Legislation offered to halt Wal-Mart bank plans
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Updated: April 17, 2007
The Federal Deposit Insurance Corp. would not be allowed to grant a charter to a company that earns less than 85-percent of income from financial service work. The legislation was introduced by Rep. Barney Frank, D-MA, and Rep. Paul Gilmore, R-OH.
In testimony today before a subcommittee of the House Financial Services Committee, a Federal Reserve witness supported the legislation saying Wal-Mart`s notion undermine financial oversight. Scott Alvarez of the Fed testified that such banks are a threat to the separation of banking and commerce operations.
Wal-Mart applied to open a Salt Lake City-based industrial loan company to handle electronic payment processing.
Critics of Wal-Mart`s have said the company could use the bank to offer other financial services.
(Copyright 2006 Newsroom Solutions, LLC)
