The Federal Reserve Board and the Office of the Comptroller of the Currency are the latest agencies to draw fire from U.S. lawmakers for scrutinizing banks' relationships with online lenders.

In a letter Thursday to Fed Chair Janet Yellen and Comptroller Thomas Curry, 12 House Republicans and 11 of their Democratic colleagues expressed "grave concern" that recent efforts to crack down on fraud are harming fully licensed and regulated businesses.

"Banks should not be forced to throw out legitimate customers they have successfully banked for decades," the letter states. "Regulators should instead directly target predatory actors who are breaking existing laws and resist any broad approach that causes undue consequences on an entire industry."

The letter reflects widening concern in Congress about stepped-up scrutiny by both banking regulators and the Justice Department, which is conducting a related probe known as Operation Choke Point. Last August, 31 Republican lawmakers sent a similar letter to the Federal Deposit Insurance Corp. and the DOJ, but no Democrats joined them.

The bipartisan letter mirrors arguments being made behind-the-scenes by trade groups representing banks and payment processing firms, which frequently serve as intermediaries between online lenders and the banking system. In recent weeks, the Justice Department has started a dialogue about Operation Choke Point with the American Bankers Association and the Electronic Transactions Association.

Last Friday, the DOJ hosted a meeting to hear the concerns that banks and payment processors have about its investigation. Among those in attendance were Assistant Attorney General Stuart Delery, ABA President Frank Keating and ETA President Jason Oxman.

"It was the first meeting, and I'm hopeful that the ABA will be able to continue to have dialogue that'll be constructive," said Richard Riese, a senior vice president at the ABA, who also attended the meeting.

"I think that was a good first step, that they wanted to hear from the industry," said Oxman, whose group represents payment processing firms. "We made the case that we are in a better position to assist DOJ in its laudable goal of stamping out fraud by being a partner rather than by being a target of the investigation."

A DOJ spokeswoman said in an email, "The department is committed to pursuing any evidence of financial fraud, particularly fraud that harms consumers and threatens the integrity of the financial system." She declined to characterize last week's meeting.

Under Operation Choke Point, the Justice Department has sent subpoenas to more than 50 banks and payment processing firms. The only lawsuit filed so far resulted in a tentative $1.2 million settlement with Four Oaks Bank in Four Oaks, N.C., but that agreement has yet to be approved by a judge.

The latest congressional letter — spearheaded by Rep. Blaine Luetkemeyer, R-Mo. — states that efforts to stamp out fraud are praiseworthy, but that legitimate, licensed businesses are also being hurt by the government's actions.

"Banks that have terminated these services," the letter states, "are reflecting blanket concerns about heightened regulatory scrutiny as opposed to engaging in appropriate, risk-based determinations based on individual customer circumstances."

The letter does not cite any specific licensed companies that have been harmed, but it claims that examiners from the Fed and OCC are playing a role in discouraging banks from processing lawful transactions.

A Fed spokeswoman said that the agency has received the letter and plans to respond. An OCC spokesman declined to comment.

Signing the letter were GOP Reps. Luetkemeyer, Kevin Yoder, Pete Sessions, Lynn Westmoreland, Patrick McHenry, Dennis Ross, Steve Stivers, Mick Mulvaney, Sean Duffy, Robert Hurt, Lynn Jenkins and Stephen Fincher.

Joining them were Democratic Reps. Alcee Hastings, Joe Garcia, Bennie Thompson, Gregory Meeks, Tony Cardenas, Patrick Murphy, William Lacy Clay, Filemon Vela, Henry Cuellar, Ed Perlmutter, and Frederica Wilson.

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