On May 25, Rep. Blaine Luetkemeyer (R-Mo.) reintroduced the Financial Institution Customer Protection Act (H.R. 2706), which would prohibit federal agencies from requesting or ordering a financial institution to terminate a banking relationship unless the regulator had material reason. H.R. 2706 would, in effect, seek to end the Department of Justice’s “Operation Choke Point” by requiring termination requests to rely on information other than reputational risk.
Notably, as previously discussed in InfoBytes, last month a group of payday lenders filed a brief with an appellate court claiming a district court judge was wrong to deny their request for a preliminary injunction against regulator activities they claim violate their rights to due process.