In Operation Choke Point, the Justice Department is targeting lawful industries with investigations designed to dramatically increase their paperwork burdens -- including industries seemingly accorded constitutional protection against undue burdens, like pornography (First Amendment), firearms (Second Amendment), and dating services (freedom of intimate association).
Reason Magazine reports on its assault on the porn industry and how banks are closing the checking accounts of porn performers as a result:
Despite being in good financial standing, adult film performers and others in the porn industry have had bank accounts abruptly terminated—and the U.S. Department of Justice (DOJ) may have had something to do with it.
Under "Operation Choke Point," the DOJ and its allies are going after legal but subjectively undesirable business ventures by pressuring banks to terminate their bank accounts or refuse their business. . .Targeted business categories so far have included payday lenders, ammunition sales, dating services, purveyors of drug paraphernalia, and online gambling sites. Operation Chokepoint is flooding payments companies that provide processing service to those industries with subpoenas, civil investigative demands, and other burdensome and costly legal demands," wrote Jason Oxman, CEO of the Electronic Transactions Association, at The Hill.
'The theory behind this enforcement program . . .: increase the legal and compliance costs of serving certain disfavored merchant categories, and payments companies will simply stop providing service to such merchants. And it’s working—payments companies across the country are cutting off service to categories of merchants . . .Thus far, payday lenders have been the most frequent target. . .'
Last week, adult film actress Teagan Presley and an unknown number of others in the porn industry received notices that their Chase Bank accounts were being abruptly terminated. When Presley went to the bank in person to ask why, she was told it’s because she’s considered 'high risk.'" . . Operation Choke Point represents an incredible abuse of regulatory power. In a recent American Banker op-ed, former Federal Deposit Insurance Corp. Chairman William M. Isaac called it "a direct assault on the democratic system and free-market economy." . . In a March 2013 hearing before a Senate Banking subcommittee, Sen. David Vitter (R-La.) pointed out the obvious: that DOJ has "no statutory authority" to be doing this.
Operation Chokepoint is also targeting firearms dealers, drawing the ire of Second Amendment advocates. As one angrily put it:
The current . . . Attorney General, who has been found to be in contempt of Congress after failing to provide subpoenaed documents in the Fast and Furious scandal, which his department was involved in trafficking thousands of guns across the US/Mexico border that resulted in the deaths of hundreds of Mexicans and at least two federal agents, has now been caught in yet another scandal. For the past several months, the DOJ has been putting pressure on banks, in a program referred to as Operation ChokePoint, to not provide services that the Justice Department is targeting politically. Among those businesses are gun stores.
Does anyone know how the Justice Department claims to reconcile these chilling investigations with the First or Second Amendments? The First Amendment is sometimes offended by deliberately burdensome investigations even in the civil context, when the investigation is aimed at a category of speech or speakers, see, e.g., White v. Lee, 227 F.3d 1214 (9th Cir. 2000). And as UCLA Law Professor Eugene Volokh and firearms law expert David Kopel have noted, restrictions can violate the Second Amendment even when they are aimed at sellers, rather than purchasers, of firearms? So there would seem to be serious constitutional issues at stake here. Yet I see little legal commentary on the subject so far.