risk.”

Rep. Blaine Luetkemeyer (R-Mo.), who also signed the letter, said to Forbes, “The FDIC has allowed a culture within their agency to blossom that they believe it’s okay to impose their personal opinions and value system in a regulatory way. They are not a regulatory police—their job is to enforce the law.”

Goodlatte and the letter’s signees asked for a plan to remedy OCP’s harms by August 31.