Operation Choke Point and the Consumer Financial Protection Bureau
Warren's CFPB: This Is Progress? The American Arbitration Association was established nearly a century ago in 1926 to
provide such arbitration services, under well-established rules of due process. Today, more disputes are settled through such
private dispute resolution services than through all the federal and state courts combined. But progressives are certain they
know better. Earlier this month, the Consumer Financial Protection Bureau (CFPB) issued a ruling barring contractual, mandatory
arbitration clauses for class action lawsuits. That means parties to a contract can no longer agree to arbitration for such
suits. Sen. Elizabeth Warren, D-Mass., was the intellectual godmother of the CFPB, established in the Dodd-Frank
legislation of 2010. She carefully designed it so that it constitutes a thorough violation of the Constitution's separation
of powers doctrine, not answerable to the president, the Congress, or even another so-called independent agency.
Cordray: Poster Child For Bureaucrats Behaving Badly. Americans disagree on how much government is too
much. That is not surprising; we live in a diverse country. But, a common thread — that links us
all — is fairness. We expect it, and when it is taken away, we fight back. The Consumer Financial
Protection Bureau (CFPB) was created to protect Americans, but it's structural flaws and blatantly ambitious leader doomed it
from Day One. A recent poll revealed 75 percent of Americans surveyed believe financial regulators, like Richard
Cordray — Director of the CFPB, care more about their own jobs and ambitions than our nation's economic well-being.
Mr. Cordray leads a massive — and growing — federal bureaucracy that reports to no one.
Not to a board, not to the President of the United States, and certainly not to the American people.
Consumer Financial Protection Bureau's Richard Cordray thinks he's above the law — no surprise since his
Pelosi-created agency is too. Everyone knows you can't run for governor of Ohio and head up an agency of the
United States government at the same time. Then why is Richard Cordray, the Director of the Consumer Financial
Protection Bureau (CFPB), doing just that? It was recently reported that a state judge in Ohio by the name of Bill
O'Neill was asked by a friend of Cordray's if he would stay out of the race for governor if Cordray became an official
candidate. This is a campaign maneuver that's regularly employed in order to mitigate headaches in an upcoming
race. In this case, Cordray is trying to limit the number of primary challengers he would face in the upcoming
Democrat primary election next spring.
Heritage Budget Wants to Ax
Federal Housing Administration, Consumer Financial Protection Bureau. The firing of a federal employee takes
about 18 months on average, given the appeals process, which allows multiple avenues for an employee to register
complaints. This was one of the central issues discussed Tuesday [8/22/2017] at the Heritage Foundation, where members
of the conservative think tank outlined the organization's Blueprint for Reorganization. [...] Suggestions include the
elimination of entire offices like the Federal Housing Administration and the Consumer Financial Protection Bureau. It
also envisions consolidating Veterans Affairs, which has 42 offices specifically focused on health benefits, a setup that
was described Tuesday [8/22/2017] as a "bureaucratic nightmare" for veterans.
DOJ ends Holder-era 'Operation Choke Point'. The Trump Justice Department is ending an Obama-era program that
had attempted to cut off credit to shady businesses but came under fire from Republicans for unfairly targeting gun dealers
and other legitimate operations. Just days after top House Republicans had pressed Attorney General Jeff Sessions to
shutter Operation Choke Point, the department confirmed in a response letter that the program is dead. "All of the
Department's bank investigations conducted as part of Operation Chokepoint are now over, the initiative is no longer in
effect, and it will not be undertaken again," Assistant Attorney General Stephen Boyd said in the Aug. 16-dated letter,
calling it a "misguided initiative" from the prior administration.
CFPB Rule Legislates False Data to Help Trial Lawyers. As if further evidence were needed, last week, the Consumer Financial Protection
Bureau (CFPB) demonstrated why it needs to be eliminated. It announced a new rule that, if not overturned, will upend an effective way of
addressing consumer claims against financial institutions, potentially flood the courts with cases, and increase costs to customers. While
getting rid of the CFPB may be a long-term project, Congress has a way to swiftly undo this new rule through the Congressional Review Act (CRA).
It should do so before the rule comes into effect.
CFPB Supervision Problem. On June 12, 2017, the Treasury Department issued a 149-page report proposing reforms
to the Dodd-Frank Act of 2010, many of which were in the Financial CHOICE Act that House Republicans had passed a week
earlier. Most of the proposed revisions to the 2010 law, enacted while Democrats controlled Congress and the White
House, concern technical measures designed to prevent a repetition of the 2008 financial meltdown. The most
controversial proposals involve the Consumer Financial Protection Bureau. While the CFPB was not essential to the goal
of preventing economic crises, a modest federal agency dedicated to curbing financial-industry fraud, like the one Senator
Elizabeth Warren first advocated as a law professor in a 2007 article, might have provided welcome enforcement of consumer
financial laws that had been neglected by state agencies and solvency-focused bank regulators.
Trump Wants Power to Fire the Head of the Consumer Financial Protection Bureau. When PHH Financial, a mortgage
lender, was fined $109 million by the head of the Consumer Financial Protection Bureau (CFPB), it filed suit against the
agency for overreaching its prerogatives. It also demanded that the court dismantle the agency altogether. A
three-judge panel of the U.S. Court of Appeals for the District of Columbia ruled last fall that, indeed, Richard Cordray,
the CFPB's director, did overreach, but that dismantling the agency was itself too much to ask. Last Friday Trump's
Department of Justice (DOJ) made an unusual move in the case, which has been appealed to the full bench by filing an amicus
brief. Said DOJ officials: "Because a single agency head is unchecked by the constraints of group decision-making
among members appointed by different presidents, there is a greater risk that an 'independent' agency, headed by a single
person, will engage in extreme departures from the president's executive policy." This is how a lawyer complicates the
simplest thing: The CFPB's head is not accountable to anyone. Its funding comes from the Federal Reserve where
the agency is housed. Cordray cannot be fired, except for the grossest mismanagement. He is, in other words,
immune from any oversight by the president, Congress, or the courts. He is a rogue head of a rogue agency.
Cruz Introduces One-Line Bill To Abolish Warren's Consumer Agency. Texas Republican Sen. Ted Cruz
introduced a two-page bill Tuesday to abolish the Consumer Financial Protection Bureau, the darling of Sen. Elizabeth
Warren and Bernie Sanders. The Repeal CFPB Act, which Cruz and four other Republican senators sponsored, would repeal
the Consumer Protection Act of 2010, the part of the Dodd-Frank bill that created the CFPB and granted it sweeping authority
over banks, money lenders and financial institutions. "Don't let the name fool you, the Consumer Financial Protection
Bureau does little to protect consumers," Cruz said in a statement.
Warren's Secrets and Lies. [T]he CFPB has spent the last five years stonewalling congressional oversight and document requests.
Bipartisan commissions are internally transparent, meaning a restructuring would give even minority Republican commissioners access to confidential
CFPB inspector-general reports, employee files, and internal e-mails and documents. Senator Warren's reputation rests largely on the CFPB, and she
knows what the bureau is hiding. She'd like to keep those secrets hidden until her reelection to the Senate in 2018 — and perhaps a bigger
race in 2020.
Train Flows Wide And Deep At Elizabeth Warren's Consumer Agency. Pay is flowing so generously at the Consumer
Financial Protection Bureau (CFPB) that hundreds of bureaucrats there receive more than most members of Congress. [...]
Speaker of the House Paul Ryan of Wisconsin receives $223,000 per year, but that's less than what 54 CFPB employees are
paid. Another 170 CFPB employees earn more than the secretaries of defense and state, the attorney general and the
director of national intelligence. All cabinet salaries are capped at $199,700, but not at the bureau.
Tragic Downfall of the Consumer Financial Protection Bureau. On October 11, 2016, in PHH Corp. v. Consumer Financial
Protection Bureau, a three-judge panel of the D.C. Circuit Court of Appeals found the CFPB's structure unconstitutional and "fixed" it
by empowering the president to remove the agency's director at will. It sounds dull, but this is a tragic story.
Utterly Unconstitutional. Two months ago, the US Court of Appeals for the DC Circuit officially ruled that the
structure of the Consumer Financial Protection Bureau (CFPB) is unconstitutional, a criticism that has been leveled at the
agency since its creation in 2010. The court found that so much unaccountable power was concentrated in the person of the
director of the CFPB that it could not pass constitutional muster. Under the court's ruling, the director now will be
removable at will by the president, just like the head of any other agency. This represents an important blow for the
system of separation of powers enshrined in the US Constitution.
Is The Most Partisan Agency In The Entire Federal Government, According To FEC Records. And the award for most
partisan federal government agency with the most donations to Democrats goes to ... the Consumer Financial Protection Bureau
(CFPB). According to campaign finance data released Thursday, employees of the bureau — created under the
watchful eye of liberal Massachusetts Sen. Elizabeth Warren — gave 100 percent of its donations to Democratic
candidates in 2016, with $50,000 of political aid money divided between Hillary Clinton and independent Vermont
Sen. Bernie Sanders, who battled it out for the Democratic presidential nomination.
100% of CFPB Donations
Went to Democrats. The Consumer Financial Protection Bureau is the most partisan agency in the federal
government in terms of donations to candidates, according to campaign finance data. Employees at the CFPB, which was
created by the Dodd-Frank Wall Street Reform and Consumer Protection Act, contributed nearly $50,000 during the 2016 campaign
with all of that money going to aid Hillary Clinton or her rival, the insurgent socialist Sen. Bernie Sanders (I., VT).
Agency employees made more than 300 donations during the campaign. Not one went to a Republican candidate.
Out-Of-Control Consumer Financial Protection Bureau Gets Its Wings Clipped. A U.S. appeals court took a small
step to restoring constitutional order to the federal government on Tuesday when it issued a blistering decision which found
that the design of the Consumer Financial Protection Bureau was unconstitutional. Unfortunately, the court left this
dangerous agency otherwise intact. It's not too much of an exaggeration to describe the CFPB as the Frankenstein's
Monster of federal regulatory agencies. When Democrats breathed life into it as part of the Dodd-Frank financial reform
law, they created a bureau that — by design — was almost entirely unaccountable to the public.
Congress has no control over its funding — the money comes from the Federal Reserve. Its regulatory reach is
vast. And its sole director could only be removed by the president for cause.
the Postal Service Handle Your Loans as Well as Your Mail? Elizabeth Warren Thinks So. The Consumer
Financial Protection Bureau is inching closer to eliminating private payday lending with restrictive new rules and, some
advocates hope, paving the way for the U.S. Postal Service to take over these banking services. The agency's liberal
supporters, including Sen. Elizabeth Warren, D-Mass., long have wanted to replace the payday lending industry with a
government-run alternative. Now, they are pushing to include language in the Democratic Party platform to add banking
to the line of services provided by the U.S. Postal Service. The 2010 Dodd-Frank Act granted authority to the Consumer
Financial Protection Bureau to regulate and restrict short-term credit providers and payday lenders.
Wells Fargo Case: This is Consumer Protection? Recent news that Wells Fargo employees had opened as many
as two million unauthorized customer bank and credit card accounts since 2011 was shocking. The bank fired 5,300
workers and agreed to pay $185 million in fines to the Los Angeles City Attorney, the Comptroller of the Currency, and the
Consumer Financial Protection Bureau. The CFPB's media blitz reduced the other two agencies to bystanders. The
CFPB has been more political theater than good government since then-law professor Elizabeth Warren prodded the Democratic
president and Congress to create the bureau in the 2010 Dodd-Frank law. The law insulated the new agency from
Republican participation through a single director structure and funding independent of the congressional appropriations
process. Warren was elected Massachusetts's senator. The CFPB quickly became a single-party, clandestine
organization whose top priority is self-promotion.
Consumer Financial Protection Bureau is still unaccountable. Four years ago, the
big-government liberals got the agency of their dreams, the Consumer Financial Protection Bureau. It
was the brainchild of Sen. Elizabeth Warren, who was a Harvard law professor in real life and a
Cherokee Indian in her dreams before she was elected to the U.S. Senate. There she beats the drums
for the bureau to serve as a "cop on the beat" to protect consumers from undisciplined capitalism.
The bureau is mired in undisciplined corruption. Created through the passage of the Dodd-Frank
Wall Street regulation act, the bureau was crafted with uniquely undemocratic features. The bureau
pays its bills by drawing funds directly from the Federal Reserve, bypassing Congress. It was set up
this way to ensure it would operate as a fiefdom free from congressional scrutiny, and it shows.
for fairness in all the wrong places. What the Consumer Financial Protection Bureau
really does is anyone's guess. [...] Consider it an outreach program that brings Occupy Wall Street into the halls of power.
The CFPB was the brainchild of Sen. Elizabeth Warren when she was just a lowly socialist Harvard
professor. Now she is the senator from Taxachussetts. When she was campaigning for that position,
she came up with the slogan later borrowed by President Obama to make the rich feel guilty for
their success: "There is nobody in this country who got rich on his own."
Presidential Candidate Elizabeth Warren at Center of CFPB Scandal. Possible
presidential candidate Sen. Elizabeth Warren (D-MA), who came up with the idea and led the
start-up of the "Consumer Financial Protection Bureau" as a federal watchdog to prevent financial
institutions from abusing U.S. consumers, is now at the center of the a scandal regarding the
vanished authorization to spend $215.8 million on a luxurious remodel that included a new
penthouse floor and indoor waterfall for the bureau's rented Washington, D.C. office space.
The Office of Inspector General of the United States Federal Reserve (OIG) was requested by the
House Financial Services Oversight and Investigations Committee on January 29, 2014, to
evaluate the Consumer Financial Protection Bureau's (CFPB) headquarters renovation costs that rose
from $55 million to at least $215.8 million.
Four Pinocchios: Warren's
false claim that 'auto dealer markups cost consumers $26 billion a year'. Sen. Warren
has long objected to Congress's decision to exempt automobile dealers from the Consumer Financial
Protection Bureau, which she helped set up as an adviser to the Obama administration. In a
recent speech, she indicated that she will push Congress to eliminate this exemption and allow the CFPB
to supervise loans made by car dealers.
Choke Point asphyxiating payday lenders. Greg Palmer and his partner opened their first Dollar Smart store in
Oxnard, California, in 1999, eventually growing into a seven-shop chain that employed 75 people, providing payday lending,
auto financing loans, wire transfers and money orders to the unbanked community. Fifteen years later he says they ended up
in the crosshairs of the Obama administration's Operation Choke Point, with their main bank account closed and no other banks
willing to take their business. The Federal Deposit Insurance Corporation had put the word out that payday lenders, along
with gun stores and more than two dozen other industries, were undesirables.
buy the spin — Operation Choke Point targets legal businesses. All Americans,
entrepreneurs and small businesses across our great country come from very different walks of life.
They have taken great risks and share a common dream to start a company that can one day become profitable
and provide for their families. Although businesses face incredible hurdles before they succeed, the
ones that do survive provide the foundation for our local communities. Unfortunately, the most alarming
hurdle facing businesses today is a Department of Justice initiative known as Operation Choke Point.
Supply Chain Choke Point? David Codrea gives a rundown of the recent actions by the ATF on the ammunition
supply chain. "ATF was recently asked about the status of nitrocellulose under the Federal explosives laws and
regulations," the Bureau of Alcohol, Tobacco, Firearms and Explosives noted in its... industry newsletter. "'Nitrocellulose
explosive' is on ATF's List of Explosive Materials." Who did the asking — and what their motives were —
was left unsaid. [...]"
Judges Question Constitutionality Of Obama's Prized Consumer Agency. A federal appeals court appears ready to
declare the structure of the Consumer Financial Protection Bureau (CFPB) unconstitutional, a major blow to the first new
agency created under President Barack Obama. The possibility of dramatic action against CFPB arose in an oral argument
Tuesday [4/12/2016] before the U.S. Court of Appeals for the D.C. Circuit.
Choke Point, Bank De-Risking, and Obama Administration Coercion. For all his faults, you have to give President
Obama credit for strong convictions. He's generally misguided, but it's perversely impressive to observe his relentless
advocacy for higher taxes, bigger government, more intervention, and limits on constitutional freedoms. That being
said, his desire to "fundamentally transform" the United States leads him to decisions that run roughshod over core principles
of a civilized society such as the rule of law. Consider, for instance, the Obama Administration project, known as
"Operation Choke Point," to restrict banking services to politically incorrect businesses such as gun dealers.
Top Obama Official Says Operation Choke Point Had 'Collateral' Consequences. One of President Barack Obama's former
top Justice Department officials behind Operation Choke Point said Thursday [4/7/2016] the program had "unintended but collateral
consequences" on banks and U.S. consumers. "Unfortunately, as the investigations continue, so too have one of the unintended but
collateral consequences of such vigilance: mass de-risking," wrote Michael J. Bresnick, who previously served as executive
director of Obama's Financial Fraud Enforcement Task Force, under which Operation Choke Point was created. "Members of the
industry have raised their hands in frustration and simply avoided lines of business typically associated with higher risk.
This reaction to [the Justice Department's] enforcement initiative, and similar matters brought by the Federal Trade Commission and
the Consumer Financial Protection Bureau, is certainly understandable."
Out If Your Lawmaker Voted to End Operation Choke Point. The House of Representatives concluded a tense debate Thursday [2/4/2016]
by voting 250-169 to end a controversial Obama administration program called Operation Choke Point. Critics say the secretive program,
run by the Department of Justice, has been used to target politically unpopular industries such as gun sellers. [...] Operation Choke Point was
launched by the Justice Department in 2013 as a way to fight fraud by pressuring banks to "choke off" access to credit and other banking services
by merchants and industries the administration considered at a high risk for fraud. Without access to banking services, it is
difficult — if not impossible — for a business to survive.
accused of blocking legal gun shops, other businesses from banking. Mike Schuetz
operates a small gun shop in northern Wisconsin called Hawkins Guns. In November, just before one of
his peak selling times, his local credit union notified him his account needed to be closed.
"The bank manager said they made a mistake, and they were not supposed to open accounts for those
people involved in high-risk industries, which the gun industry and ammunition industry is one of
those," Schuetz said. It turned out there was a list created by a Justice Department program
called Operation Choke Point.
Gingrich: Choke Point 'Is the Beginning of a Real Tyranny in the United States'. In an
exclusive interview with The Daily Signal, Newt Gingrich called the Justice Department's Operation
Choke Point, "the beginning of a real tyranny in the United States," and said the whole program
needs to be dismantled. "I don't think the average American realizes that the bureaucrats have
come up with a model, which could kill any industry, kill any business, and do so even though what
it was doing was totally legal," he said while attending the 2015 Conservative Political Action
Conference (CPAC) on Friday [2/27/2015]. "I think that's very frightening for our future."
Admin Tells Banks To Shut Up About Its Targeting of Consumers, Gun Dealers. The Obama
administration's Consumer Financial Protection Bureau is threatening banks to be silent about the
administration's new programs supervising and investigating private bank account holders. A
shocking bulletin that CFPB issued to banks, which was obtained by The Daily Caller, was sent around
this week in the midst of controversy regarding the administration's Operation Choke Point program,
by which the administration pressures banks to cut off accounts for supposedly suspicious businesses,
including gun dealers.
Point Draws Heat From Gun Industry. Banned from financial services that are essential
to running a business, firearms sellers attending the world's largest gun show last week in Las
Vegas spoke out against the government's controversial program known as Operation Choke Point.
"We continue to hear from dealers and others in our industry that suddenly, out of the blue, they
have been cut off by financial services or credit card processors or banks," said Larry Keane,
Senior Vice President of the National Shooting Sports Foundation.
Pressure Credit Union to Close Wisconsin Gun Dealer's Bank Account. A gun dealer in
Hawkins, Wisconsin says the federal government forced the Heritage Credit Union to close his
recently opened bank account because he's in the business of legally selling guns. Mike Schuetz,
the owner of Hawkins Guns LLC, a firearms store that sells both guns and ammunition, has audio tapes
to support his claims. The United States Consumer Coalition calls this just the latest example of
the extralegal overreach of Operation Choke Point, the Obama administration's effort to put industries
it doesn't like — especially gun dealers and pay day lenders — out of business.
Down On Operation Choke Point. The sheer evil brilliance of Obama's minions never
ceases to amaze me. They are tenacious in their efforts to find ways to circumvent the Constitution
and our laws — they simply never give up. There is no better example of this currently
than Operation Choke Point. They were caught in 2013 targeting legal industries they did not
approve of by bullying banks and other financial institutions into cutting off funds to those whose
activities were not 'acceptable.' Specifically, the gun industry.
Obama uses Justice Dept. to target gun sellers, 'high risk' businesses. A House panel says the Obama
administration is using the Justice Department to target and "choke out" businesses it finds objectionable, from gun
dealers and payday lenders to drug paraphernalia sellers and porn merchants. The administration is using an
anti-credit card fraud effort dubbed Operation Choke Point to go after legitimate businesses it deems "high-risk,"
says a staff report by the House Committee on Oversight and Government Reform.
Out The Administration's Latest Backdoor Effort To Control Gun Sales. In 2013, Barack Obama's Justice
Department launched Operation Choke Point, which it said it would use to "monitor" banks and other financial institutions
who process transactions for payday loan businesses and other online lenders the administration considers open to fraudulent
activities. And now? The operation is reportedly being used against banks who do business with other types of
companies the administration deems "high risk." Among them: porn stores, escort services and drug paraphernalia
shops. And gun dealers. Yeah, gun dealers.
The Government Agency From Hell, the
"Consumer Financial Protection Bureau". A little-known federal government agency, the Consumer Financial Protection Bureau, imposes enormous
costs on consumers and financial service providers through costly and unwarranted command-and-control regulation. What's more, the Consumer Financial
Protection Bureau runs afoul of the constitutionally mandated separation of powers. Thus, both economic and constitutional concerns indicate that it
is time for Congress to abolish the Consumer Financial Protection Bureau and reallocate those of its functions that merit being retained to other existing
federal regulatory agencies. Creation of the Consumer Financial Protection Bureau was a key feature of the Dodd-Frank Act of 2010, which, as Heritage
scholars have explained, represents a failed attempt to address the causes of the 2008 financial crisis (in fact, it makes future financial crises and
bailouts more likely).
based anti-discrimination settlements on 'half baked' statistics. The Consumer Financial Protection Bureau launched an anti-discrimination crusade
against banks giving auto loans in 2012 based not on specific complaints by consumers, but on "half-baked" statistics, according to a story in The New York Post.
In fact, there were no complaints filed with the Bureau at all. Instead, the CFPB issued summary judgments extorting and shaking down banks in an effort to
achieve "racial justice."
bullied bank to pay racial settlement without proof: report. Newly uncovered internal memos reveal the Obama administration
knowingly exaggerated charges of racial discrimination in probes of Ally Bank and other defendants in the $900 billion car-lending
business as part of a "racial justice" campaign that's looking more like a massive government extortion and shakedown operation.
So far, Obama's Consumer Financial Protection Bureau has reached more than $220 million in settlements with several auto lenders
since the agency launched its anti-discrimination crusade against the industry in 2013. Several other banks are under active
investigation. That's despite the fact that the CFPB had no actual complaints of racial discrimination — it was all
just based on half-baked statistics.
mocks agency's 1,000-page plan to simplify loan forms. House Republicans and the nation's head consumer watchdog sparred Tuesday
[7/24/2012] over an agency proposal to simplify mortgage documents that runs more than 1,000 pages. Republicans expressed astonishment
at the length of the proposed rule and argued the page count is evidence that the Consumer Financial Protection Bureau (CFPB) is taking the
heavy-handed approach to regulation that it has long feared. "Only inside this Beltway that we come up with solutions that are so
difficult," Rep. Mike Kelly (R-Pa.) said at the hearing of a House Oversight subcommittee. "It's government red tape that's keeping
this economy from recovering."
Lee Attempt to Take Down Operation Choke Point. Sens. Ted Cruz of Texas and Mike Lee of Utah plan to
introduce a bill today that attempts to unravel the Justice Department's controversial program Operation Choke Point, The
Daily Signal has exclusively learned. "Under President Obama's reign, the DOJ has abandoned its longstanding tradition
of staying out of politics and has instead become a partisan arm of the White House," Cruz said. "The Obama
administration initiated Operation Choke Point to punish law-abiding small businesses that don't align with the president's
political leanings. The DOJ should not be abusing its power by trying to bankrupt American citizens for exercising
their constitutional rights."
Voicemail, Bank Says It No Longer Lends to Firearms Dealers. The stories of two businessmen who recently were
denied banking services because they sell firearms suggest a secretive government program called Operation Choke Point still
affects industries across the nation that the Obama administration considered undesirable. In one case, a large bank in
New England denied a line of credit to a former police officer who started a gun and tactical business in Monroe, Conn., saying
it "no longer lends to firearms dealers." In the other case, a branch of a North Carolina bank refused to set up a
new payment service for a firearms seller in Tryon, N.C., because of the nature of his industry, the business owner said.
attempts to end Operation Choke Point with letter, action. In an effort to put an end
to Operation Choke Point — a financial task force that was created by the Obama administration
to "choke out" businesses it finds objectionable like gun shops — the Federal Deposit Insurance
Corp. issued a letter Wednesday [1/28/2015] saying all banks should examine their customer relationships
on a case-by-case basis and not by industry operational risk. The government agency followed the
action with a memorandum to its supervisory staff requiring examiners put in writing their recommendation
to terminate an account, which the financial institution must review before the account is ended.
Changes Tactics in Response to Operation Choke Point. The Federal Deposit Insurance
Corp. has acknowledged its role in Operation Choke Point and is taking dramatic steps to reverse its
policies in targeting legal and legitimate industries that are disfavored by the Obama administration.
"We're very pleased they've acknowledged their wrongdoing and they've accepted our suggestions to put in
place measures to stop this activity," Rep. Blaine Luetkemeyer, R-Mo., told The Daily Signal in a phone
call this morning [1/28/2015].
accused of targeting gun industry with 'Choke Point' program. The Obama administration, after failing to get
gun control passed on Capitol Hill, has resorted to using its executive power to try to put some in the firearms industry
out of business, House Republican investigators say. The assertion is included in a report recently released by California
GOP Rep. Darrell Issa, chairman of the House Oversight and Government Reform Committee. Citing internal
Justice Department documents, the committee concluded that the administration used a program known
as Operation Choke Point to target legal companies that it finds "objectionable."
'Operation Choke Point' is Illegal, Must be Dismantled. The Justice Department's
"Operation Choke Point" is so flagrantly illegal it cannot continue in any form under the law, the
House Oversight and Government Reform Committee Charman Darrell Issa's staff said in a new report,
setting up a constitutional confrontation between the legislative and executive branches of the
federal government. "In light of the Department's obligation to act within the bounds of the law,
and its avowed commitment not to 'discourage or inhibit' the lawful conduct of honest merchants, it
is necessary to disavow and dismantle Operation Choke Point," the report said. The controversial
Obama administration initiative known as Operation Choke Point was launched in 2013.
votes to defund Justice Dept. program that targeted legitimate gun dealers. The House of Representatives
passed an amendment Thursday to stop all federal funding to be used for the Department of Justice's Operation Choke
Point, an anti-fraud operation that was found to be cutting off legitimate businesses from their banking lines.
"This is a major victory for consumers, law-abiding businesses, and anyone who believes in due process and restraint
of government encroachment," said the Community Financial Services Association of America, a trade group opposed to the
operation, in a statement Friday. "Additionally, our banking system benefits as it will not be put in the position
to police customers or make judgments about the political popularity of businesses and industries."
launching hearings on complaints businesses targeted by 'Operation Choke Point'. A
controversial federal law enforcement program that critics say targeted businesses the Obama
administration didn't like is about to face a new wave of congressional scrutiny, with Capitol Hill
hearings set to begin Tuesday [3/24/2015]. Under the program, called Operation Choke Point, banks
and other financial institutions were reportedly pressured to cut off accounts for targeted businesses.
This included gun stores, casinos, tobacco distributors, short-term lenders and other businesses.
Critics claim the program — overseen by the Justice Department, Federal Deposit Insurance
Corporation and other agencies — was used to squeeze legal companies that some politicians
considered morally objectionable.
to Government Official: Why Has No One Been Fired Over Choke Point? The head of the
Federal Deposit Insurance Corporation (FDIC) told members of Congress Tuesday [3/24/2015] that part of the
agency's involvement in Operation Choke Point was a "mistake." "Clearly there was misunderstanding
with regards to the list, which was a mistake on our part," Martin Gruenberg, chairman of the FDIC, said
of the agency's decision to create a supervisory list of 30 "high risk" industries that, in addition to
highlighting a number of illegal or outright offensive enterprises like "racist materials," featured
legal merchants such as gun dealers and payday lenders. But if it was a "mistake," Republicans
asked, why has no one been fired or held accountable?
Wants FDIC Officials to Pay for Seeking to 'Choke' Legal Businesses. Senior FDIC officials must be held
accountable for banking regulators' "unethical" and "illegal" actions against legitimate businesses that are out of
favor with the Obama administration, a congressman with a background in banking said today [12/10/2014]. In a
letter to Martin Gruenberg, chairman of the Federal Deposit Insurance Corporation, Rep. Blaine Luetkemeyer, R-Mo.,
says he wants a full review of all FDIC employees involved in Operation Choke Point. Luetkemeyer, a rising member
of the House Financial Services Committee, names five officials as "implicated in this unsavory affair," and adds that
"to allow these individuals to go without penalty would be unjust."
Four Business Owners Squeezed by Operation Choke Point. With no explanation, Brian
Brookman last month lost the bank account for his pawn shop. He had no idea why. Brookman says
his store in Grand Haven, Mich., never had been in trouble with federal or state officials. [...]
After researching his case on the Internet, Brookman says he concluded that his banker, JP Morgan
Chase, closed the account because two of his business activities — dealing in vintage
coins and selling firearms — were labeled "high risk" by federal bureaucrats as part of
an Obama administration initiative called Operation Choke Point.
Choke Point: Shutting Down Perfectly Legal Businesses for Political Reasons. In recent
months, a federal government regulatory initiative called Operation Choke Point has gained increased
public and media attention. Operation Choke Point is ostensibly a joint effort by various regulatory
entities — the Department of Justice (DOJ), Office of the Comptroller of the Currency,
and Federal Deposit Insurance Corporation (FDIC) most prominent among them — to reduce
the chances of Americans falling victim to fraud in a variety of "high-risk" industries,
predominantly payday lending. It uses existing regulatory powers to provide heightened supervision
of banks that do business with the third party payment processors that provide payment services to
Choke Point Hearing Reveals DOJ Threats And Strong-Arming. A Justice Department fraud
prevention program came under fire Thursday for allegedly morphing into actively pressuring banks to
deny financial services to businesses for political reasons. Operation Choke Point functions as a
partnership between the Department of Justice (DOJ) and various other federal agencies which deal
with bank regulations, specifically the Treasury and the SEC. The objective of the project is to
choke-off fraudulent businesses from accessing financial services, in an effort to protect consumers.
The controversy, however, is over allegations that the DOJ is pressuring financial institutions to decline
doing business with so-called "high risk" industries which line up squarely against the political leanings
of the current administration.
Race Cops Now Targeting Small-Business Lenders. Opening a new front in its "disparate
impact" discrimination campaign against the private sector, the Obama regime is planning to force
banks for the first time to report small-business lending data by race. The coming race database
will add to those the regime already has begun building to collect what it hopes is statistical
evidence of national racism in housing, zoning, mortgage lending, credit card financing, hiring and
even school discipline. The Consumer Financial Protection Bureau had planned to foist the onerous
new regulation — which requires lenders to report the race and ethnicity of the principal
owners of small businesses applying for loans and credit lines — on the financial
industry next year.
Operation Choke Point And The New American Legal System. Recently social media was
ablaze with the news that adult entertainer, Teagan Presley, had received word from Chase Bank that
they were closing her account. Presley had just become the latest law-abiding citizen to be swept
up in "Operation Choke Point," an joint effort by the Departments of Justice, Treasury and a handful
of other agencies to effectively shut-down industries that the federal government doesn't like.
Here's the catch — they have no legal authority to shutter them and most of the victims of
this overreach are losing their banking relationships even though they've done nothing wrong.
The CFPB A Real-Life Version of Scandal's B613? In the fictional Washington of ABC's Scandal, B613
is a super-secret spy agency that operates outside the bounds of the federal government, using its assets to "protect
the Republic." Similar to B613, the real-life Consumer Financial Protection Bureau (CFPB), established in 2010
by Dodd-Frank, operates as an "independent agency" outside the constitutional authority of the United States Congress,
with little oversight or accountability.
Unleashing Army Of 'Behavioral Economists' On Consumers. The Consumer Financial Protection Bureau plans to add
more "behavioral economists" as part of a new Obama executive order to use data mining to manipulate consumer behavior —
and push his leftist agenda. The president's new order, titled "Using Behavioral Science Insights to Better Serve the American
People," calls on CFPB and other regulatory agencies to "recruit behavioral science experts" to "design government policies."
The new army of social engineers will work with the Orwellian-sounding White House Social and Behavioral Sciences Team to massage
consumer data and "nudge" consumers toward behaving the way Big Brother Barack wants them to behave. That means signing up
for "free" health care, for example, and buying more eco-friendly products while commuting less to reduce their carbon footprint.
pen strikes again. The most important story you never heard anything about in the mainstream media is when President Obama
picked up his fabled pen and signed an executive order on Tuesday, Sept. 15, entitled "Using Behavioral Science Insights to Better
Serve the American People." Ladies and gentlemen, you have just been "Nudged."
Big Brother Database Grows Scarier By Day. Known as the National Mortgage Database, it
will store vast amounts of personally identifiable information, as well as extremely sensitive
financial information that even the IRS doesn't collect, including your credit scores and
performance data on credit cards and home, auto, business and student loans. The repository will
be linked to your name, telephone numbers, Social Security number, employment records, address and
date of birth, as well as race and religion. The regime cryptically explains it's collecting the
data for "research" and "policymaking." But according to a Federal Register notice, the database
will also be used by the Federal Housing Finance Agency to prosecute financial crimes.
Issa Demands Answers from Eric Holder on 'Operation Choke Point' Bank Shakedown. Breitbart News broke the story Wednesday
morning [1/8/2014] that the Obama administration launched 'Operation Choke Point' out of the Department of Justice in 2013 for the
express purpose of destroying three key sectors of the private lending industry: third party payment processors ("TPPPs"), online
lenders, and payday lenders. Issa and Jordan requested that the Department of Justice turn over to the House Oversight and
Government Reform Committee "[a]ll documents and communications since January 1, 2011 referring or relating to 'Operation
Choke Point'" by January 22, 2014.
Shakes Down 'Racist' Banks For Nearly $1 Bil. Attorney General Eric Holder has opened up a new front against car
lenders and has forged an alliance with the Consumer Financial Protection Bureau to frame them for racism, too. We don't use the
term "frame" capriciously, certainly not like Holder uses the charge of racism. His department and the president's new consumer
credit watchdog agency, CFPB, have announced a new settlement with Ally Bank for nearly $100 million.
Calls for impeachment.
[Scroll down] The President's unconstitutional recess appointments of Richard Cordray to be head of the Consumer
Financial Protection Bureau (CFPB) and three new members of the National Labor Relations Board (NLRB) may be
impeachable offenses, according to some constitutional experts. There are multiple offenses against the
Constitution in this tyrannical and undemocratic act. Article I, Section 5 allows the Senate to
adjourn for more than three days only when it has the consent of the House. The House refuses to allow
the Senate to go into an extended recess.
Spying On Consumers Without Security Protections. The most powerful unaccountable agency in Washington is mining and
amassing all your personal financial data. While that's bad enough, it also isn't adequately protecting them from hackers and
identity thieves. A just-released inspector general report found that the Consumer Financial Protection Bureau, is conducting
a massive consumer data-mining operation without the security safeguards to protect the sensitive data from cyberattacks.
Choke Point is government run amuck. Operation Choke point is an Obama Administration
Justice Department program created in 2013 to intimidate banks into not loaning money to businesses
that they simply do not like. This means that gun shop owners, tobacco retailers, and other
companies like this are going to be feeling the stranglehold of government. Already, they have
used the program to block credit being issued to small business owners and have put gun dealers out
of business. They have targeted companies that sell fireworks. They targeted online gaming
companies. They went after tobacco sellers and dating services. They have even targeted loan
companies if they don't favor the rates and the recipients, such as "payday" loan companies.
challenges the constitutionality of Dodd-Frank. With the Supreme Court poised to rule on the constitutionality of Obamacare,
a suit filed today challenges the constitutionality of the other signature legislation of President Obama's first term: Dodd-Frank. [...] The
lawsuit's major claim is that the formation and operation of the Consumer Financial Protection Bureau (CFPB) violates the constitution because its
director (or czar) is not accountable to Congress or the President, and the decisions of the agency are not even subject to judicial review.
The CFPB escapes meaningful congressional oversight because its budget — some $400 million — comes from the Federal
Financial Protection Bureau already sinking into scandal. It's great to have Uncle Sam looking out for the little guy,
isn't it? That's why it was such a super-duper, nifty idea for Washington to summon into being the Consumer Financial Protection
Bureau. [...] So now that they are on the job, keeping citizens safe from big banking fat cats and ensuring financial responsibility
and ethics, how are they doing? Well... pretty much on par with what you'd expect out of any massive Washington bureaucracy.
Starts Constitutional Crisis, Installs New Radical Czars. Apparently, "respecting the U.S.
Constitution" didn't make it onto President Obama's 2012 New Year's resolution list, as evidenced by his
"recess" appointment of anti-business extremist Richard Cordray to head the Consumer Financial Protection
Bureau (CFPB). Just an few hours later, Obama made three additional appointments to the National Labor
Relations Board (NLRB), which has become little more than a Big Labor battering ram under this president.
Obama is terming his appointments "recess" appointments. They are nothing of the sort, because Congress
is not in recess.
Reject the trial-lawyer
czar. The legacy of President Obama's time in office has been an unprecedented expansion of the
federal government. A perfect example of this is the Consumer Financial Protection Bureau (CFPB), which is
part of the Dodd-Frank financial regulatory law. Even though this brand-new bureaucracy opened for business in July,
most Americans have never heard of it — and they won't so long as it remains leaderless. Senate
Republicans held strong against the possible nomination of Elizabeth Warren, Mr. Obama's presumed first choice
to run this $329 million drain on taxpayer resources.
Warren skips out during House Oversight hearing. Elizabeth Warren, President Obama's controversial
choice to head the new consumer financial regulatory agency, skipped out of a House Oversight hearing before
answering questions from two members of the committee, claiming that she had reached an agreement allowing
her to leave at that time. But Rep. Patrick McHenry, R-NC, chair of the subcommittee holding the
hearing, said no such agreement existed.
What is Elizabeth Warren's job? More
useless gov't. This is major expansion of government — a separate branch of the
Federal Reserve with immense powers to regulate "all consumer products." The excuse for it is
bogus — a simplistic and false narrative on how the financial crisis began (nothing more than evil
bankers pushing risky loans on unsuspecting consumers). And even if you buy that, the agency probably
wouldn't have stopped the meltdown because it's hardly as "independent" as its fans pretend.
$20 billion mortgage shakedown. The White House is hoping to strong-arm banks into paying off
the mortgages of irresponsible homeowners at the expense of the rest of us. The idea is to tap
financial institutions to create an unregulated $20 billion slush fund to pay off the principal for
people who are upside-down and delinquent on their housing payments. Political appointees in the Obama
administration would get to choose the winners and losers in the house pay-off lottery.
Really Making Things Up? A House panel grilled Elizabeth Warren, the interim director of the
new Consumer Financial Protection Bureau (CFPB), this week. Republicans on the committee want to strip
the agency of its power before it even begins on July 21. The agency's purpose is to oversee rules
regulating loans, credit cards and mortgages for consumers. Rep. Patrick McHenry, R-N.C., the chairman
of the subcommittee, accused Warren, a Harvard professor currently on leave from the university, of lying to
Congress about her role in helping state officials negotiate a settlement with mortgage servicers that improperly
foreclosed on homeowners. He even got into a dispute with Warren over when she could leave the hearing.
Agency Scraps Employee Ratings To Avoid 'Discrimination'. One government agency has decided
that the results of employee ratings are too discriminatory, and eliminated the process entirely.
The Consumer Financial Protection Bureau announced on Monday that it will now award all employees the
highest rating regardless of performance reviews. The CFPB, which oversees transactions in the
financial sector for the federal government, decided to no longer conduct employee reviews because
there were just too many apparent "significant disparities" between the races, ages, and locations
of its employees.