More Shocking Audio Tapes Reveal Obama Program Targeting Legal Businesses

posted March 3, 2015

Operation Choke Point Sets Sights on the Tobacco Industry

March 3, 2015 – Washington, D.C. – With the Obama Administration attempting to back-peddle on its controversial Operation Choke Point program, new audio tapes acquired by the US Consumer Coalition demonstrate just how aggressive the federal government has become in attempting to cut off legal businesses from the financial industry. The new tapes demonstrate a coordinated effort to close the accounts of Global Hookah Distributors (GHD), a tobacco and tobacco products distributor based in Charlotte, North Carolina.

Last year, Bank of America (BofA) abruptly shut down GHD’s numerous bank accounts after serving their business for 12 years. Initially, BofA offered no explanation as to why the accounts were closed. In early February, GHD’s payment processor, EFT Network, also shut down their account due to regulatory pressure from Operation Choke Point.

“We were shocked that the government would cut us off from both our bank and our payment processor. We run a legal business and comply with all the applicable regulations,” said Brennan Appel, president of Global Hookah Distributors. “This interference with our ability to run our businesses is beyond anything we’ve ever seen or thought legally possible.”

In a taped call with Mr. Appel, EFT Network president Alex Bacon explicitly blames Operation Choke Point for the account closures and lists a number of lawful industries considered “high-risk” by federal regulators, including tobacco. For the first time, the Consumer Financial Protection Bureau is also mentioned as a key player in advancing this effort, led originally by the FDIC and Justice Department.

“They’re going after clinics, collection agencies, gun dealers, ammunition dealers, payment processors,” said Mr. Bacon during the candid conversation. “[Examiners say] We’re going to make your life miserable. Instead of auditing you once a year we’re going to audit you four times a year. If we find anything negative we’re going to write it up and then you’re going to incur increased cost, increased focus from banking regulators.”

Listen to the audio clips and read more about Operation Choke Point’s latest victim by clicking HERE.

GHD submitted their story through the USCC Whistleblower response website. Over the last year, GHD has been the victim of Operation Choke Point and has lost several accounts with Bank of America at the hand of US banking regulators. In February 2015, GHD’s payment processor was also pressured to terminate GHD’s account. The release of these new recordings comes less than a month after others received national media attention confirming federal regulators instructed a gun shop owner’s bank to close his accounts. Bank executives confirmed on tape that they closed Hawkins Guns accounts after being pressured by federal agents.

“What happened to GHD is happening to companies all across America,” said Brian Wise, Senior Advisor to the US Consumer Coalition. “Operation Choke Point remains the greatest threat to consumer choice and freedom this country has ever seen. Congress needs to act now to defend lawful businesses like GHD and stop this overreach at the expense of our economy, America’s businesses and our freedom.”


Rob Damschen
(202) 617-6155