Editor’s Note: Adam Pack from the Daily Caller News Foundation broke the story on this introduction
WASHINGTON, D.C. – Yesterday, U.S. Congressmen Andy Barr (KY-06) and Ritchie Torres (NY-15) introduced the Financial Integrity and Regulation Management (FIRM) Act, bipartisan legislation to prohibit federal banking regulators from using “reputational risk” as a justification to deny financial services to lawful businesses or individuals.
This legislation directly addresses the regulatory abuses that occurred under initiatives like Operation Choke Point, where agencies pressured banks to cut off services to legally operating businesses based on political or social factors—rather than safety and soundness concerns. The FIRM Act ensures that banking supervision remains focused on legitimate financial risks, not political agendas.
“For too long, unelected regulators have used the vague and subjective concept of reputational risk to push political ideology under the guise of bank supervision,” said Congressman Barr. “The FIRM Act restores neutrality and integrity to our financial regulatory system and protects the right of all Americans to access banking services without fear of unlawful discrimination.”
"The FIRM Act is about restoring fairness and objectivity to our financial system,” said Congressman Torres. “No lawful business should be denied banking services based on subjective intent or shifting political winds. Financial regulation should be grounded in objective risk, not politicized judgments about reputational harm. I’m proud to co-lead this bipartisan legislation to ensure access to banking is determined by sound business practices — not partisan pressure."
“Debanking federally legal businesses and law-abiding citizens is un-American, but unfortunately, we’ve seen federal banking regulators abuse ‘reputational risk’ to carry out political agendas and force financial institutions to cut off access to financial services for Americans. Fortunately, the Trump administration has taken action to end the use of this subjective tool, and the FIRM Act – which advanced out of the Senate Banking Committee – will eliminate all references to reputational risk in regulatory supervision. I’m grateful to Congressman Barr for introducing the House companion legislation and leading the effort to help end this discriminatory practice,” said Chairman Tim Scott.
“Debanking is a dangerous trend that erodes trust in our financial system. Banks should never be weaponized, silencing lawful speech, or discriminating against Americans for their beliefs,” Conference Chairwoman McClain said. “I appreciate Rep. Barr for leading this effort to hold financial institutions accountable. They cannot deny service without a legitimate, legal reason.”
“BPI supports the FIRM Act and is grateful to the House and Senate for working to eliminate one of the worst aspects of the opaque bank supervision regime. The FIRM Act is an important first step in refocusing the federal banking agencies on assessing material financial risk rather than dictating how banks manage their operations, governance and reputations. The result will be a safer and more efficient banking system that allows banks to make independent business decisions.” – Greg Baer, President and CEO, Bank Policy Institute
“We applaud the introduction of the FIRM Act in the House and thank Reps. Barr and Torres for their leadership on this issue. The FIRM Act would remove ‘reputational risk’ as a component of federal supervision when determining a financial institution’s safety and soundness, ensuring banks have the flexibility they need to serve their communities without political interference. We look forward to working with Rep. Barr and other stakeholders to move this commonsense bill forward to protect bank customers from regulatory overreach.” -Rob Nichols, President and CEO, American Bankers Association
"We thank Congressmen Barr and Torres for introducing the Financial Integrity and Regulation Management Act. This bill provides much-needed clarity for a more predictable regulatory framework, allowing banks to better serve their customers while maintaining a safe and sound financial system. Anchoring supervision in objective financial and material risk measures is a vital move in the right direction."-Kevin Fromer, CEO, Financial Services Forum
“Debanking is a pernicious practice, impacting so many in the digital asset industry and beyond. Rep. Barr’s Fair Access to Banking Act will help ensure lawful companies and individuals have access to bank accounts, allowing them to pay rent, pay taxes, and pay employees – a fundamental fairness that is currently missing in the United States.” – Blockchain Association CEO Kristin Smith
“The FIRM Act would provide greater regulatory clarity and be a strong step forward in protecting banking services for small business providers of financial services that are licensed, regulated and examined by the states and governed by federal laws.” Johnny Whiteside, President, National Pawnbrokers Association
The bill mandates that all federal banking agencies eliminate reputational risk as a consideration in supervisory guidance, rules, and enforcement actions. Agencies will be required to report to Congress within 180 days confirming compliance and detailing internal policy changes resulting from the law.
Chairman Tim Scott (R-SC) has introduced companion legislation in the U.S. Senate.
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