August 03, 2014 02:12 PM UTC

Operation Choke Point – Denying the Dollars

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• by: kwtree

Victor “Everyone Loves” Head is all choked up about a Federal program, Operation Choke Point (OCP). In an interview with Jennifer Kerns, Head claimed that credit card services for Pueblo Freedom and Rights (PFR) were suddenly cut off the week before the recall elections in 2013.  Other right –wing groups  also reported sudden and mysterious severance of their banking relationships, and an astroturf organization, USCC, has been set up to take reports of suspected OCP interference.  The funders of USCC are unknown, but have strong ties to conservative groups.

“Operation Choke Point” overreach is the latest generator of anti-Obama, anti-AG Holder outrage in the right wing blogosphere. Look for it to become the next big attack on the Obama administration and Attorney General Holder, with Pueblo’s own “grassroots hero”, Victor Head, prominently featured as the poster boy. Here is your daily requirement of irony: (Below, right, is Victor Head of PFR, a recall organizer, and current Pueblo Clerk candidate, posing  in 2013 with El Paso Sheriff Terry Maketa, himself recently the target of a failed recall for sexual and  administrative offenses.)

But…Is OCP  a real “scandal”? Is it “overreach”? Is OCP the bank version of NSA spying on ordinary Americans?

William Isaac , columnist for “The Hill” wrote:

The DOJ launched Operation Choke Point in 2013, working in concert with a wide range of agencies including the FTC, FDIC, OCC, CFPB, and FBI.  The stated goal of Operation Choke Point was to “sensitize” the banking industry to the risk of doing business with legal but “undesirable” businesses through the issuance of non-public FIRREA subpoenas ( as opposed to enforcement actions where the authority could be challenged).

Regulators and the DOJ highlight some two-dozen businesses that they consider “high risk” or “undesirable”, including ammunition dealers, producers of adult films, check cashers, short-term unsecured loans (commonly called “payday loans”), telemarketers, firearms/fireworks vendors, raffles, pharmaceutical firms, life-time guarantees, surveillance equipment firms, and home-based charities.

I am all for the DOJ monitoring some of these shady businesses, and if they find illegal action, stopping it. I’ve had hundreds of dollars deducted from my own bank account via a scam for a non-existent health insurance card company, prior to the ACA’s enactment. Had someone taken the money from my purse, there would have been criminal charges; however, because it took place in the obscure world of third-party bank businesses and fly-by-night internet scam artists, it proved impossible to stop or to get redress. I'll never get that money back.

 I don’t want felons and violent offenders to be able to order firearms online.  Pharmaceutical firms that market under-the-counter medications need some oversight to protect public health.  Online child pornography businesses need oversight of their bank transactions so that they can be shut down and punished. This is the DOJ appropriately protecting the public.

The grey area is that most of these are legal businesses, at least until there is proof of criminal activity. Where I agree with the right wing outrage, (and the possibility of being on the same side of any issue as Victor Head makes my own gag reflex kick in) is on this point:  there is little or no oversight on the overseers.  People are losing access to their own money, without a warrant, without a trial, without a civil action.

Liberals may applaud the restrictions on shady businesses, and on right-wing political groups that benefit from dark money. However,  there is no guarantee that the OCP’s possible overreach stops there. Like the IRS scandal, we may well find that progressive organizations are also targeted as much or more than conservatives.   How will the Department of Justice be made accountable and transparent, when the agency is now unaccountable and its transactions are hidden from the public?

The United States Congress has initiated legislation on this issue. House Bill 4986, the End Operation Choke Point Act of 2014,  was introduced with bipartisan support in June 2014. It was referred to the Committee on Financial Services, where it sits. Given the dismal history of Congress in passing legislation, govtrack.us gives it only a 26% chance of being signed into law.  I frankly don’t have the financial expertise to understand how or if this bill will provide oversight and transparency on OCP, so I’m not going to try to evaluate the legislation.

Given the people promoting the right wing outrage over OCP, most critical thinkers are justifiably skeptical of the claims of OCP overreach. Jennifer Kerns, aka California Partygirl, aka anti-recall spox, aka California Republican media consultant, now a Washington pundit, wrote in  “TheBlaze.com” that Operation Choke Point,  (OCP): “Evidence has emerged of Operation Choke Point targeting other Republicans on or before Election Day.”  Victor Head has a record of rummaging through post office trash for ballots to bolster his claims of possible election fraud.

Jennifer Kerns would be an expert on dark money funding of political organizations, from the inside – Magpul funded $150,000 for  the organization “Free Colorado”, which in turn funded  the recall efforts against  Senator Morse in Colorado Springs.  Free Colorado was promoted by the Koch brothers on the AFP-Colorado website. Kerns was the spokesperson for Basic Freedom Defense Fund, and helped to promote “Free Colorado”  anti-recall efforts.

I don’t find the outrage over OCP to be credible, because it comes from these sources. However, I’m aware of and concerned about NSA and IRS overreach, during the course of legitimate agency endeavors. Progressives shouldn't dismiss concerns about government stomping on privacy rights, just because they come from a conservative direction. I’d like to see more transparency and accountability of OCPs efforts to curtail borderline-criminal financial transactions. I just don’t quite know how that balances with civil-liberties concerns.

UPDATE:  A Huffington Post article by Zach Carter posits that OCP is an effective way to curb money laundering schemes.  Similar laws were put in place during the Bush administration, and resulted in, for example, Wachovia Bank paying $150 million to resolve charges that it laundered money from drug cartels.

Elizabeth Warren, Jeff Merkely, and Dick Durbin like the OCP program.