The Daily Caller – by Chuck Ross
A Massachusetts gun store owner says it’s “too late” for a bank to mend a relationship that it broke.
Mark Cohen, who owns Powderhorn Outfitters, a Hyannis, Mass. gun retailer, said that his longtime bank, TD Bank, refused to extend a line of credit because of the business he is in.
Cohen explained what happened in an interview with The Daily Caller on Friday.
“This year I went to apply for a line of credit, and the bank manager came by the store,” said Cohen, adding that he’s known the bank manager for over 20 years.
“Mark, I apologize,” she said, according to Cohen, “your credit history is great, but the bank is turning you down because you sell guns.”
Cohen told his friend and lender that he would have no choice but to close his accounts with the bank since they couldn’t provide the services his company needs.
He then sent an email blast to his 5,000-plus email list and wrote a blog post for the website Northeast Shooters. The Washington Times first reported the story.
Cohen believes that TD Bank didn’t want to do business with his gun store because of a government initiative called Operation Choke Point.
Operated under a cloud of secrecy by the Department of Justice and in coordination with the Federal Deposit Insurance Corporation, Operation Choke Point forces banks to keep a closer eye on companies in industries that are deemed “high risk”, including gun and ammunition dealers, coin dealers, payday lenders, and debt consolidation service providers.
The goal of the initiative is to protect consumers against fraud, but it has had negative consequences.
But lawmakers have paid increased attention to the initiative because they believe it ends up ensnaring legitimate businesses by “choking off” their access to banking services – the lifeblood of any business.
On Friday, Missouri Republican U.S. Rep. Blaine Luetkemeyer added an amendment to an appropriations bill seeking to cut off funding for Operation Choke Point. And on Thursday, the House Committee on Oversight and Government Reform issued a staff report called the operation “the Justice Department’s newest abuse of power.”
Reached for comment on Cohen and Powderhorn Outfitters’ situation, TD Bank provided a statement to The Daily Caller.
“At TD Bank, lending decisions are made at the local level. We are a bank of local lenders making local loans,” wrote TD Bank spokeswoman Erin Potts on Thursday.
After further inquiries into how lending decisions are made at the company, Potts issued another statement on Friday.
“At TD, Mr. Cohan’s [sic] business is not prohibited. We review each loan on a case by case basis. We apologize to Mr. Cohan [sic] for any inconvenience, and we have reached out to him to find a solution.”
Reaching out to find a solution entailed calling Cohen late Friday.
But the gun store owner said he is not interested in resuming the relationship.
“They basically offered nothing,” he said, in a phone interview with TheDC on Saturday.
“They want to kiss and make up, but it’s too little, too late,” Cohen said.
Cohen said that he’s received a massive response from customers and gun enthusiasts from across the country.
“It’s just grown legs,” he said, indicating that the bank’s decision to cut off ties to his company might backfire.
“My customers are coming in, and I’m getting emails, they’ve lost hundreds of customers in the last two days,” said Cohen, who speculated that the number of lost customers might reach into the thousands before all is said and done.
After he was dropped by TD Bank, Cohen said he researched and found out about Operation Choke Point, realizing that the initiative was likely what forced TD Bank to drop him.
“It’s frightening the way the government can come in and say you don’t have a right to exist and shut off your funding,” he said.
“It’s arbitrary and capricious.”
Cohen told TheDC that he plans to speak to an attorney about the issue.