Americans for Tax Reform led a coalition letter urging members of the Texas State Senate to support Senator Tan Parker’s resolution calling on Congress and the Trump administration to rein in rogue federal regulators. Under the Obama and Biden Administrations, federal regulators expanded their powers to debank politically disfavored industries such as firearm manufacturers and crypto traders.
The letter explains the resolution would help build support for Senator Tim Scott’s FIRM Act, which would remove “reputational risk” as a category regulators could use to to pressure banks into depriving disfavored industries of access to the financial system. The resolution seeks to recognize the climate of fear and uncertainty created by vague guidelines and businesses that have fallen victim to unfair penalties, including debanking.
Senator Parker’s resolution supports President Donald Trump’s personnel changes and Senator Tim Scott’s (R-S.C.) FIRM Act to stop overzealous regulators from unjustly harming legitimate industries and individuals. Under the guise of “reputational risk,” regulators have issued vague guidelines about which accounts should be exited and fined banks for not shutting enough Americans out of the financial system, even if they are engaged in legal commerce. The FIRM Act will remove reputational risk from regulators’ jurisdiction.
The resolution highlights the concerning trend of regulators using their authority to debank individuals and businesses, in most instances without sufficient cause or due process. This creates a climate of fear, leaving banks with no choice but to sever relationships with innocent customers to avoid retribution. In exiting accounts, financial institutions risk harming individuals or industries that, through no fault of their own, have been caught in the crossfire of bureaucratic overreach.
The resolution affirms a common-sense approach to financial oversight. Regulators should not waste time and resources cracking down on law-abiding Americans. Rather than endorsing an arbitrary blacklist of disfavored industries, Senator Parker’s resolution calls on the state of Texas to demonstrate leadership on the issue of debanking.
Texas has an opportunity to lead the nation in defending financial freedom and reining in unaccountable regulators. With this resolution, Texas lawmakers would be standing up for lawful businesses, individual liberty, and the fundamental tenets of due process against government encroachment.
By supporting this resolution, legislators in Texas will reaffirm her commitment to financial freedom and serve as a model for other states as she has on so many other issues.
The letter concludes with a call to swift legislative action.
“We urge [you] to swiftly take up and pass this resolution to build support for federal efforts to end debanking.”
Read the full letter here.
