Two stories this week highlight evidence that Bank of America engaged in discriminatory debanking against disfavored (but legal) businesses, using excuses like “reputational risk” and unacceptable religious viewpoints to close accounts.
First, Charlie Gasparino reported at the New York Post that the company “finally scrapped a controversial rule that critics say had sparked the ‘debanking’ of charities and businesses associated with conservative religious groups:”
Evangelical organizations…were slammed with a once widely-used rule across the financial-services industry that could deny services based on religious “viewpoint.”
The rule allowed woke bank administrators to cancel evangelical groups from their platforms on the grounds that opposing progressive cultural norms, such as same-sex marriage, was tantamount to hate speech.
Last year, most major banks like [JPMorgan Chase] ditched the “viewpoint” rule following attacks from conservative activists suggesting it was illegal.
Bank of America, meanwhile, was the lone holdout – until recently. [Gasparino] has learned that in late June, BofA amended its code of conduct to explicitly state that discrimination based on religious viewpoint is no longer allowed.
“While we have been very clear that politics is not a factor in our decisions, we received thoughtful input from a range of stakeholders and agreed it is best to explicitly add that to our Code of Conduct,” a spokesman said. “Religious views are not a factor in any account closing decision. Bank of America is proud to provide services to about 120,000 non-profits associated with religious organizations around the country.”
In a second development, boardroom watchdog website CorpGov reported this week that when President Trump ripped Bank of America Chairman/CEO Brian Moynihan (pictured above) at the World Economic Forum earlier this year for debanking conservatives, he had a particular type of business in mind:
“I hope you start opening your bank to conservatives, because many conservatives complain that the banks are not allowing them to do business within the bank, and that included a place called Bank of America,” the President said. “I hope you’re going to open your banks to conservatives, because what you’re doing is wrong.”
He was likely referring to when BofA stopped banking private prison company GEO Group, BofA insiders said.
“This is what Trump was pissed about,” a BofA source said. “Trump needs GEO.”
BofA in June 2019 was the last of the big banks to cut off future funding for private prison companies including GEO.
“They did not want to be the last bank standing,” a source with direct knowledge of the situation said.
GEO now processes more than one-third of the people ICE detains, 20,000 beds, at 21 facilities, according to GEO. The firm also owns prisons and jails.
But back in 2019 there was a big fight within the bank whether to stop doing more business with GEO after one of GEO’s other big lenders JPMorgan in March 2019 said it would no longer fund private prisons…
There were meetings between top bank executives where what to do about lending to private prisons was fiercely debated.
Ultimately, BofA’s Global Head of ESG Andrew Plepler had the final word and BoA stopped future funding of private prisons, the BofA source said.
“The private sector is attempting to respond to public policy and government needs and demands in the absence of long standing and widely recognized reforms needed in criminal justice and immigration policies,” BofA said in a June 2019 statement to USA Today. “Lacking further legal and policy clarity, and in recognition of the concerns of our employees and stakeholders in the communities we serve, it is our intention to exit these relationships.”
At the time, during President Trump’s first term, his political opponents were making hay out of “unaccompanied migrant children” in the care of the government, some housed at private facilities. Liberals tried to demonize the private prison industry — which like many companies that contract with the government, provide legitimate services — to the point where it became a pariah and could not access financing at the big banks. From USA Today in June 2019:
Bank of America has also underwritten bonds or given syndicated loans to CoreCivic Inc and GEO Group Inc, two major private prison operators, Reuters reported. CoreCivic released a statement Wednesday saying Bank of America misrepresented the company.
“Bank of America’s decision is about politics, not about the company we are,” the statement read. “Bank of America knows we care deeply about doing business in an ethical, responsible way, and that we have stepped up as a leader in helping address some of the most serious challenges facing our country.”
George C. Zoley, GEO’s board chairman, chief executive officer and founder, released a statement Wednesday saying that his company has never managed border patrol holding facilities or any facilities that house unaccompanied minors.
“The Processing Centers we manage on behalf of U.S. Immigration and Customs Enforcement are not overcrowded and comply with performance-based standards, which were first established under President Barack Obama’s administration,” Zoley said. “These modern Processing Centers provide safe and humane residential care, high quality medical services, and enhanced amenities including artificial turf soccer fields, flat screen TVs in living areas, indoor and outdoor recreation, classrooms, multipurpose rooms, and libraries.”
Before Bank of America, both JPMorgan Chase and Wells Fargo announced their plans to avoid private prison management companies:
JPMorgan Chase & Co has decided to stop financing private operators of prisons and detention centres, which have become targets of protests over Trump administration immigration policies.
“We will no longer bank the private prison industry,” a company spokesman told Reuters. The decision is a result of the bank’s ongoing evaluations of the costs and benefits of serving different industries, he said.
JPMorgan is one of several banks that have underwritten bonds or syndicated loans for CoreCivic Inc and GEO Group Inc, the two major private prison operators in the United States. In 2018, banks, including Bank of America Corp and Wells Fargo & Co, raised roughly $1.8 billion in debt over three deals for CoreCivic and GEO Group, according to Refinitiv data.
Wells Fargo said in January it was reducing its relationship with the prison industry as part of its “environmental and social risk management” process.
“Our credit exposure to private prison companies has significantly decreased and is expected to continue to decline, and we are not actively marketing to that sector,” Wells Fargo said in its “Business Standards Report” for 2018.
Debanking legitimate and legal private facilities (including prison) management companies followed the playbook established under Operation Choke Point by President Obama‘s “wingman” Attorney General Eric Holder, with a second iteration under President Biden. The odious Justice Department strategy also included financial deplatforming of other disfavored businesses by leftists that included the firearms industry, precious metals dealers, and payday lenders.
CorpGov reported that “Bank of America in Dec. 2023 changed its outright ban on banking private prison companies to a case-by-case assessment.”
Nonetheless political chameleons like Moynihan and Chase’s Jamie Dimon were perfectly willing enforcers of the agendas of our two most recent Democratic presidential administrations, believing they could cloak their financial gestapo activities behind laws like the Bank Secrecy Act. Rep. Jim Jordan’s House Weaponization subcommittee partially exposed their betrayal of their customers.
These two Chairman/CEOs represent the ultimate profiles in cowardice, as they now try to cozy up to the Trump administration. Both have overstayed their usefulness at their respective banks and their boards should move to replace them, as NLPC has called for via its shareholder activism recently.
