Operation Choke Point: Court Orders FDIC to Turn Over Docs to Payday Loan Industry Assoc.

FDIC Ordered to Turn Over Documents in Operation Choke Point Lawsuit to PDL Industry Assoc.

‘Time for DOJ and FDIC officials to get a lawyer!’

The Federal Deposit Insurance Corporation (FDIC) was ordered to turn over documents related to Operation Choke Point late last week.

District Court Judge Gladys Kessler told the government agency it had to begin working with the plaintiffs in the case for a nine-month discovery period beginning on June 20, 2017. “There is no justification whatsoever for not granting Plaintiffs’ Motion to Commence Discovery Immediately,” Judge Kessler said in her order.

Payday Loan Industry – The order comes after the Community Financial Services Association of America (CFSA) and a group of financial services companies filed suit against the FDIC over their conduct during Operation Choke Point. Under that operation banks were allegedly pressured into cutting ties with industries the Obama-era agency viewed unfavorably. Payday and other short-term lenders as well as those involved in the firearms industry said they were specifically targeted under the program.

The firearms industry has been particularly vocal in its opposition to Operation Choke Point. The National Rifle Association and other gun-rights groups have called the operation an attack on the industry.

Stupid things payday lenders do“‘Operation Choke Point’ is an Obama Administration initiative that encourages federal financial services regulators to harass and intimidate banks and financial institutions that work with firearm and ammunition retailers,” the National Rifle Association said in February 2016. “By leaning on the banks, regulators hoped to bring an end to those relationships thereby choking off their cash flow and forcing them out of business. A 2015 Congressional Investigation revealed that ammunition and firearm sales and dealers had, in fact, been targeted.”

CFSA said they were happy with the court’s order and believe the documents they will receive during discovery will shed light on whether the FDIC forced banks to deny certain businesses their services and, if so, how they chose which industries to target.

“We are thrilled by the Court’s order to enter the discovery phase, as this illegal federal program has been unduly harming legal entities for years,” Dennis Shaul, CEO of CFSA, told the Washington Free Beacon. “This court order allowing discovery will now finally enable the plaintiffs to access records of the federal government’s behind-the-scenes and secretive campaign to force banks to terminate their relationships with lawful American businesses. It is high time that the government’s unlawful and unjust crusade against lawful and licensed businesses be stopped. The federal regulators leading Operation Choke Point have threatened and pressured banks in the shadows of the law for far too long.

“The government defendants are well aware they have been on the wrong side of history for years and will stop at nothing to hide the extent of their illegal campaign. The Court’s ruling will allow these shady and criminal actions to be brought to the light of day.”

“The decision to grant discovery is probably the most important victory in the entire case, likely more important than the final judgment.”

Read this Report in FULL here: FreeBeacon.com

Comments ( 4 )
  • Robert Kohlke says:

    Finally! I have always had a problem with and wondered why certain banks would turn away legitimate and regulated businesses such as payday lenders. I have received notices from major banks that myself and my company have had a relationship with for years that they wanted to end our relationship for no real reason even when the accounts were always in good standing.

    I have been lucky in being able to obtain other accounts with other major banks since the Obama Admin has left.

    • PaydayLoanGuy says:

      Yes, I understand! When “Big Brother” is allowed to determine what’s good for all of us, personal choice, responsibility and freedom goes out the window!

      You’re lucky you’ve managed to secure replacement bank accounts. MANY lenders have shut down as a result of their failure to accomplish this.

      Operation Choke Point continues to cause grief in many verticals including lending, guns, ammo, gaming, lead gen…

      Congrats! You are able to continue to serve your loan customers.

      Jer – Trihouse

  • Adrian Berryhill says:

    I 100% believe that licensed, bonded and legal lenders have been damaged and their businesses, as mine, have been impacted unfairly! My business has dropped 50% while dealing with the scramble of finding ODFI and Ach processors. At times, we weren’t even certain we would be able to continue our business! The same business that had less than two formal complaints in ten years! In addition, I say we all “as a class” go after google for violating “anti trust” laws! How can they deny legal operating companies for the sake of ethics in business while involved in the same business under a different umbrella? Sign me up!

    • PaydayLoanGuy says:


      It’s a HUGE club you and I belong to! Google giveth and taketh away. THEN, they actually FUND our competition! Just look up Sasha Orloff and Lendup.
      “A Google-funded lending startup will have to pay $6.3m in fines and refunds for a number of “deceptive” practices, signaling the US government’s interest in regulating the growing industry of online alternatives to traditional payday loans.

      LendUp – a San Francisco firm that claims to offer a “secure, convenient way to get the money you need, fast” – misled customers, hid its true credit costs, and reversed pricing without disclosing it to consumers, according to the Consumer Financial Protection Bureau (CFPB). LINK

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