Collector - May 2015

Operation Choke Point is a government initiative designed to shut down businesses operating in supposed “ high-risk” industries, as determined by the U.S Department of Justice and the Federal Deposit Insurance Corporation, by intimidating financial institutions into denying them service.

First announced in 2013, Operation Choke Point has increasingly cast its shadow over collection agencies. In the last year, ACA International has heard from many association members whose banks have closed their accounts due to Operation Choke Point.

U.S. Rep. Blaine Luetkemeyer ( R-Mo.) is a member of the House Financial Services Committee as well as a member of the Small Business Committee. He has been one of the key members of Congress working to bring attention to Operation Choke Point, which until quite recently has remained under the public radar. In March, Luetkemeyer reintroduced legislation to end Operation Choke Point.

Collector spoke to Luetkemeyer to learn why Operation Choke Point is so dangerous for the credit and collection industry, and how he thinks ACA members can help fight it.

Why was it important to you to introduce legislation to put an end to Operation Choke Point?

Operation Choke Point is about driving existing, legitimate businesses out of business—hurting people’s ability to make a living, unemploying people, depriving our citizens of services that they want. This is the antithesis of who we are as Americans, as far as I’m concerned.

But it’s very difficult to [draw

Operation Choke Point

U.S. Rep. Blaine Luetkemeyer is leading the charge against a program that threatens the collection industry

attention to what’s going on] because the banks don’t want anybody to know that they are being targeted, and that they are having some problems with the FDIC or Department of Justice, because they don’t want retribution from the examiners. They are caught in the middle.

We tried to work with [the FDIC and DOJ], and they placated us with some letters and information to send to examiners that they shouldn’t be doing this—they call it clarifications of procedures—but obviously that wasn’t enough because [Operation Choke Point] was continuing, so we put together a bill.

I think it’s important that we continue down this road for a couple different reasons. Number one, to show that we’re not going to go away.

Second, the entrepreneurial spirit of [the American] people is to go out and take risks and start businesses—it’s who we are. And to have the government pick the winners and losers between businesses—who can exist and who can’t based on [someone’s] ideology and moral judgments and value systems— it’s contrary to who we are [as Americans].

[The FDIC and DOJ] have used their position as regulators to implement their own personal agenda. That is wrong, so we’re hell bent on continuing [to push this legislation]. I’m not going to give up. We are going to shake every tree, and I’m going to keep pushing until I get this thing done.

How is Operation Choke Point affecting businesses in the credit and collection industry?

What Operation Choke Point is all
about is cutting off financial services to
industries—not individuals, but entire
industries.

The Department of Justice’s emails say they are trying to do something about money laundering, which is a worthwhile goal and I support that.

The problem is that their emails say,
‘We don’t have enough resources to go
after [bad actors] one by one, therefore
we’ll target everyone in the industry to
get the bad guys, and the good guys will
be collateral damage.’
I’m sorry, but that doesn’t work with
me. That is not acceptable. Legitimate
businesses should not be collateral
damage.

If there are bad actors in any industry, I support going after them. But I don’t support getting rid of an entire industry of people. That is crazy. And the credit and collection industry is on their list.

The FDIC took down [its supervisory list of 30 “high risk” industries] because they were tired of having people see what they were doing. So now we have a lack of transparency.