New York City officials have taken action against two major banks, Capital One and KeyBank, after the financial institutions failed to come up with plans to combat discrimination in their operations.
On Thursday, New York Comptroller Brad Lander restricted account deposits at the two banks because of their failure to comply with city mandates issued earlier this year. The mandates require publicly funded banks to provide detailed strategies to address various forms of discrimination in their operations.
Lander’s office announced that Capital One and KeyBank had flatly refused to comply with the anti-discrimination requirement. In a statement, Lander stressed that banks that want to do business with New York City must demonstrate responsible stewardship of public funds and act responsibly within communities. He expressed disappointment that the five banks, including International Finance Bank, PNC Bank and Wells Fargo, had failed to comply with the city’s anti-discrimination policies, even though the latter three banks currently have no city funds.
The recent measures will freeze new deposits at Capital One and KeyBank for up to two years. Capital One had $7.2 million in city funds, while KeyBank had $10 million.
Criticism has emerged over New York City’s push for banks to comply with the environmental, social and corporate governance (ESG) movement. Critics argue that ESG encourages companies to use their financial clout to promote specific left-wing social goals. Elon Musk, for example, has criticized the ESG, claiming that the “S” stands for “Satanic.” Meanwhile, stockbroker and financial commentator Peter Schiff argues that banks only discriminate based on competition and creditworthiness to maximize profits.
ESG-related concerns also extend to policies introduced by Democratic officials, which consider personal loans regardless of the borrower’s financial responsibility. The Federal Housing Finance Agency, led by Director Sandra Thompson under President Joe Biden’s administration, recently unveiled a policy that would result in higher mortgage rates and monthly payments for Americans with scores of strong credit, while those with lower credit scores and smaller down payments will receive. better rates Republican state finance officials wrote to Biden and Thompson, criticizing the move for making home purchases significantly more expensive for families with strong credit, contradicting the long-standing principle of rewarding responsible financial behavior.
In addition, Treasury Secretary Janet Yellen launched an Advisory Committee on Racial Equity with the goal of addressing racial disparities and advancing racial equity in the economy. The committee will focus on efforts to address the stark disparities facing communities of color.
The New York City Comptroller’s Office argued for restricting banks on ESG and “racial equity” grounds.
“Consumer banks play a vital role in New York City communities, and their practices in lending, employment and banking products and services resonate across the five boroughs,” said Controller Lander. “In the pursuit of a shared and prosperous economy for all, the city must be vigilant in evaluating the banks that hold their money and hearing from New Yorkers about their experiences with these institutions. I am grateful to Mayor Adams and Commissioner Niblack for their partnership in this work as we continue to look carefully at who the city is choosing as banking partners.”
New York City Mayor Eric Adams also approved the plan to regulate banks to implement the Democratic Party’s political agenda.
“Financial institutions are critical pillars of our communities, and we must demand the highest standards from any bank entrusted with public funds,” said Mayor Adams. “These new steps will ensure that the Banking Commission appoints only those banks that have demonstrated they can protect taxpayers’ money and are committed to promoting fairness in all aspects of their operations.”
Barika X. Williams, executive director of the Association for Neighborhood and Housing Development, endorsed the city’s Woke program.
“The ability to preserve and benefit from New Yorkers’ hard-earned city deposits is a privilege, not a right,” Williams said. “We applaud the Banking Commission for taking this step to accept public comment and call on the city to incorporate the results into its final determinations. We hope this is just a first step in deepening engagement, scrutiny and transparency of the community in this public process. The City must demand more from banks that seek the privilege of holding New York City deposits and should not do business with banks that ignore, disinvest in, exploit, or discriminate against the communities of color”.
Andy Morrison, associate director of the New Economy Project, accused the banks of “shortchanging” consumers.
“We are pleased that the New York City Banking Commission is seeking public input on how best to ensure that banks holding City deposits meet the highest standards,” Morrison said. “Where the city deposits its billions of dollars is a fundamental matter of public policy, and we must demand that our public money is not in the hands of banks that harm New Yorkers and the city’s neighborhoods.”
Thomas Sowell, an American economist, author and senior fellow at the Hoover Institution, has criticized the simplistic idea that banks are discriminating against customers based on race.
“In 2000, for example, data from the US Commission on Civil Rights showed that 44.6% of black applicants were turned down for such mortgages, while only 22.3% of white bidders were rejected,” Sowell noted in a 2010 article. . “These and similar statistics from other sources are triggering widespread complaints from mortgage lenders and demands that the government ‘do something’ to stop rampant racial discrimination at mortgage lending institutions.”
“The same US Civil Rights Commission report that showed blacks were turned down for conventional mortgages at twice the rate for whites contained other statistics showing that whites were turned down for those same mortgages at a rate nearly double that for whites.” Asian-Americans and Native Hawaiians.”
Thus, banks care about money more than the race of their customers. This is yet another excuse for the radical left to take over American institutions and enlist them in the service of their political agenda.
In May, Florida Governor Ron DeSantis signed a law prohibiting state officials from investing public money to promote ESG goals and banned the sale of ESG bonds.
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