Culture Wars Hit Capital One
Capital One, a Virginia-based bank holding company, has been hit amid the ongoing culture wars sweeping the United States after its New York deposits were frozen for failing to submit anti-corruption plans. -required discrimination, causing a decline in stock. value.
The New York City comptroller said Thursday he joined the mayor’s office and the Department of Finance in freezing city deposits at Capital One and KeyBank, a Cleveland-based retail banking firm. The two banks collectively hold $17.2 million in municipal deposits.
The shutdown was the result of a failure to disclose required reporting on non-discrimination policies and comes as several states, including Texas and Florida, have stopped doing business with the banks due to practices ” awake”.
“The views we heard today from New Yorkers who have faced discrimination in the process of opening or closing accounts, and from frontline banking staff who have faced illegal practices and abusive, should give us all pause,” Assistant Comptroller for Policy Annie Levers said in a statement. .
Besides Capital One and KeyBank, three other banks – Finance Bank, PNC Bank and Wells Fargo – have had their deposits halted by the Banking Commission. However, these three banks do not currently hold any City deposits.
Shaquana Chaneyfield, deputy press secretary for the New York Comptroller, said Newsweek that the stoppage of deposits only concerns the funds of the municipal agency. New Yorkers are still free to continue depositing money in banks.
“We’ve heard from many residents concerned that taxpayers’ money is going to banks that fund predatory lending, fossil fuel extraction and gun manufacturing – and support the idea of a public bank that would put rather those dollars serving our communities. The Banking Commission can and should take on a greater role in ensuring that the city only does business with banks that demonstrate their commitment to community reinvestment and fair lending practices” , Levers said in the NYC Comptroller statement.
New York City Comptroller Brad Lander said banks doing business in New York must demonstrate that they are responsible stewards of public funds and act responsibly in communities. Lander explained that the five banks failed to comply with the NYC Banking Commission’s designation process, despite having had “several” opportunities to do so, leading to the conclusion that they were not actively taking measures to combat discrimination in their operations.
However, Florida and Texas have chosen the opposite direction when it comes to holding banks and financial institutions accountable for failing to uphold conservative values in both states.
In 2021, Texas enacted a law prohibiting certain state government entities from working with financial institutions that the state says do not support oil, gas, and guns. Senate Bills (SB) 13 and SB 19 prohibit financial managers from considering environmental, social and governance (ESG) policies when making investment decisions.
The Texas Comptroller under the legislation is required to develop and maintain a “blacklist” of financial institutions that boycott fossil fuel companies. Last August, the Comptroller’s Office released a list of companies and investment funds banned from doing business with the GOP-led state.
Similarly, Florida GOP Governor Ron DeSantis announced legislation in February designed to “protect Floridians from the wake-up call” of the ESG movement that his office said “continues to proliferate throughout the financial industry.” The legislation was enacted in May.
“Today’s announcement builds on my commitment to protecting consumers’ investments and their ability to access financial services in the Free State of Florida,” said DeSantis, who is running for president in 2024. , in February. “By enforcing arbitrary ESG financial measures that serve no one but the companies that created them, elites are bypassing the ballot box to implement a radical ideological agenda. Through this legislation, we will protect Floridians’ investments and the ability of Floridians to participate in the economy.
Florida law prohibits large banks, trusts, and other financial institutions from discriminating against customers’ social beliefs, including “their support for securing the border, owning a gun, and increasing our energy independence. It also prohibits the use of ESG in all investment decisions and when issuing bonds.
Newsweek emailed the media offices of Capital One and KeyBank for comment.