Fair Access to Banking Act

Subjects: Finance and Financial Sector


<html><body><pre>[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2743 Introduced in House (IH)]

&lt;DOC&gt;






118th CONGRESS
  1st Session
                                H. R. 2743

To amend the Federal Reserve Act to prohibit certain financial service 
    providers who deny fair access to financial services from using 
    taxpayer funded discount window lending programs, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 20, 2023

Mr. Barr (for himself, Mr. Posey, Mr. Sessions, Mr. Meuser, Mr. Nunn of 
   Iowa, Mr. Ogles, Mr. DesJarlais, Mr. Bergman, Mr. Bishop of North 
 Carolina, Mr. Bacon, Mr. Amodei, Mr. Huizenga, Mr. Carter of Georgia, 
 Mr. Wittman, Mr. Moolenaar, Mr. Timmons, Mr. Hudson, Mr. Fallon, Mr. 
Fitzgerald, Mr. Mooney, Mr. Gosar, Mr. Williams of Texas, Ms. Stefanik, 
 Mrs. Cammack, Mr. Issa, Mr. Reschenthaler, Mrs. Lesko, Mr. Rose, Mr. 
Emmer, Mr. Babin, Mr. Clyde, Mr. Wilson of South Carolina, Mr. Walberg, 
  Mr. Zinke, Mr. Burlison, Mr. Allen, Ms. Van Duyne, Mr. Gimenez, Mr. 
 Lamborn, Mr. LaMalfa, Mr. Norman, and Mr. Dunn of Florida) introduced 
 the following bill; which was referred to the Committee on Financial 
                                Services

_______________________________________________________________________

                                 A BILL


 
To amend the Federal Reserve Act to prohibit certain financial service 
    providers who deny fair access to financial services from using 
    taxpayer funded discount window lending programs, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Access to Banking Act''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) article I of the Constitution of the United States 
        guarantees the people of the United States the right to enact 
        public policy through the free and fair election of 
        representatives and through the actions of State legislatures 
        and Congress;
            (2) financial institutions rightly objected to the 
        Operation Choke Point initiative through which certain 
        government agencies pressured financial institutions to cut off 
        access to financial services to lawful sectors of the economy;
            (3) in response to pressure from advocates whose policy 
        objectives are served when financial institutions deny certain 
        customers access to financial services, financial institutions 
        are now, however, increasingly employing subjective, category-
        based evaluations to deny certain persons access to financial 
        services;
            (4) this privatization of the discriminatory practices 
        underlying Operation Choke Point by financial institutions 
        represents as great a threat to the national economy, national 
        security, and the soundness of banking and financial markets in 
        the United States as Operation Choke Point itself;
            (5) financial institutions are supported by the United 
        States taxpayers and enjoy significant privileges in the 
        financial system of the United States and should not be 
        permitted to act as de facto regulators or unelected 
        legislators by withholding financial services to otherwise 
        credit worthy businesses based on subjective political reasons, 
        bias or prejudices;
            (6) financial institutions are not well-equipped to balance 
        risks unrelated to financial exposures and the operations 
        required to deliver financial services;
            (7) the United States taxpayers came to the aid for large 
        financial institutions during the great recession of 2008 
        because they were deemed too important to the national economy 
        to be permitted to fail;
            (8) when a financial institution predicates the access to 
        financial services of a person on factors or information (such 
        as the lawful products a customer manufactures or sells or the 
        services the customer provides) other than quantitative, 
        impartial risk-based standards, the financial institution has 
        failed to act consistent with basic principles of sound risk 
        management and failed to provide fair access to financial 
        services;
            (9) financial institutions have a responsibility to make 
        decisions about whether to provide a person with financial 
        services on the basis of impartial criteria free from prejudice 
        or favoritism;
            (10) while fair access to financial services does not 
        obligate a financial institution to offer any particular 
        financial service to the public, or to operate in any 
        particular geographic area, or to provide a service the 
        financial institution offers to any particular person, it is 
        necessary that--
                    (A) the financial services a financial institution 
                chooses to offer in the geographic areas in which the 
                financial institution operates be made available to all 
                customers based on the quantitative, impartial risk-
                based standards of the financial institution, and not 
                based on whether the customer is in a particular 
                category of customers;
                    (B) financial institutions assess the risks posed 
                by individual customers on a case-by-case basis, rather 
                than category-based assessment; and
                    (C) financial institutions implement controls to 
                manage relationships commensurate with these risks 
                associated with each customer, not a strategy of total 
                avoidance of particular industries or categories of 
                customers;
            (11) financial institutions are free to provide or deny 
        financial services to any individual customer, but first, the 
        financial institutions must rely on empirical data that are 
        evaluated consistent with the established, impartial risk-
        management standards of the financial institution; and
            (12) anything less is not prudent risk management and may 
        result in unsafe or unsound practices, denial of fair access to 
        financial services, cancelling, or eliminating certain 
        businesses in society, and have a deleterious effect on 
        national security and the national economy.

SEC. 3. PURPOSE.

    The purposes of this Act are to--
            (1) ensure fair access to financial services and fair 
        treatment of customers by financial service providers, 
        including national and State banks, Federal savings 
        associations, and State and Federal credit unions;
            (2) ensure financial institutions conduct themselves in a 
        safe and sound manner, comply with laws and regulations, treat 
        their customers fairly, and provide fair access to financial 
        services;
            (3) protect against financial institutions being able to 
        impede otherwise lawful commerce and thereby achieve certain 
        public policy goals;
            (4) ensure that persons involved in politically unpopular 
        businesses but that are lawful under Federal law receive fair 
        access to financial services under the law; and
            (5) ensure financial institutions operate in a safe and 
        sound manner by making judgments and decisions about whether to 
        provide a customer with financial services on an impartial, 
        individualized risk-based analysis using empirical data 
        evaluated under quantifiable standards.

SEC. 4. ADVANCES TO INDIVIDUAL MEMBER BANKS.

    (a) Member Banks.--Section 10B of the Federal Reserve Act (12 
U.S.C. 347b) is amended by adding at the end the following:
    ``(c) Prohibition on Use of Discount Window Lending Programs.--No 
member bank with more than $100,000,000,000 in total consolidated 
assets, or subsidiary of the member bank, may use a discount window 
lending program if the member bank or subsidiary refuses to do business 
with any person who is in compliance with the law, including section 8 
of the Fair Access to Banking Act.''.
    (b) Insured Depository Institutions.--Section 8(a)(2)(A) of the 
Federal Deposit Insurance Act (12 U.S.C. 1818(a)(2)(A)) is amended--
            (1) in clause (ii), by striking ``or'' at the end;
            (2) in clause (iii), by striking the comma at the end and 
        inserting ``; or''; and
            (3) by adding at the end the following:
                            ``(iv) an insured depository institution 
                        with more than $100,000,000,000 in total 
                        consolidated assets, or subsidiary of the 
                        insured depository institution, that refuses to 
                        do business with any person who is in 
                        compliance with the law, including section 8 of 
                        the Fair Access to Banking Act.''.
    (c) Nonmember Banks, Trust Companies, and Other Depository 
Institutions.--Section 13 of the Federal Reserve Act (12 U.S.C. 342) is 
amended by inserting ``Provided further, That no such nonmember bank or 
trust company or other depository institution with more than 
$100,000,000,000 in total consolidated assets, or subsidiary of such 
nonmember bank or trust company or other depository institution, may 
refuse to do business with any person who is in compliance with the 
law, including, including section 8 of the Fair Access to Banking 
Act:'' after ``appropriate:''.

SEC. 5. PAYMENT CARD NETWORKS.

    (a) Definition.--In this section, the term ``payment card network'' 
has the meaning given the term in section 921(c) of the Electronic Fund 
Transfer Act (15 U.S.C. 1693o-2(c)).
    (b) Prohibition.--No payment card network, including a subsidiary 
of a payment card network, may, directly or through any agent, 
processor, or licensed member of the network, by contract, requirement, 
condition, penalty, or otherwise, prohibit or inhibit the ability of 
any person who is in compliance with the law, including section 8 of 
this Act, to obtain access to services or products of the payment card 
network because of political or reputational risk considerations.
    (c) Civil Penalty.--Any payment card network that violates 
subsection (b) shall be assessed a civil penalty by the Comptroller of 
the Currency of not more than 10 percent of the value of the services 
or products described in that subsection, not to exceed $10,000 per 
violation.

SEC. 6. CREDIT UNIONS.

    Section 206(b)(1) of the Federal Credit Union Act (12 U.S.C. 1786) 
is amended by inserting ``or is refusing or has refused, or has a 
subsidiary that is refusing or has refused, to do business with any 
person who is in compliance with the law, including section 8 of the 
Fair Access to Banking Act,'' after ``as an insured credit union,''.

SEC. 7. USE OF AUTOMATED CLEARING HOUSE NETWORK.

    (a) Definitions.--In this section:
            (1) Covered credit union.--The term ``covered credit 
        union'' means--
                    (A) any insured credit union, as defined in section 
                101 of the Federal Credit Union Act (12 U.S.C. 1752); 
                or
                    (B) any credit union that is eligible to make 
                application to become an insured credit union under 
                section 201 of the Federal Credit Union Act (12 U.S.C. 
                1781).
            (2) Member bank.--The term ``member bank'' has the meaning 
        given the term in the third undesignated paragraph of the first 
        section of the Federal Reserve Act (12 U.S.C. 221).
    (b) Prohibition.--No covered credit union, member bank, or State-
chartered non-member bank with more than $100,000,000,000 in total 
consolidated assets, or a subsidiary of the covered credit union, 
member bank, or State-chartered non-member bank, may use the Automated 
Clearing House Network if that member bank, credit union, or subsidiary 
of the member bank or credit union, refuses to do business with any 
person who is in compliance with the law, including section 8 of this 
Act.

SEC. 8. FAIR ACCESS TO FINANCIAL SERVICES.

    (a) Definitions.--In this section:
            (1) Bank.--The term ``bank''--
                    (A) means an entity for which the Office of the 
                Comptroller of the Currency is the appropriate Federal 
                banking agency, as defined in section 3 of the Federal 
                Deposit Insurance Act (12 U.S.C. 1813); and
                    (B) includes--
                            (i) member banks;
                            (ii) non-member banks;
                            (iii) covered credit unions;
                            (iv) State-chartered non-member banks; and
                            (v) trust companies.
            (2) Covered bank.--
                    (A) In general.--The term ``covered bank'' means a 
                bank that has the ability to--
                            (i) raise the price a person has to pay to 
                        obtain an offered financial service from the 
                        bank or from a competitor; or
                            (ii) significantly impede a person, or the 
                        business activities of a person, in favor of or 
                        to the advantage of another person.
                    (B) Presumption.--
                            (i) In general.--A bank shall not be 
                        presumed to be a covered bank if the bank has 
                        less than $100,000,000,000 in total assets.
                            (ii) Rebuttable presumption.--
                                    (I) In general.--A bank is presumed 
                                to be a covered bank if the bank has 
                                $100,000,000,000 or more in total 
                                assets.
                                    (II) Rebuttal.--A bank that meets 
                                the criteria under subclause (I) can 
                                seek to rebut this presumption by 
                                submitting to the Office of the 
                                Comptroller of the Currency written 
                                materials that, in the judgement of the 
                                agency, demonstrate the bank does not 
                                meet the definition of covered bank.
            (3) Covered credit union.--The term ``covered credit 
        union'' means--
                    (A) any insured credit union, as defined in section 
                101 of the Federal Credit Union Act (12 U.S.C. 1752); 
                or
                    (B) any credit union that is eligible to make 
                application to become an insured credit union under 
                section 201 of the Federal Credit Union Act (12 U.S.C. 
                1781).
            (4) Deny.--The term ``deny'' means to deny or refuse to 
        enter into or terminate an existing financial services 
        relationship with a person.
            (5) Fair access to financial services.--The term ``fair 
        access to financial services'' means persons engaged in 
        activities lawful under Federal law are able to obtain 
        financial services at banks without impediments caused by a 
        prejudice against or dislike for a person or the business of 
        the customer, products or services sold by the person, or 
        favoritism for market alternatives to the business of the 
        person. Refusing to provide or continue to provide financial 
        services to a person because the person engaged in rude or 
        harassing conduct toward an employee of a bank is not a 
        violation of this section.
            (6) Financial service.--The term ``financial service'' 
        means a financial product or service, including--
                    (A) commercial and merchant banking;
                    (B) lending;
                    (C) financing;
                    (D) leasing;
                    (E) cash, asset and investment management and 
                advisory services;
                    (F) credit card services;
                    (G) payment processing;
                    (H) security and foreign exchange trading and 
                brokerage services; and
                    (I) insurance products.
            (7) Member bank.--The term ``member bank'' has the meaning 
        given the term in the third undesignated paragraph of the first 
        section of the Federal Reserve Act (12 U.S.C. 221).
    (b) Requirements.--
            (1) In general.--To provide fair access to financial 
        services, a covered bank (including a subsidiary of a covered 
        bank), except as necessary to comply with another provision of 
        law--
                    (A) shall make each financial service it offers 
                available to all persons in the geographic market 
                served by the covered bank on proportionally equal 
                terms;
                    (B) may not deny any person a financial service the 
                covered bank offers unless the denial is justified by 
                such quantified and documented failure of the person to 
                meet quantitative, impartial risk-based standards 
                established in advance by the covered bank;
                    (C) may not deny, in coordination with or at the 
                request of others, any person a financial service the 
                covered bank offers; and
                    (D) shall, when denying any person financial 
                services the covered bank offers, provide written 
                justification to the person explaining the basis for 
                the denial, including any specific laws or regulations 
                the covered bank believes are being violated by the 
                person or customer, if any.
            (2) Justification requirement.--A justification described 
        in paragraph (1)(D) may not be based solely on the reputational 
        risk to the covered bank.
    (c) Cause of Action for Violations of This Section.--
            (1) In general.--Notwithstanding any other provision of 
        law, a person may commence a civil action in the appropriate 
        district court of the United States against any covered bank 
        that violates or fails to comply with the requirements under 
        this Act, for harm that person suffered as a result of such 
        violation.
            (2) No exhaustion.--It shall not be necessary for a person 
        to exhaust its administrative remedies before commencing a 
        civil action under this Act.
            (3) Damages.--If a person prevails in a civil action under 
        this Act, a court shall award the person--
                    (A) reasonable attorney's fees and costs; and
                    (B) treble damages.
                                 &lt;all&gt;
</pre></body></html>