Sen. Kevin Cramer (R-N.D.) is planning to introduce a bill in the hopes of codifying a tabled Trump administration policy. The said policy aimed to force banks to serve the fossil fuels and firearm manufacturing industries.
The proposed legislation, which first surfaced in November 2020, would prohibit banks from refusing to give service to the said industries with categorical exclusions as the basis, instead of individual risk.
This comes in response to concerns regarding banks refusing to finance companies that gather fossil fuels or gun manufacturers
Former President Donald Trump set the rule as a means to make sure there is fair access to financing. Meanwhile, Cramer said his legislation is a matter of fairness. However, given that Democrats control Congress and the White House, it is unlikely that the bill will get signed.
Banks Place Self-Imposed Restrictions on Serving the Fossil Fuels and Gun Industries
Several banks have enforced self-imposed restrictions connected to financing activities related to fossil fuels.
In a statement, Cramer said that discrimination has no place in society, further stating that banks are not exempted from this. He added that financial service providers, such as banks don’t have the right to go against the Constitution or the law to create restrictions on businesses that are legally compliant such as energy companies and gun manufacturers.
Those who criticize the Trump policy argue that banks should not be forced to provide their services for certain industries. They also slammed the discrimination argument as it undermines the real struggles of minorities.
The proposed legislation would stop banks from refusing service with any law-abiding person. It also bans credit card companies from refusing service due to political or reputational reasons.
Those who violate this rule could face fines worth up to $10,000 per violation. They could also be disqualified from eligibility to borrow money from the Federal Reserve through its lending program.