Monday, May 19, 2014

Targeted? Gun sellers say ‘high risk’ label from feds cuts off banking options, restricts business



Targeted? Gun sellers say ‘high risk’ label from feds cuts off banking options, restricts business
Obama plan pressures financial institutions
By Kelly Riddell
The Washington Times
Sunday, May 18, 2014
Gun retailers say the Obama administration is trying to put them out of business with regulations and investigations that bypass Congress and choke off their lines of credit, freeze their assets and prohibit online sales.

Since 2011, regulators have increased scrutiny on banks’ customers. The Federal Deposit Insurance Corp. in 2011 urged banks to better manage the risks of their merchant customers who employ payment processors, such as PayPal, for credit card transactions. The FDIC listed gun retailers as “high risk” along with porn stores and drug paraphernalia shops.

Meanwhile, the Justice Department has launched Operation Choke Point, a credit card fraud probe focusing on banks and payment processors. The threat of enforcement has prompted some banks to cut ties with online gun retailers, even if those companies have valid licenses and good credit histories.

“This administration has very clearly told the banking industry which customers they feel represent ‘reputational risk’ to do business with,” said Peter Weinstock, a lawyer at Hunton & Williams LLP. “So financial institutions are reacting to this extraordinary enforcement arsenal by being ultra-conservative in who they do business with: Any companies that engage in any margin of risk as defined by this administration are being dropped.”

A Justice Department representative said the agency is conducting several investigations that aim to hold accountable banks “who are knowingly assisting fraudulent merchants who harm consumers.”

“We’re committed to ensuring that our efforts to combat fraud do not discourage or inhibit the lawful conduct of these honest merchants,” the Justice Department said in a May 7 blog post.

But gun retailers say their businesses are being targeted in the executive branch’s efforts:

• T.R. Liberti, owner and operator of Top Gun Firearms Training & Supply in Miami, has felt the sting firsthand. Last month, his local bank, BankUnited N.A., dumped his online business from its service.

An explanatory email from the bank said: “This letter in no way reflects any derogatory reasons for such action on your behalf. But rather one of industry. Unfortunately your company’s line of business is not commensurate with the industries we work with.”

• Black Rifle Armory in Henderson, Nevada, had its bank accounts frozen this month as the bank tried to determine whether any of Black Rifle’s online transactions were suspicious.

• In 2012, Bank of America suddenly dropped the 12-year account of McMillan Group International, a gun manufacturer in Phoenix, even though the company had a good credit history, the owner said. Gun parts maker American Spirit Arms in Scottsdale, Arizona, received similar treatment by Bank of America, the country’s largest banking institution.

“This seems to be happening with greater frequency and to many more dealers,” 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, and they need their cash to buy inventory. Freezing their assets will put them out of business.”

Choking off access to banks

After McMillan Group owner Kelly McMillan publicized Bank of America’s action on his Facebook account, he found that thousands of small gun-shop owners across the country were in the same situation. Banks were either dropping them, freezing their accounts or refusing to process their online sales, so he opened a credit card processing company for the gun industry called McMillan Merchant Solutions.

“Four generations of my family have been in this industry. This is my way to give back,” said Mr. McMillan, adding that many of his customers were denied banking access because of the nature of their business. “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.”


Federal Deposit Insurance Corp (FDIC)
John C. Dugan was director at the Federal Deposit Insurance Corporation (FDIC), a comptroller for the Comptroller of the Currency, and is a partner at Covington & Burling LLP.

Note: Cantwell F. Muckenfuss III was the counsel to the chairman for the Federal Deposit Insurance Corporation (FDIC), a senior deputy comptroller for the Comptroller of the Currency, and is a director at the Roosevelt Institute.
Foundation to Promote Open Society was a funder for the Roosevelt Institute, the Committee for Economic Development, and the NAACP Legal Defense & Educational Fund.
George Soros was the chairman for the Foundation to Promote Open Society.
Eugene A. Ludwig is a trustee at the Committee for Economic Development, was a comptroller for the Comptroller of the Currency, and a partner at Covington & Burling LLP.
Michael D. Barnes was a senior of counsel at Covington & Burling LLP, and the president of the Brady Campaign to Prevent Gun Violence.
Covington & Burling LLP was the lobby firm for the Bank of America Corp. (Bailout Company), and is the lobby firm for Chiquita Brands International, Inc.
Lawyer for Chiquita in Colombia Death Squad Case May be Next U.S. Attorney General
Dan Kovalik
USW Counsel, Workers Uniting Colombia Committee
Posted: November 6, 2008 05:12 PM
Indeed, Holder himself, using his influence as former deputy attorney general under the Clinton Administration, helped to negotiate Chiquita's sweeheart deal with the Justice Department in the criminal case against Chiquita. Under this deal, no Chiquita official received any jail time.
Eric H. Holder Jr. was a partner at Covington & Burling LLP, an intern at the NAACP Legal Defense & Educational Fund, a board member for the American Constitution Society, Chiquita Brands International, Inc. was his client, and is the attorney general at the U.S. Department of Justice for the Barack Obama administration.
Janet Reno is a board of adviser’s member for the American Constitution Society, and was the attorney general at the U.S. Department of Justice for the William J. Clinton administration.
Mario M. Cuomo is a board of adviser’s member for the American Constitution Society, and his daughter is Maria Cuomo Cole.
Maria Cuomo Cole is Mario M. Cuomo’s daughter, and a trustee at the Brady Center to Prevent Gun Violence.
Open Society Foundations was a funder for the American Constitution Society, and the Atlantic Council of the United States (think tank).
George Soros is the founder & chairman for the Open Society Foundations.
Richard W. Edelman is a director at the Atlantic Council of the United States (think tank), and the president & CEO for Edelman.
PayPal is an Edelman client.
Linda P. Hudson was a director at the Atlantic Council of the United States (think tank), and is a director at the Bank of America Corp. (Bailout Company).
Charles O. Rossotti is a director at the Atlantic Council of the United States (think tank), a director at Booz Allen Hamilton, and was a director at the Bank of America Corp. (Bailout Company).
Robert S. Osborne is the EVP & general counsel for Booz Allen Hamilton, and a member of the Commercial Club of Chicago.
Cyrus F. Freidheim Jr. was a managing director at Booz Allen Hamilton, the chairman & CEO for Chiquita Brands International, Inc, is a member of the Commercial Club of Chicago, and an honorary trustee at the Brookings Institution (think tank).
Foundation to Promote Open Society was a funder for the Brookings Institution (think tank).
George Soros was the chairman for the Foundation to Promote Open Society.
A.W. Clausen was an honorary trustee at the Brookings Institution (think tank), and the chairman & CEO for the Bank of America Corp. (Bailout Company).
Robert A. Helman was an honorary trustee at the Brookings Institution (think tank), is a partner at Mayer Brown, and a Commercial Club of Chicago.
Mayer Brown was the lobby firm for the Bank of America Corp. (Bailout Company).
William M. Daley 
Professional career 
Daley returned to the practice of law, as a partner with the firm Mayer Brown (then Mayer, Brown & Platt) from 1993 to 1997.
William M. Daley was a partner at Mayer Brown, the chief of staff for the Barack Obama administration, and is a member of the Commercial Club of Chicago.
Walter E. Massey is a member of the Commercial Club of Chicago, and was the chairman for the Bank of America Corp. (Bailout Company).
Penny S. Pritzker is a member of the Commercial Club of Chicago, the secretary of the U.S. Department of Commerce for the Barack Obama administration, was the national finance chair, fundraiser for the 2008 Barack Obama presidential campaign, a co-chair for the 2009 Barack Obama inaugural committee, a fundraiser, national co-chair for the 2012 Barack Obama presidential campaign, a contributor for the 2013 Barack Obama inaugural committee, the host for the Barack Obama fund-raising dinner, 7/2/2008, and a member of the President's Council on Jobs and Competitiveness.
Monica C. Lozano was a member of the President's Council on Jobs and Competitiveness, and is a director at the Bank of America Corp. (Bailout Company).
Donald E. Powell was a director at the Bank of America Corp. (Bailout Company), and the chairman for the Federal Deposit Insurance Corporation (FDIC).
John L. Douglas was an attorney for the Bank of America Corp. (Bailout Company), and the general counsel for the Federal Deposit Insurance Corporation (FDIC).
Cantwell F. Muckenfuss III was a counsel to the chairman for the Federal Deposit Insurance Corporation (FDIC), and is a director at the Roosevelt Institute.
Foundation to Promote Open Society was a funder for the Roosevelt Institute.
George Soros was the chairman for the Foundation to Promote Open Society.
Paul S. Sarbanes is a governor at the Roosevelt Institute, and was Martin J. Gruenberg’s senior counsel.
Martin J. Gruenberg’s senior counsel was Paul S. Sarbanes, and is the chairman for the Federal Deposit Insurance Corporation (FDIC).
Jonathan Soros is a senior fellow at the Roosevelt Institute, George Soros’s son, the vice chairman for the Open Society Foundations, and was the vice chairman for the Foundation to Promote Open Society.
Open Society Foundations was a funder for the Atlantic Council of the United States (think tank).
George Soros is Jonathan Soros’s father, the founder & chairman for the Open Society Foundations, and was the chairman for the Foundation to Promote Open Society.
Foundation to Promote Open Society was a funder for the Roosevelt Institute, and the Aspen Institute (think tank).
Reid Hoffman was a fellow at the Aspen Institute (think tank), and the EVP for PayPal.
PayPal is an Edelman client.
Richard W. Edelman is a director at the Atlantic Council of the United States (think tank), and the president & CEO for Edelman.
















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