Published: February 2016

In favor of stronger banking fraud protections for consumers

In a letter to the Committee on Rules Chairman Pete Sessions and Ranking Member Louise Slaughter, Consumer Action joined coalition advocates in strong opposition to the Financial Institution Customer Protection Act of 2015 (H.R. 766), introduced by Representative Luetkemeyer. The bill will hamper critical Department of Justice and banking regulator efforts (namely “Operation Choke Point”) to detect fraudulent activities and money laundering, putting consumers and financial institutions at risk of serious financial loss.

Operation Choke Point was implemented to stop banks and third-party payment processors from supporting fraudulent activity. Financial institutions have long been required to watch out for and report criminal activity, yet there is a long history of these institutions looking the other way to support highly profitable customers. During the recent rise of online commerce and automatic debiting, scammers have developed ways of systematically extracting money from consumer’s bank accounts. An enforcement effort aimed at stopping consumer fraud by targeting banks that served illegal businesses, Operation Choke Point, is coming under more fire in Congress recently by members who claim the measure forces banks to end relationships with a wide variety of lawful and legitimate merchants.

The coalition urges Congress to oppose the Financial Institution Customer Protection Act of 2015 (H.R. 766). Congress should support, not discourage, efforts that deprive criminals access to the banking system. None of Operation Choke Point’s activities are aimed at lawful businesses and Congress should support critical federal agency activities that protect their constituents.

Lead Organization

American's for Financial Reform (AFR)

Other Organizations

Americans for Financial Reform | Center for Digital Democracy | Center for Responsible Lending | Consumer Action | Consumer Federation of America | 
National Association of Consumer Advocates | 
National Council of La Raza | 
National Consumer Law Center (on behalf of its low-income clients) } National People's Action
 | Public Citizen
 | Southern Poverty Law Center
 | U.S. PIRG

More Information

For more information, please visit AFR's website.

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In favor of stronger banking fraud protections for consumers   (160203_HR766_house_oppose.pdf)