Pressure Mounts against Operation Choke Point (Oct. 15, 2014)
DOJ’s Operation Choke Point, which encourages financial institutions to scrutinize clients that process payments for certain types of businesses, continues to draw criticism from lawmakers and industry advocates, who argue that the policy is harmful to legitimate, legal businesses. Companies that want to air their complaints can do so through a special email address, email@example.com, created by U.S. Rep. Blaine Luetkemeyer (R-Mo.). The email address, announced last week, is hosted through the U.S. House of Representatives servers. Information will not be shared with regulators or other parties without express written consent, according Rep. Luetkemeyer.
“This platform was created so that if you own a business and have been affected by Operation Choke Point, you can share your story so I can continue to apply pressure to the Federal Deposit Insurance Corporation, the Department of Justice and other federal agencies that are applying unnecessary pressure on you,” Luetkemeyer said. He also encouraged regulators to share their stories of “abuse happening inside the administration.”
Choke Point critics suggest that federal regulators are using the policy to intimidate “unsavory” businesses, such as payday lending and money services businesses. Earlier this month the Third Party Payment Processors Association (TPPPA), a nonprofit industry association, filed an amicus brief in support of the Community Financial Services Association of America (CFSA) lawsuit against federal banking regulators to end Operation Choke Point and “the abuse of regulatory power.” In June, a House Oversight and Government Reform Committee published a report claiming the program was harmful to legitimate merchants and lacked legal authority.
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