Eric Holder’s Latest Scandal: “Operation Choke Hold” – Issa Charges Abuse of Power
What would motivate Attorney General Eric Holder to secretly shut down a sector of the lending industry that serves what has been determined by regulators to be a legitimate service to a segment of the lending market?
A strongly worded letter was sent to Mr. Holder jointly by Congressman Darrell Issa, (R-CA), Chairman of the House Oversight and Government Reform Committee, and Congressman Jim Jordan (R-OH), Chairman of the Economic Growth subcommittee is seeking to answer that and other questions. The letter accused Holder’s Justice Department of abuse of power and intimidating banks in this latest scandal, “Operation Choke Point.”
The letter states, “[t]he [House Oversight and Government Reform] Committee is concerned that both the goal and mechanisms of Operation Choke Point may constitute a serious mismanagement and abuse of the Department’s FIRREA [Financial Institution Reform and Recovery Act of 1989] authority.”
On Wednesday, Breitbart News reported that the Obama administration launched ‘Operation Choke Point’ out of the Department of Justice in 2013 in an effort to destroy three areas of the private lending industry. Those areas targeted included third-party payment processor, online lenders and payday lenders.
Issa and Jordan asked the Department of Justice to provide the House Oversight and Government Reform Committee with “[a]ll documents and communications since January 1, 2011 referring or relating to ‘Operation Choke Point’” by January 22, 2014.
They wrote that “There is evidence that the true goal of Operation Choke Point is to target online lenders and the payment processors who serve them.” The continued, “[t]he extraordinary breadth of the Department’s dragnet prompts concern that the true goal of Operation Choke Point is not to cut off actual fraudsters’ access to the financial system, but rather to eliminate legal financial services to which the Department objects.”
Issa and Jordan also confronted Holder regarding DOJ’s tactics, writing “[i]t appears the Department has indiscriminately targeted an access point to the financial system that countless legitimate merchants rely upon simply because it is ‘faster’ than targeting the actual perpetrators of fraud.” DOJ is “needlessly punishing good actors with the bad, and threatening legitimate merchants.”
In Holder’s defense, The Wall Street Journal reported Thursday that “[o]fficials at the DOJ have said the crackdown is not aimed specifically at online lending, but rather a wide range of allegedly fraudulent merchants.”
The response by DOJ to the letter and the requests within were quite non-committal, replying, according to the Wall Street Journal that “[a] Justice Department official said, ‘We’ve received the letter and are reviewing it.’”
Given Eric Holder’s track record, a swift, honest, and complete response may not be forthcoming.
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