BAC Bank of America Corporation

By Andrew Ackerman 

WASHINGTON -- The Senate's top overseer of banks is criticizing moves by Citigroup Inc. and Bank of America Corp. to stop doing some business with the gun industry following the deadly shooting in February at a Florida high school.

Senate Banking Committee Chairman Mike Crapo (R., Idaho), in letters to the heads of both banks made public Wednesday, said he was concerned when large national banks "cut off financial services for lawful businesses they may disfavor."

Mr. Crapo's letters, to Bank of America's Brian Moynihan and Citigroup's Michael Corbat, come after the firms took steps in recent weeks to curtail business with the gun industry. Mr. Moynihan's letter was dated Wednesday and Mr. Corbat's Friday.

Citi, the first of the two big banks to act, said last month that it would prohibit its business partners from selling firearms to customers under the age of 21 and those who haven't passed a background check. Bank of America later announced it would stop lending to manufacturers of military-inspired rifles like the one used in the shooting at Marjory Stoneman Douglas High School in Parkland, Fla., which left 17 dead.

It isn't clear what concrete steps lawmakers could take in reaction to the banks' moves, which have divided Republican lawmakers. Some, like Mr. Crapo, whose panel oversees both banks, argue the banks are attempting to replace legislators and shape social policy by limiting access to credit. Others prefer a more hands-off approach and say banks should be free to make their own business decisions.

A Citi spokesman confirmed the bank had received Mr. Crapo's letter and said the firm would respond. A spokesman for Bank of American declined to comment.

Last week, Republican lawmakers including Mr. Crapo pressed Federal Reserve Vice Chairman for Supervision Randal Quarles to address the banks' decisions. Mr. Quarles said it wasn't the Fed's place to take a position on guns.

In his letters to the bank chiefs, Mr. Crapo said he had "serious concerns" about the industry's potential use of personally identifiable information to "monitor and deny financial services to individuals and companies who are engaging in completely legal and, in this case, constitutionally-protected conduct."

He said his committee would focus in coming months on the collection and use of such personal data, and asked the banks to answer a series of questions, including how they plan to implement their new policies.

Citi's new firearms policy doesn't change how it handles customer data, a person familiar with its thinking said.

Write to Andrew Ackerman at andrew.ackerman@wsj.com

(END) Dow Jones Newswires

April 25, 2018 18:18 ET (22:18 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.