IB 
Union Calendar No. 131 
119TH CONGRESS 
1ST SESSION H. R. 2702 
[Report No. 119–164] 
To curtail the political weaponization of Federal banking agencies by elimi-
nating reputational risk as a component of the supervision of depository 
institutions. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 8, 2025 
Mr. BARR (for himself, Mr. TORRES of New York, Mrs. MCCLAIN, Mr. LUCAS, 
Mr. LOUDERMILK, Mr. ROSE, Mrs. WAGNER, Mr. STUTZMAN, Mr. 
TIMMONS, Mr. FITZGERALD, Mr. MOORE
of North Carolina, Mr. 
MESSMER, Mr. OGLES, Mr. DOWNING, Mr. SESSIONS, Mr. LAMALFA, 
and Mr. GROTHMAN) introduced the following bill; which was referred to 
the Committee on Financial Services 
JUNE 20, 2025 
Additional sponsors: Mr. WILLIAMS of Texas, Mr. SCHMIDT, and Mr. 
GARBARINO 
JUNE 20, 2025 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on April 8, 2025] 
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A BILL 
To curtail the political weaponization of Federal banking 
agencies by eliminating reputational risk as a component 
of the supervision of depository institutions. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Financial Integrity and 
Regulation Management Act’’ or the ‘‘FIRM Act’’. 
SEC. 2. FINDINGS. 
Congress finds that— 
(1) the primary objective of financial regulation 
and supervision by the Federal banking agencies is to 
promote safety and soundness of depository institu-
tions; 
(2) all federally legal businesses and law-abiding 
citizens regardless of political ideology should have 
equal opportunity to obtain financial services and 
should not face unlawful discrimination in obtaining 
such services; 
(3) financial service providers are private enti-
ties entitled to provide services to whichever customers 
they so choose, provided that those decisions do not 
violate the law; 
(4) financial service providers should strive to 
ensure that all business decisions are based on factors 
free from unlawful prejudice or political influence; 
(5) the use of reputational risk in supervisory 
frameworks encourages Federal banking agencies to 
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regulate depository institutions based on the subjective 
view of negative publicity and provides cover for the 
agencies to implement their own political agenda un-
related to the safety and soundness of a depository in-
stitution; 
(6) Federal banking agencies have in fact used 
reputational risk to limit access of federally legal 
businesses and law-abiding citizens to financial serv-
ices in 2018 when the Federal Deposit Insurance Cor-
poration 
acknowledged 
that 
the 
agency 
used 
reputational risk reviews to limit access to financial 
services by certain industries, commonly known as 
‘‘Operation Choke Point’’; and 
(7) reputational risk does not appear in any 
statute and is an unnecessary and improper use of 
supervisory authority that does not contribute to the 
safety and soundness of the financial system. 
SEC. 3. DEFINITIONS. 
In this Act: 
(1) DEPOSITORY INSTITUTION.—The term ‘‘de-
pository institution’’— 
(A) has the meaning given the term in sec-
tion 3 of the Federal Deposit Insurance Act (12 
U.S.C. 1813); and 
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(B) includes an insured credit union, as 
such term is defined in section 101 of the Federal 
Credit Union Act (12 U.S.C. 1752). 
(2) FEDERAL
BANKING
AGENCY.—The term 
‘‘Federal banking agency’’— 
(A) has the meaning given the term in sec-
tion 3 of the Federal Deposit Insurance Act (12 
U.S.C. 1813); and 
(B) includes— 
(i) the National Credit Union Admin-
istration; and 
(ii) the Bureau of Consumer Financial 
Protection. 
(3) FOREIGN
TERRORIST
ORGANIZATION.—The 
term ‘‘foreign terrorist organization’’ means a foreign 
organization that is designated by the Secretary of 
State in accordance with section 219 of the Immigra-
tion and Nationality Act (8 U.S.C. 1189). 
(4) 
REPUTATIONAL
RISK.—The 
term 
‘‘reputational risk’’ means the potential that negative 
publicity or negative public opinion regarding a de-
pository institution’s business practices, whether true 
or not, will cause a decline in confidence in the insti-
tution or a decline in the customer base, costly litiga-
tion, or revenue reductions or otherwise adversely im-
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pact the depository institution. The previous sentence 
does not apply to negative publicity or negative pub-
lic opinion regarding an institution’s business prac-
tices where such practices involve unlawful trans-
actions in connection with state sponsors of terrorism 
or foreign terrorist organizations. 
(5) STATE SPONSORS OF TERRORISM.—The term 
‘‘state sponsors of terrorism’’ means a country, the 
government of which has been determined by the Sec-
retary of State to have repeatedly provided support 
for acts of international terrorism, for purposes of— 
(A) section 1754(c)(1)(A)(i) of the Export 
Control Reform Act of 2018 (50 U.S.C. 
4813(c)(1)(A)(i)); 
(B) section 620A of the Foreign Assistance 
Act of 1961 (22 U.S.C. 2371); 
(C) section 40(d) of the Arms Export Con-
trol Act (22 U.S.C. 2780(d)); or 
(D) any other provision of law. 
SEC. 4. REMOVAL OF REPUTATIONAL RISK AS A CONSIDER-
ATION IN THE SUPERVISION OF DEPOSITORY 
INSTITUTIONS. 
Each Federal banking agency shall remove from any 
guidance, rule, examination manual, or similar document 
established by the agency any reference to reputational risk, 
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Union Calendar No. 131 
119TH CONGRESS 
1ST SESSION 
H. R. 2702 
[Report No. 119–164] 
A BILL 
To curtail the political weaponization of Federal 
banking agencies by eliminating reputational risk 
as a component of the supervision of depository 
institutions. 
JUNE 20, 2025 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
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