Washington DC–During a Senate Banking Committee hearing with Acting Federal Reserve Chairman Jerome Powell, U.S. Senator Mike Crapo (R-Idaho), a senior member and former chairman of the Banking Committee, highlighted his concerns about the Fed efforts to cut off access to credit and capital for politically disadvantaged industries, such as oil and gas companies or gun companies.
“Troublingly, some suggest that the Federal Reserve should prevent so-called suboptimal industries from having access to capital – either to restrict their access to capital or to deny them access to capital,” Crapo said. “[T]This is a worrying trend that has manifested itself in a number of different contexts over the past few years. The idea that we should use our federal regulators and supervisors to decide which industries are optimal and restrict those that we politically dislike from accessing capital is a very alarming idea that I think America should reject quickly.
To view Senator Crapo’s questions, click HERE.
Under the Obama administration, Crapo fought against “Operation Choke Point, an initiative in which federal agencies pressured banks to “stifle” the access of politically disadvantaged industries to payment systems and banking services. In January, Crapo sent a letter to Jelena McWilliams, then president of the Federal Deposit Insurance Corporation, asking for transparency on steps taken to address concerns about the initiative and related 2018 investigation. President McWilliams responded at the request of January 31, 2022.
Crapo has troubled banks in the past for issuing guidelines that could effectively cut off financial services to law-abiding gun manufacturers, retailers and gun buyers if they do not comply with bank preferences in matters of firearms.