GOP bill to contend with banks

Republican Representative Andy Barr has proposed the “Fair Access to Banking Act” that seeks to prevent financial institutions from being used for political purposes and denying fair access to financial services in the name of “woke corporate cancel culture.” The bill would require banks with over $100 billion in total consolidated assets to provide access to bank services, capital, and credit while making sure they are not refusing services based solely on reputational risk.

Under this legislation, covered banks would have to provide written justification for denying a person financial services to avoid ambiguity. The bill would prohibit these banks from using discount window lending programs and would terminate their status as an insured depositary institution if they refuse business with any individual. The legislation could also lead to penalties against credit unions that refuse to do business with any person in compliance with the law.

Barr’s bill is a companion bill to one introduced in the Senate by Sen. Kevin Cramer, and is in response to U.S. banks and financial institutions allegedly excluding certain industries from accessing services based on their economic standing. These industries include fossil energy and firearms, among others. Republicans have been fighting back against these environmental, social, and governance (ESG) goals that more companies are taking on.

Barr has garnered support for his bill from over three dozen co-sponsors in the House, including House GOP Conference Chair Elise Stefanik and other Republican Representatives. Additionally, the bill is supported by the National Shooting Sports Foundation, Kentucky Coal Association, National Rifle Association, and the Blockchain Association.

According to Barr, financial firms should not decide which legally operating business receives financial services based on non-pecuniary factors such as political pressure, public relations pressure, or the moral judgment of company leadership. The bill seeks to ensure that objective, risk-based underwriting standards are the basis for making these decisions. The politicization of access to capital threatens jobs and compromises entire industries based on the opinions of a select few, says Barr.