In an ad on Friday The Office of the Currency Auditor (OCC) seeks public input to develop rules to prevent banks from refusing to provide services to companies because of their industry.
In the words of Comptroller Brian Brooks, “The general boycotts against entire branches of industry must stop.”
The announcement by the OCC highlights extremely controversial political issues where banks have systematically denied service to Alaskan oil companies as well as planned parenting.
Speaking to the media, Brooks pointed out the bipartisan nature of many of these bans: “These things are not politically partisan, but there are all sorts of attempts to politically arm the banking system.” He continued: “There is increasing politicization of the banking sector that has the potential to be very dangerous.”
Brooks said to Cointelegraph:
“There’s no place in the US where cryptocurrencies are illegal, but there are different licensing requirements for companies affiliated with companies. So if a bank runs one of these companies, that’s one of the things that bank runs it would check as part of its due diligence whether this exchange or another company has the appropriate permits in this state. “
This means, Banks could not disqualify potential customers related to cryptocurrencies because of their industry. A combination of unsafe regulation and reputational risk has led banks to refuse to serve cryptocurrency companies around the world.
Brooks, who previously led Coinbase’s legal team and took over as head of the OCC in Mayhas launched a number of initiatives to bring cryptocurrencies in line with the banking industry. Indeed, several members of the House Financial Services Committee They felt it appropriate to criticize Brooks for focusing on cryptocurrencies during the pandemic. Given the prominent role oil companies played in today’s rulemaking proposal, Brooks could get more criticism from the same people.
The proposed rule creation is available under the file number OCC-2020-0042. The OCC invites you to submit a comment by January 4th.