The House voted Thursday to end Operation Choke Point, the Department of Justice initiative involving banks to crack down on fraud and money laundering.
A bill that would prevent banking regulators from forcing banks to close the accounts of customers suspected of engaging in illegal activity unless they have material cause passed the House, 250-169.
All Republicans, who have described Operation Choke Point as a violation of due process, voted in favor of the bill, as did 10 Democrats.
House Financial Services Committee Chairman Jeb Hensarling, R-Texas, said on the House floor before the vote that it was an “outrage” for “legally constituted businesses to have to fear that in the dark of night they’re going to be shut down by the awesome power of the Obama administration.”
Operation Choke Point has long been a concern to conservatives because of the belief that the Obama administration was bypassing due process to harass businesses disfavored for political reasons, such as gun sellers, by cutting off their access to bank services.
Democrats, however, issued strident criticism to a provision of the law that they said would limit the government’s ability to prosecute financial fraud after the fact.
In a veto threat of the bill issued Tuesday, the Obama administration warned that the changes to a 1989 financial crime law would make prosecutions “more burdensome, time consuming, and rare — a series of effects that will allow fraud schemes to continue unaddressed for longer periods of time, to the detriment of the safety of consumers and the American financial system.”
In a speech delivered on the Senate floor Wednesday, Sen. Elizabeth Warren, D-Mass., ratcheted up the rhetoric, saying that big banks have “gotten their buddies in Congress to line up behind a bill that would gut” the financial crimes law.
