August 16, 2014

“CHOKE POINT” ROWBACK: Federal Agency Blames ‘Confusion’ for Choking Business Owners’ Access to Banks.

Federal regulators have backed away from pressuring banks to stop doing business with legal enterprises that the Obama administration labeled “high risk” — including selling guns, making payday loans, and trading in rare coins.

Late last month, the Federal Depositors Insurance Corporation told banks that it had removed a list of 30 examples of “high risk” activities from the agency’s website, stating its list had “led to misunderstandings.”

By “misunderstandings,” FDIC apparently meant that its guidance led to sudden decisions by banks across America to close accounts with customers that fell under any of the listed categories.

If they didn’t close the accounts, bank officers thought, they could be subject to federal audits or other investigations.

Yeah, I don’t think there was confusion at all. I think they just got caught.