President Trump has done away with one of the Obama administration’s most egregious initiatives.
According to The Washington Times, Assistant Attorney General Stephen Boyd sent a letter to House Judiciary Chairman, Bob Goodlatte (R-VA), informing him that they will eliminate Operation Choke Point. The operation was an initiative implemented by the Obama administration that pressured banks to refuse to work with businesses that are considered “high risk.”
The problem with the program was that it targeted only particular types of businesses. It focused primarily on gun stores. Many gun stores that were refused loans because of Operation Choke Point can now do business freely again.
Under President Barack Obama, the initiative was implemented under the guise of preventing fraud. However, it was used to target businesses and industries of which the administration did not approve.
The removal of Operation Choke Point represents a significant win for Republican lawmakers who criticized the initiative for harming legitimate businesses. When the policy was implemented, Representative Darrell Issa (R-CA) slammed it as the “Justice Department’s newest abuse of power.” He added,
“If the administration believes some businesses should be out of business, they should prosecute them before a judge and jury. By forcibly conscripting banks to do their bidding, the Justice Department has avoided any review and any check on their power.”
In the letter, Boyd stated, “We share your view that law abiding businesses should not be targeted simply for operating in an industry that a particular administration might disfavor.” He also indicated that decisions related to enforcement should be “based on facts and the applicable law.”
Boyd’s letter shows that the Justice Department will no longer pressure banks to withhold their services from lawful businesses. He writes, “We reiterate that the Department will not discourage the provision of financial services to lawful industries, including businesses engaged in short-term lending and firearms-related activities.”
Of course, President Trump’s decision to cease Operation Choke Point has been met with criticism. Karl Frisch, executive director of Allied Progress, excoriated Boyd’s letter. “Operation Choke Point has been incredibly effective at cracking down on the flow of money to fraudulent merchants that violate the law and target vulnerable consumers,” said Frisch in a statement. He also characterized the letter as “a massive giveaway to predatory payday lenders and other shady financial scam-artists.” However, conservatives have argued that the operation harmed businesses that were not engaged in wrongdoing.
Obama’s Operation Choke Point pressured banks to refuse to work with businesses that are considered “high risk,” like gun shops. Do you agree with the decision to eliminate Operation Choke Point?
Republican lawmakers have lauded the Trump administration’s decision. Representatives Goodlatte, Jeb Hensarling (R-TX), Tom Marino (R-PA), Blaine Luetkemeyer (R-MO), and Darrell Issa praised the decision in a joint statement,
“The Obama Administration created this ill-advised program to suffocate legitimate businesses to which it was ideologically opposed by intimidating financial institutions into denying banking services to those businesses.”
Republican lawmakers have been sending numerous letters to the Justice Department, requesting that they end the program. The lawmakers stated that they were receiving a significant number of complaints from their constituents. Boyd’s letter is a response to these requests. This is another step the Trump administration has taken to help small business owners. Hopefully, they will target other Obama-era policies that have made it harder for small businesses to prosper.