Monday marked the close of a 45-day window for the public to comment on a proposed rule offered by the Office of the Comptroller of the Currency that would have a significant and beneficial impact on the firearms industry, but senior officials with some of the largest financial institutions in the country are still speaking out in opposition to the measure, which would curtail their ability to discriminate against disfavored sectors of the economy like the firearms industry.
More than 6-thousand public comments were received by the agency, and over the last few weeks there’s been a surge in support for the rule change on the part of gun companies, oil and gas corporations, and even individual gun owners, as but Bloomberg’s Jesse Hamilton reported on Tuesday, the big banks are making their voices heard as well.
The “fair access” rule proposed by the Office of the Comptroller of the Currency on Nov. 20 would create undue burdens for lenders and could threaten their business models, banking industry groups said in comment letters to the agency. The industry groups also challenged OCC’s authority to issue the rule and argued that the 45-day comment period that ended Monday gave them insufficient time to respond.
Brian Brooks, the OCC’s interim chief, wants to bar banks from refusing to serve legal businesses — such as those in the oil, prison and firearms industries — that they might otherwise avoid because of the potential for reputational harm. Under the rule, a bank must conduct a risk assessment on any prospective customer, and can’t refuse the business so long as the numbers are sound.
The OCC’s effort was initiated after Republican lawmakers complained about banks declining to finance energy projects, citing climate-change concerns. Lenders including Citigroup Inc. and Bank of America Corp. have also limited ties to the gun industry.
As Hamilton notes, the first attempt to blackball the gun industry from large financial institutions came during the Obama era with the implementation of Operation Choke Point, which pressured banks into dropping customers that were involved in a number of different industries from firearms to payday lenders. When Congress managed to shut down that program, many of those same banks decided that they’d continue the practice on their own, which is what ultimately led to the proposed rule change now under consideration.
Now the question is whether the rule will be adopted before time runs out. When I spoke to National Shooting Sports Foundation senior vice president and general counsel Larry Keane for today’s Cam & Co, he noted that the acting head of the OCC only has a couple of weeks to put the rule in place, but he sounded optimistic that it would get done. We’ll be watching closely to see what happens with the proposal between now and January 20th and keeping our fingers crossed in the meantime.