Alaska Delegation Welcomes Currency Rule Preventing Bank Exclusion of Energy Sector
WASHINGTON, D.C.—U.S. Senators Lisa Murkowski and Dan Sullivan, and Congressman Don Young (all R-Alaska), welcomed a proposed rule announced today by the U.S. Office of the Comptroller of the Currency (OCC) to ensure that national banks are providing fair access to banking services to customers based on objective risk, without excluding legal businesses and individuals. The announced rule comes after a sustained effort by members of Congress, led by the Alaska congressional delegation, urging the country’s senior federal financial regulators to examine the legality of decisions in late 2019 and early 2020 by several of the nation’s largest banks to withhold financing from oil and gas development projects in the Arctic, including the 1002 Area of Alaska’s Arctic National Wildlife Refuge (ANWR).
“For too long, we have seen financial institutions making policy decisions in attempts to de-bank disfavored industries. Perhaps the most recent example came late last year, as Alaskans witnessed a deeply troubling trend of America’s big banks pledging to black-list energy development projects in the Arctic, without regard for the people who live here in some of the most economically-challenged parts of the country,” said the delegation. “Not only were these pledges callous, they also very likely violated federal law. We quickly got to work, informing our congressional colleagues about the dangerous precedent this trend could set for other industries, and calling on the regulators who oversee the big banks to step forward and correct this injustice. We thank Comptroller Brooks and the OCC team for upholding the principle of free and fair access to capital today and acting on behalf of all Americans, including the Alaskans we represent. This is not a partisan issue only affecting oil and gas. This rule is to ensure fair access to banking services for all, not just for favored industries.”
“Fair access to financial services, credit, and capital are essential to our economy,” said Acting Comptroller of the Currency Brian P. Brooks. “This proposed rule would ensure that banks meet their responsibility to provide their services fairly since they enjoy special privilege and powers because if the system fails to provide fairness to all, it cannot be a source of strength for any.”
According to the OCC, the proposal builds upon the fundamental principle of nondiscrimination, under Title III of the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010, and would prevent banks—alone or in coordination with others—from limiting fair access to banking through broad-based, categorical decisions against entire categories of customers, rather than individual and objective risk assessment.
The rule will next be published in the federal register, starting a comment period that will close by January 4, 2021. After the OCC considers the comments, the office will publish a final rule.
- In December of 2017, President Donald Trump signed the Tax Cuts and Jobs Act, which included a title authored by Senator Murkowski to authorize energy development in a small portion of the non-wilderness 1002 area of ANWR.
- In December of 2018, the Bureau of Land Management (BLM) released the draft environmental impact statement (EIS) for the oil and gas leasing program in ANWR.
- In January of 2020, sixteen Democratic U.S. senators sent a letter to the leaders of the nation’s fifteen largest banks, urging them to withhold funding from Arctic oil and gas projects.
- Also in January, Mayor Harry Brower Jr. of Alaska’s North Slope Borough penned an op-ed condemning the “subtly racist attitude” of some of the banks blocking economic opportunities for Alaska Native peoples who reside on the North Slope.
- In April of 2020, Sullivan and President Trump criticized the actions of the banks in a press conference at the White House.
- In May of 2020, the Alaska delegation sent a letter with more than 30 of their congressional colleagues to President Trump urging the administration to take action against large American financial institutions for excluding American energy companies and their workers.
- In June of 2020, Senators Sullivan and Murkowski, and Congressman Young, sent a letter to Chairman Jerome Powell and Vice Chair Randy Quarles of the Federal Reserve, Acting U.S. Comptroller of Currency Brian Brooks, and Chairwoman Jelena McWilliams of the Federal Deposit Insurance Corporation, urging these officials to consider regulatory action and oversight of large American financial institutions following the actions against Arctic communities.
- On July 24, 2020, Comptroller of the Currency Brooks sent a response letter to the delegation stating, “As requested, the OCC will take a serious look at these banks’ actions. The OCC intends to seek additional information from the banks involved to understand the rationale for these decisions as well as their effect on our national economy and local communities. This will, in turn, help us analyze whether these actions violate any duty or obligation under federal laws.”
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