ISAAC DELIVERS KEYNOTE ADDRESS AT ANNUAL MEETING OF SHAREHOLDERS OF FEDERAL HOME LOAN BANK OF INDIANAPOLIS (August 27, 2014)
Posted: Aug 26, 2014
SOUND FINANCIAL REGULATION
ESSENTIAL TO SUSTAINABLE ECONOMIC GROWTH:
WE CAN ALL DO BETTER
By William M. Isaac*
I’m honored to be asked to address this annual meeting of the stakeholders of the Federal Home Loan Bank of Indianapolis. I know you represent a broad array of financial institutions supporting housing needs and economic growth in the U.S. I will focus my remarks to on the relationship between sound financial regulation and sustainable economic growth. I might add that it has taken me 45 years to write this speech.
DOJ Memo Leaves No Doubt About Choke Point’s Motives, by William M. Isaac published by American Banker on July 18, 2014
Posted: Jul 18, 2014
Two House Committees – Financial Services and Judiciary – held hearings this week on the legislation intended to rein in Operation Choke Point. Implemented nearly two years ago by the Department of Justice in coordination with some bank regulators, Operation Choke Point denies essential banking services to companies engaged in lawful business activities that some government officials don’t like. I testified in favor of the bill, H.R. 4986, sponsored by Missouri Republican Blaine Luetkemeyer, at both hearings.
Operation Choke Point is a particularly egregious example of an unconstitutional abuse of power that ought to alarm and frighten each of us, irrespective of our ideology, party affiliation, or view of the particular products or services being cut off.
Here is the link to the full article
ISAAC TESTIFIES BEFORE HOUSE JUDICIARY COMMITTEE ON OPERATION CHOKE POINT
Posted: Jul 17, 2014
[I was invited to testify on July 17, 2014 before a subcommittee of the House Judiciary Committee investigating Operation Choke Point, a highly controversial, not to mention un-Constitutional, program implemented about two years ago by the Department of Justice in collaboration with various other agencies. The program is designed to deprive essential banking services to lawful businesses that unelected government officials consider “undesirable” or “high risk.” My schedule did not allow me to testify in person at the hearing so I submitted the following statement for the record]:
Subcommittee on Regulatory Reform, Commercial and Antitrust Law,
Oversight Hearing on:
“Guilty until Proven Innocent? A Study of the Propriety & Legal Authority for the Justice Department’s Operation Choke Point”
July 17, 2014 at 9:30 a.m.
Subcommittee Chairman: The Honorable Spencer Bachus
Ranking Member: The Honorable Hank Johnson
TESTIMONY of WILLIAM M. ISAAC before the SUBCOMMITTEE ON FINANCIAL INSTITUTIONS AND CONSUMER CREDIT, July 15, 2014
Posted: Jul 16, 2014
WILLIAM M. ISAAC
SENIOR MANAGING DIRECTOR,
FTI CONSULTING, INC
FEDERAL DEPOSIT INSURANCE CORPORATION
SUBCOMMITTEE ON FINANCIAL INSTITUTIONS
AND CONSUMER CREDIT
U.S. HOUSE OF REPRESENTATIVES
COMMITTEE ON FINANCIAL SERVICES
July 15, 2014
Chairman Caputo, Ranking Member Meeks, and members of the Subcommittee, I am profoundly grateful that you are holding this hearing on “Operation Choke Point.” The opinions I express today are my own, and I do not purport to speak on behalf of my firm, FTI Consulting, Inc. In the interest of full disclosure, some of FTI’s clients have an interest in the matters before the Subcommittee today.
Congress needs to choke off Operation Choke Point, By William M. Isaac Published by The Hill newspaper, July 14, 2014
Posted: Jul 16, 2014
From small businesses on Main Street to the halls of Congress and the state legislatures, concern is mounting over Operation Choke Point, a coordinated effort among the Department of Justice (DOJ) and bank regulators to cut off banking services for a variety of legal, state-regulated businesses. This week alone, there are three congressional hearings on Operation Choke Point, hearings which will hopefully bring an end this misguided operation.
Operation Choke Point is one of the most dangerous programs I have experienced in my 45 years of service as a bank regulator, bank attorney and consultant, and bank board member. Operating without legal authority and guided by a political agenda, unelected officials at the DOJ are discouraging banks from providing basic banking services — deposit accounts, payments processing services, and payroll accounts – to lawful businesses simply because they don’t like them. Bankers are being cowed into submission by an oppressive regulatory regime.
Playing Semantic Games With Fannie and Freddie Investors By William M. Isaac Published by Wall Street Journal, July 7, 2014
Posted: Jul 8, 2014
For the past two years, the federal government has violated both the letter and the spirit of the law by illegally seizing the profits of Fannie Mae FNMA +0.50% and Freddie Mac.FMCC +0.51% Filings by the Obama administration in court and troubling public statements by its senior officials demonstrate a profound lack of adherence to the government’s duty as conservator of these government-supported mortgage institutions and to the rule of law.
In mid-May, Mel Watt, the head of the Federal Housing Finance Agency, signaled his personal apathy toward Fannie’s and Freddie’s private owners, saying in an interview for C-Span, “I don’t lay awake at night worrying about what’s fair to the shareholders.” If the government continues to denigrate and devalue shareholders, the economic consequences will be severe.
ISAAC DELIVERS KEYNOTE ADDRESS AT UNIVERSITY OF CHICAGO CONFERENCE ON CONTINENTAL ILLINOIS AND TOO BIG TO FAIL
Posted: May 16, 2014
The Booth School of Business of the University of Chicago held a conference on May 14-15, 2014 to discuss and debate, thirty years after the failure of Continental Illinois Bank, whether we have solved the problem of too big to fail financial firms in the U.S. It was my honor to deliver the keynote address to the assembly, which I hope you will enjoy and find useful:
It’s a privilege for me to appear before this esteemed group assembled by the University of Chicago’s Booth School of Business and to deliver the keynote address. The conference poses the following question: “Thirty years after the failure of Continental Illinois Bank: Have we solved too big to fail?”
The wording of the question suggests that Continental Illinois did in fact fail before it goes on to ask if we have solved the problem of too big to fail. I understand the apparent confusion because we structured the resolution of Continental Illinois so that it would mirror as much as possible the consequences of a failure without creating uncontrollable shock waves that could threaten the global financial system.
WILLIAM ISAAC ADDRESSES ATTORNEYS GENERAL SYMPOSIUM HOSTED BY GEORGE MASON UNIVERSITY SCHOOL OF LAW
Posted: Apr 30, 2014
It’s a privilege for me to appear before this esteemed group of legal and political leaders assembled by George Mason University School of Law. I graduated from the College of Law at The Ohio State University and my first position after graduating was at the Foley & Lardner law firm in Milwaukee. I next became general counsel of the largest bank in Kentucky before being appointed to the FDIC board by President Carter at the age of 34 and being named Chairman of the FDIC by President Reagan two years later. After serving eight years at the FDIC, I became a senior partner at Arnold & Porter law firm in Washington and founded my consulting firm, The Secura Group, now part of FTI Consulting. I have also served as Chairman of Fifth Third Bancorp.
In short, my career has been focused on law, banking, and public policy. Those topics will be woven through my talk today as I address whether we are on the right track or wrong track in our international approach toward bank regulation and supervision.
The period from 1978 to 1992 was exceptionally tumultuous for the U.S. economy and financial system. The 1970s was a period of low economic growth and high inflation – “stagflation” was the term coined to describe it.
‘Operation Choke Point’: Way Out of Control, by William M. Isaac published by American Banker on April 27, 2014
Posted: Apr 27, 2014
The Justice Department’s “Operation Choke Point” is said to be targeted at online payday lenders that lend into states that prohibit payday lending. But the operation is being pushed far beyond its stated objective of targeting online payday lenders violating state laws and is having potentially devastating impact on lawful check cashing and small loan businesses. This in turn will cut off tens of millions of people from much needed access to money to meet emergency needs.
Here is the link to the full article
DOJ’s ‘Operation Choke Point’: An Attack on Market Economy, by William M. Isaac published by American Banker on March 21, 2014
Posted: Mar 22, 2014
History teaches that when government bureaucracies try to direct economies, stifled creativity, distorted markets and low economic growth are inevitable results. One of the easiest and most insidious ways for bureaucrats to control the U.S. economy is through the banks, directing who gets – and who can’t get – loans and other essential banking services. That’s happening today, and it ought to alarm and frighten all of us.
Here is the link to the full article