Citigroup Takes a Step Back from Supporting Privatized Firearm Regulation
In a significant shift, Citigroup has announced that it will no longer discriminate against businesses in the firearms industry, marking a change in stance that has been in place for several decades.
The decision comes after the firearms industry faced financial impacts from discriminatory practices by corporate banks, with Texas barring Citigroup from underwriting billions in state bonds in 2021 due to such practices. The firearms industry, heavily regulated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and many state agencies, is arguably the most-regulated sector in America.
Citigroup's U.S. Commercial Firearms Policy, implemented in 2018, pertained to the sale of firearms by retail clients and partners. However, the policy change does not address the manufacturing of firearms.
The Obama-Biden administration initiated an effort to exclude the firearms industry from the financial-services industry, but it appears Citigroup has now taken a different approach. The bank's policy reversal is partly attributed to the election of President Donald Trump, who is pro-Second Amendment.
The press release from Citigroup does not constitute an apology for its past discriminatory practices. Instead, it emphasizes so-called gun violence rather than all violent crime, a tactic often used by anti-gun organizations and politicians. The release also seems to lean toward the need for more gun control by expressing hope that communities and lawmakers will continue to seek out ways to prevent the tragic consequences of gun violence.
Since then, 11 states have passed Firearm Industry Nondiscrimination (FIND) Act legislation, which aims to prevent state and local governments from working with financial companies that bar the firearms industry from banking and other services. The FIND Act legislation has also been introduced in the U.S. Congress.
It is not yet clear if Citigroup will allow the firearm industry to access its financial services fully. However, since 2021, the Firearm Industry Nondiscrimination Act or similar laws protecting state and local governments from collaborating with financial companies that exclude the firearms industry have been enacted primarily at the state level by several U.S. states, including Texas, Florida, and Arizona.
The change of heart from Citigroup is a significant step towards ending the long-standing discriminatory practices against the firearms industry. As the industry continues to navigate the complex regulatory landscape, it remains to be seen how this development will impact its future.
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