DOJ To End Operation ChokePoint; Porn Stars Free To Bank Once More!

Legal Issues

from the strange-times dept

You may recall that in 2014 we wrote about a strange occurrence having to do with Chase Bank refusing to provide its banking services to Teagan Presley, a rather well known adult film actress. When it became clear that Presley wasn’t the only performer to whom this was happening, it initially looked as though banks were engaging in a form of slut-shaming of adult film actors. It turned out, however, that it was the federal government doing the slut-shaming, with the emergence of the Department of Justice’s Operation Choke Point. This DOJ policy that was developed to combat financial fraud somehow bled over the stencil lines and became a sort of banking morality police, encouraging banks to cut off services to industries like adult film, fireworks retail stores, and sellers engaged in what the DOJ deemed to be “racist materials.” It’s worth highlighting that all of these industries and actions, whether you like them or not, are legal, yet the DOJ was essentially attempting to extra-judiciously scuttle them through secretive federal policy. That should have terrified everyone, but didn’t, and so the program went on.

Until recently. The justice department recently announced that Operation Choke Point will be ended.

The move hands a big victory to Republican lawmakers who charged that the initiative — dubbed “Operation Choke Point” — was hurting legitimate businesses. In a letter to House Judiciary Chairman Bob Goodlatte (R-Va.), Assistant Attorney General Stephen Boyd referred to the program as “a misguided initiative.”

“We share your view that law abiding businesses should not be targeted simply for operating in an industry that a particular administration might disfavor,” says the letter, obtained by progressive activist group Allied Progress and later provided to POLITICO by Goodlatte’s office. “Enforcement decisions should always be made based on facts and the applicable law. We reiterate that the Department will not discourage the provision of financial services to lawful industries, including businesses engaged in short-term lending and firearms-related activities,” it adds. A nearly identical letter was sent to Sens. Thom Tillis (R-N.C.) and Mike Crapo (R-Idaho).

We tend to stay away from partisan politics here at Techdirt, but I cannot write this post without pointing out the oddity that is an Obama-era policy preventing adult film stars from getting banking services and a GOP administration then restoring them. Obviously, per Boyd’s letter, there are many more industries that were persecuted that are more in the realm of typical conservative fodder, but it seems that the DOJ is ending the operation in full and is doing so as a matter of principle. Good principle, it should be noted, because attempting to punish lawful businesses through banking back-deals is an especially scummy way to do government. Several applauding members of the government rightly point out that temporary presidential administrations ought not be able to choke out (their word, not mine) legal businesses at their whim and fancy.

Goodlatte and House Financial Services Chairman Jeb Hensarling (R-Texas), along with Reps. Tom Marino (R-Pa.), Blaine Luetkemeyer (R-Mo.) and Darrell Issa (R-Calif.) praised the department in a joint statement.

“We applaud the Trump Justice Department for decisively ending Operation Choke Point,” they said. “The Obama Administration created this ill-advised program to suffocate legitimate businesses to which it was ideologically opposed by intimidating financial institutions into denying banking services to those businesses.”

Now, some of these industries themselves are industries we may not want to applaud. Some of us have severe issues with payday loan companies, for instance, and some of us surely don’t care for the adult film business. But if they’re legal, and they are, this sort of thing is no way to deal with these industries.

Filed Under: banking, businesses, doj, operation choke point, porn stars