Discussions on Border Banking Challenges Continue to Push Ahead
NOGALES, Ariz. - The FPAA and the Greater Nogales Santa Cruz County Port Authority testified in front of the Arizona Senate Finance Committee in early February to discuss the difficulties that border businesses have in obtaining financing, holding business accounts, and other banking services. Senator John McCain also submitted a statement to the committee concerning the banking closures.
Subsequently, Senator Jeff Flake and Senator John McCain have been working with constituents along the border to address the concerns that residents have about the banking issues. In a letter to Senator Rickard Shelby, chairman of the United States Senate Committee on Banking, Housing, and Urban Affairs, both Senators urge the Federal committee to hold a hearing "that would examine access of communities and businesses to banking services in states bordering Mexico." The joint press release and letter from Senators Flake and McCain can be read on Senator McCain's website.
During the February 4 testimony in Phoenix, FPAA President Lance Jungmeyer gave an overview of the current situation, describing the unique financing needs of produce importers and how the Department of Justice crackdown on money laundering has forced many national banks to abandon their long-time, law abiding customers.
"This is the cause of a Federal decision, which led national banks to look at the border and decide the business wasn't worth the trouble, despite companies and individuals having accounts for many decades," Jungmeyer said.
FPAA Member Sabrina Hallman of Sierra Seed stated in her remarks to the committee, "As a US company, working in an international business arena, the lack of assistance and understanding from so many of our national banks is a slap in the face at best and a tragedy at worst. The lack of confidence, trust and foresight from our own government continue to cause turmoil for the border businesses and clearly works to stop any economic growth and development at our crucial International Ports of Entry."
She added, "At the same time, the opportunity for growth and economic development has never been greater than it is today at our southern Borders. Business need to be encouraged to grow and develop. This cannot happen with the current border banking situation."
Bruce Bracker, speaking on behalf of the Greater Nogales and Santa Cruz County Port Authority, explained, "Time and time again, companies that have had accounts for years, and most for decades, have simply been informed via a form letter that their bank accounts will be closed. They are being closed not for lack of payment, lack of use, or lack of profitability for the bank. They are closing because the banks have made the unilateral decision to not deal with the regulatory frameworks imposed on them that have set higher standards for monitoring and compliance. In other words, it is just too much of a hassle for them."
Jungmeyer, Hallman, Bracker and others continue to say that the current situation is untenable. Through the efforts of Arizona Senators John McCain and Jeff Flake, border businesses are hoping to find relief from this ever-challenging issue. In addition to the request for a Federal hearing, Senator McCain has reached out to large banking institutions to determine the root causes of closures along the border. Senator Flake is reaching out to banking regulators to discuss new federal measures that could be inadvertently harming U.S. businesses.
In the meantime, advocates like the FPAA and the Greater Nogales Santa Cruz County Port Authority continue to raise this issue and search for solutions.
The full hearing can be viewed online. http://azleg.granicus.com/MediaPlayer.php?view_id=22&clip_id=14925
Senator McCain's statement can be found on his website at: http://www.mccain.senate.gov/public/index.cfm/press-releases?ID=80be396d-0964-460d-a870-123ca0efe94b.
The joint press release and letter from Senators Flake and McCain can be read here: http://www.mccain.senate.gov/public/index.cfm/press-releases?ID=43dfe4ea-3331-4075-9b99-9693d529303d.
About the Fresh Produce Association of the Americas: The FPAA is a nonprofit trade association headquartered in Nogales, Arizona, that represents over 120 U.S. member companies involved in growing, packing, sales and transportation of fresh fruits and vegetables grown in Mexico. The FPAA leverages the efforts of private companies and partner-associations to increase the consumption of fresh fruits and vegetable from Mexico. The Mariposa Port of Entry located in Nogales, Arizona, is the largest port of entry for fresh produce imported into the U.S. from Mexico.