Tag Archives: Citibank

A Subtle Way To Infringe On A Constitutional Right

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“America’s 1st Freedom” is a magazine distributed by the National Rifle Association. I am not including a link to the article I am posting about because I can’t find the article electronically although it is in the April 2020 issue of the magazine.

The title of the article is “The New Gun-Control Activism.” It deals with the strategy those who oppose the right of Americans to own guns are using to limit the availability of guns to Americans.

The article notes:

Last year, for example, Connecticut State Treasurer Shawn Wooden, who commands $37 billion in public pension funds, announced plans to pull $30 million worth of shares from civilian firearm manufacturer securities. Wooden also intends to prohibit similar investments in the future and to establish incentives for banks and financial institutions to adopt anti-gun protocols. The proposition was immediately praised by Sen. Richard Blumenthal (D-Conn.) and other Connecticut politicians who view the divestment from five companies–Clarus Corp., Daicel Corp., Vista Outdoor Inc., Olin Corp., and ammunition maker Northrop Grumman–as a step toward reducing gun violence.

…Wooden also requested that financial bodies disclose their gun-related portfolios when endeavoring to wok with the treasurer’s office. Wooden subsequently selected tow firms, Citibank and Rick Financial Product (both had expressed the desire to be part of the “solution on gun violence”), to take on the roll of senior bankers in Connecticut’s then-forthcoming $890 million general obligation bond sale.

Technically I guess this is legal. It is a very subtle infringement on the Second Amendment and would be very difficult to prove in court. It is also not a new approach. During the Obama administration, the administration put in place guidelines that prevented gun dealers from getting business loans from banks.

On May 19, 2014, The New American reported:

Following the Obama administration’s “Operation Broken Trust,” an operation that began just months into his first term, the Financial Fraud Enforcement Task Force was created initially to “root out and expose” investment scams. After bringing 343 criminal and 189 civil cases, the task force began looking for other targets.

The task force is a gigantic interagency behemoth, involving not only the Department of Justice (DOJ) and the FBI, but also the Securities and Exchange Commission (SEC), the U.S. Postal Service, the Internal Revenue Service (IRS), the U.S. Commodity Futures Trading Commission (CFTC), and the U.S. Secret Service.

The next target for the task force was credit card payment processors, such as PayPal, along with porn shops and drug paraphernalia stores. In 2011, it expanded its list of “high risk” businesses to include gun shops. Peter Weinstock, an attorney with Hunton & Williams, explained:

This administration has very clearly told the banking industry which customers they feel represent “reputational risk” to do business with….

Any companies that engage in any margin of risk as defined by this administration are being dropped.

In 2012, Bank of America terminated its 12-year relationship with McMillan Group International, a gun manufacturer in Phoenix, and American Spirit Arms in Scottsdale. Said Joe Sirochman, owner of American Spirit Arms:

At first, it was the bigger guys — gun parts manufacturers or high-profile retailers. Now the smaller mom-and-pop shops are being choked out….

They need their cash [and credit lines] to buy inventory. Freezing their assets will put them out of business.

That’s the whole point, according to Kelly McMillan:

This is an attempt by the federal government to keep people from buying guns and a way for them to combat the Second Amendment rights we have. It’s a covert way for them to control our right to manufacture guns and individuals to buy guns.

With the Obama administration unable to foist its gun control agenda onto American citizens frontally, this is a backdoor approach that threatens the very oxygen these businesses need to breathe. Richard Riese, a senior VP at the American Bankers Association, expanded on the attack through the banks’ back doors:

We’re being threatened with a regulatory regime that attempts to foist on us the obligation to monitor all types of transactions.

All of this is predicated on the notion that the banks are a choke point for all businesses.

How you vote matters.

Politicizing Finance

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On Friday The Conservative Treehouse posted an article about a recent policy change by Citibank.

This is the new policy:

[…] Today, our CEO announced Citi is instituting a new U.S. Commercial Firearms Policy. […] Under this new policy, we will require new retail sector clients or partners to adhere to these best practices: (1) they don’t sell firearms to someone who hasn’t passed a background check, (2) they restrict the sale of firearms for individuals under 21 years of age, and (3) they don’t sell bump stocks or high-capacity magazines. This policy will apply across the firm, including to small business, commercial and institutional clients, as well as credit card partners, whether co-brand or private label.

Citibank has every right to do what they are doing. However, the American public has every right to choose whether or not to do business with Citibank. Unfortunately the American public did not have any say in the $476.2 billion in cash and guarantees that Citibank received from TARP, the FDIC, and the Federal Reserve during the financial crisis .

The article notes:

However, with more and more organizations deciding to limit the use of their products and services based on political ideology; and with Citibank now openly stating their intent to create national legislation without actually applying congressional laws to their endeavors; it’s a fair request to say Citi-group should no longer be permitted any favorable benefits from the FDIC.

As a private company, Citibank has the right to a company policy about guns, but restricting the sale of firearms for individuals under 21 years of age is contrary to the Second Amendment of the U.S. Constitution.  I wonder if a retail sector client has a legal case against Citibank if he refuses to abide by these terms and his business is prohibited from using Citibank credit cards.

The idea of injecting political views into business practices can be a problem. What if a bank decides it will not grant car loans to cars that run on gasoline because they believe in the concept of electric cars? What if a bank refuses loans to homes unless they have solar power? A corporation has the right to set their own company policies, but those policies should be in line with the U.S. Constitution if they are a business based in America.

 

Regular Readers Of This Blog Know This, But Here It Is Again

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I  have periodically posted the YouTube video “Burning Down the House” on this website to remind people what actually caused the housing bubble as opposed to what they were being told caused the housing bubble. There is a reason I am posting it again.

In December 2012, a website called examiner.com posted a story with the headline, “New study confirms economy was destroyed by Democrat policies.” Sounds like the video at YouTube. The study was done by the National Bureau of Economic Research and released the week of December 21, 2012.

The article reports:

-No one was making bad loans to unqualified people until Democrats came along and threatened to drag banks into court and have them fined and branded as racists if they didn’t go along with the left’s Affirmative Action lending policies…all while federally insuring their losses. Even the New York Times warned in the late 1990s that Democrats continuing to force banks into lowering their standards would lead to this exact catastrophe.

–Obama himself is even on the record personally helping sue one lender (Citibank) into lowering its lending standards to include people from extremely poor and unstable areas, which even one of the left’s favorite blatantly partisan “fact-checkers,” Snopes, admits (while pretending to ‘set the record straight’).

If we are to remain a free people, we need to understand facts–not spin. The lies that have been told about the financial collapse of 2007 are astounding. Even worse is the fact that the Dodd-Frank legislation passed as a result of the collapse does not come anywhere near addressing the core issue.

The graph below from the National Bureau of Economic Research study shows the impact of the Community Reinvestment Act on mortgage lending:

It is time to change both the Washington culture and the media culture. Unless we do that fairly quickly, we will cease to exist as a free, prosperous nation.

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