Central ND News

The Senate Banking, Housing, and Urban Affairs Committee convened a hearing in Washington, D.C., to address concerns about the practice of debanking by financial institutions. The hearing aimed to ensure that banks make lending and service decisions based on impartial risk assessments rather than political or reputational biases.

U.S. Senator Kevin Cramer (R-ND), a member of the committee, reintroduced his Fair Access to Banking Act prior to the hearing. The legislation is designed to protect fair access to financial services and requires that banks base their decisions on unbiased risk analysis. Cramer emphasized that the bill does not mandate specific actions from banks but prohibits them from discriminating against legal industries.

Cramer shared insights from bank presidents who support the legislation because they seek relief from political pressures exerted by staff, regulators, political movements, or activist investors. "Some of the bank presidents, who have never dared say it out loud, tell me they support [the Fair Access to Banking Act] because they want this burden removed from them," he said.

The senator questioned whether prohibiting discrimination against certain industries is considered radical. He noted that regulators and mid-level executives often push for debanking based on political motives. "I think the regulators have pushed debanking of industries," he stated.

The need for transparency and notice when regulatory decisions are made was also highlighted as consistent with Cramer's proposed act. An executive order revived by the Trump administration was mentioned as providing more due process for contesting regulatory actions than previously allowed by existing clauses.