(UnitedHeadlines.com) -The U.S. Treasury Department criticized a Florida law that aims to prevent banks from considering non-financial factors when doing business with customers.
Signed by Florida Gov. Ron DeSantis in May, the law attempts to prevent banks from considering environmental, social, and governance (ESG) factors when customers are investing, stating the initiative could lead to discrimination based on political beliefs and cause harm to legitimate businesses. DeSantis argued that the law would help protect access to the financial sector for the firearms industry and conservative groups whose accounts have been frozen or closed. He gave the example of the Moms for Liberty advocacy group, whose PayPal account was frozen in 2022 for a short time. The law also allows customers who believe they were discriminated against by financial institutions a chance to appeal the decision.
The letter, sent from Treasury Department’s Under Secretary for Terrorism and Financial Intelligence Brian Nelson, claims that banks cannot discriminate against customers based on their business or affiliations. However, according to the letter from Nelson, laws like the one signed by DeSantis could “create uncertainty and may inhibit” national security efforts. Nelson also stated that such laws could lead to the U.S. financial system being used to launder money or evade sanctions.
The letter was sent to Democratic California Rep. Brad Sherman, Missouri Rep. Blaine Luetkemeyer, and New Jersey Rep. Josh Gottheimer in response to a July 8 request from the lawmakers.
Gottheimer urged states “considering similar laws” to think about “putting America’s national security at risk.”
A spokeswoman for DeSantis responded to the letter, questioning how the legislation “is a ‘national security threat,’ but the current U.S. Secret Service leadership is not?”
Although only Florida was mentioned in the letter, it is not the only state with such a law. A similar law was signed by the governor in Tennessee, while state legislatures in Georgia, Kentucky, Idaho, Arizona, Indiana, Louisiana, Iowa, and South Dakota have similar bills proposed.
Copyright 2024, UnitedHeadlines.com
