Chase Bank Unveils New “Reputation Risk” Campaign, Targeting Loyal Customers For Their Political Beliefs

Chase Bank Unveils New “Reputation Risk” Campaign, Targeting Loyal Customers For Their Political Beliefs

Via Revolver:

Over the weekend a stunning image made the rounds online. The photo showed a letter from Chase Bank to Lori Flynn, the wife of Gen. Michael Flynn, informing her that her credit cards were being canceled due to the “reputational risk” she created for the company.

Some on the left initially suggested the letter might be a hoax, before concluding that Chase’s decision was legitimate and something to celebrate.

Mike Flynn’s employee and formerly part of “Q,” Tracy Diaz aka tracybeanz, screwed up and posted a letter from Chase canceling all of Flynn’s credit cards. 😬

They cited “reputational risk.”
Despite Mike Flynn’s efforts, it’s still a free country. 🇺🇸 pic.twitter.com/uIZisoMp61

— Jim Stewartson, Antifascist, #RIPQ 🇺🇸🏴‍☠️ (@jimstewartson) August 29, 2021

On Tuesday Chase confirmed that the cancellation was real and aimed at Flynn’s wife, Lori. The company then tried to walk back the cancellation, claiming that it was all “mistake.” If there was any “mistake” in targeting Flynn’s family, it was in misjudging the PR backlash that would ensue from such an egregious display of political persecution.

 

Chase’s “mistaken” letter to General Flynn’s wife wasn’t the first time an organization has used “reputational risk” as a pretext for political censorship.  In fact, weaponizing claims of “reputational risk” has become a favored tactic for the institutional left to deny its enemies the right to organize or even live normal day-to-day lives. 

Long before Gen. Flynn became a target, none other than disgraced New York Gov. Andrew Cuomo tried to use “reputational risk” as a means to topple the National Rifle Association.

The State of New York enjoys regulatory power over all banks and insurers chartered or registered in the state — a considerable power when one takes Wall Street into account. In the spring of 2018, Governor Cuomo invoked this regulatory authority in a thuggish attempt to make it impossible for the NRA to publicly campaign for gun rights.

It is typical for shared-interest groups, from the Habitat for Humanity to the New York Bar Association to the NRA, to partner with insurance companies to offer insurance policies to its members. The NRA insurance, known as Carry Guard, reimbursed policyholders for attorney fees and other legal expenses in the event that they used legally-owned guns in self-defense. The NRA’s program was entirely legal, and used routine insurance templates and market practices. However, Cuomo’s administration decided to target the Carry Guard program — and no other affinity-based insurance offerings —  for supposed insurance-regulatory infirmities.

The objective was simple: Cut off a stream of revenue for the NRA, and increase the risk of financial ruin for future George Zimmermans who legally used guns in self-defense.

Soon, Cuomo’s investigations turned into a broad-based offensive to deny the NRA access to basic services. Acting on Cuomo’s orders, New York’s bank regulatory authority sent a letter to all banks and insurers operating within the state with demands that can only be described as mafia-like in nature:

• The tragic devastation caused by gun violence that we have regrettably been increasingly witnessing is a public safety and health issue that should no longer be tolerated by the public and there will undoubtedly be increasing public backlash against the NRA and like organizations.Our insurers are key players in maintaining and improving public health and safety in the communities they serve. They are also in the business of managing risks, including their own reputational risks, by making risk management decisions on a regular basis regarding if and how they will do business with certain sectors or entities. In light of the above, and subject to compliance with applicable laws, the Department encourages its insurers to continue evaluating and managing their risks, including reputational risks, that may arise from their dealings with the NRAor similar gun promotion organizations, if any, as well as continued assessment of compliance with their own codes of social responsibility. The Department encourages regulated institutions to review any relationships they have with the NRA or similar gun promotion organizations, and to take prompt actions to managing these risks and promote public health and safety.

The whole episode reads like a scene out of The Godfather.

“The NRA is just bad and awful, the way they campaign against gun control. It’d be really terrible if any company suffered damage to their reputation by providing them banking or insurance services. New York would hate to see that happen.”

The thuggery of the letter is even more sinister because it doesn’t simply invent the concept of “reputational risk” from whole cloth. Reputational risk is a real thing that companies must account for. Traditionally, “reputational risk” for a company derives from that company’s own practices. A company that makes shoddy products, piles up safety violations, or mishandles its finances to the point of insolvency will suffer reputational damage. Such damage can destroy a company.

All of these traditional reputational concerns, though, are either about matters of the law or politically-neutral quality-of-service. Gov. Cuomo’s plot was to distend the concept of “reputational risk” to encompass pure political stigma. He used state regulators to bully institutions into “canceling” any customer who fell into disfavor with the ruling party.

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