"U.S. probing 15 banks, payment processors for fraud"

[applegrove]

U.S. probing 15 banks, payment processors for fraud

By Aruna Viswanatha and Emily Stephenson at Reuters

http://www.reuters.com/article/2014/05/29/us-usa-banks-fraud-idUSKBN0E91W220140529?feedType=RSS&feedName=topNews

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Maame Ewusi-Mensah Frimpong, an official in the DOJ's civil division, wrote in the memo that the probe had already caused some banks to stop processing payments for entities the firms believed could be involved in fraud against consumers.

"We believe we already have denied fraudulent merchants access to tens, if not hundreds, of millions of dollars from consumers' bank accounts, and that amount will increase daily and indefinitely," Frimpong said in the November memo.

House Republicans, including oversight panel leader Darrell Issa, see the investigation differently. They say the DOJ has conducted a shadowy effort to put firms with legal activities out of business by pressuring banks to stop working with them.

"Operation Choke Point is the Justice Department's newest abuse of power," Issa said in a statement released with the documents. "If the administration believes some businesses should be out of business, they should prosecute them before a judge and jury."



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