Ron DeSantis’ crackdown on “woke” banks could help a big Ron DeSantis donor
Welcome to a special bonus edition of Popular Information. Today’s newsletter is written by an independent journalist with a special expertise into Florida politics. It pulls back the curtain on what’s really motivating DeSantis’ attack on “woke” banks. If you’d like to see Popular Information lift up more reporting like this, you can support our efforts by upgrading to a paid subscription. Today’s bonus newsletter is written by Jason Garcia, an amazing corporate-accountability reporter who focuses on Florida. He also has his own newsletter, Seeking Rents. For more of Jason’s indispensable reporting, subscribe. Flogged on by Florida Gov. Ron DeSantis, state lawmakers in Tallahassee are plowing ahead with a bill this session that is meant to stop banks and investment managers from thinking about things like carbon emissions, worker pay and executive diversity when deciding where to invest money. Much of the debate on House Bill 3, which comes directly from DeSantis and is being fast-tracked through the Florida House of Representatives, has centered around provisions that would ensure public pension plans and other state-controlled funds cannot consider “environmental, social and governance” standards — ESG — when investing. But the proposal goes far beyond public investing. The legislation also attempts to exert state control over private banking, too — by threatening banks with financial and legal retaliation if they refuse to lend to a company based on its “business sector.” And that could help one of the biggest and most politically influential companies in Florida: The GEO Group Inc., the Boca Raton-based operator of for-profit prisons and immigration-detention centers. DeSantis’ crusade against “woke” banking comes after more than half a dozen of the country’s biggest banks stopped financing GEO and fellow prison operator CoreCivic Inc., amid pressure from criminal-justice reform activists and advocates for migrants seeking asylum in the United States. Though the big banks pulled out of the industry in mid-2019, the aftershocks continue today: GEO stopped paying dividends to investors last year and is still paying down its debt load. Records show GEO is registered to lobby on HB 3, although it’s not clear how much input the company has had on the legislation. Representatives for GEO did not respond to requests for comment. But DeSantis has repeatedly cited GEO’s plight while calling on the Legislature to take action. “All these Wall Street banks cut off the credit to The GEO Group because there were activists who want to abolish police, abolish ICE [U.S. Immigration & Customs Enforcement], that were giving them a lot of blowback for providing that financing,” DeSantis said at press conference in July, standing in front of a banner that read “Government of Laws Not Woke CEOS.” “A few years ago, GEO Group was de-banked by the major financial institutions in this country,” DeSantis added at another press conference in February, this time speaking from a podium emblazoned with, “Government of Laws Not Woke Politics”. “This was a company that was doing things — contracting with the actual federal government — and you had the banks cut them off and they have to try and find funding elsewhere.” One of DeSantis’ earliest backersDeSantis, who is widely expected to run for president, has a lengthy history with GEO and its executives. GEO was one of the earliest big-dollar donors to DeSantis’ 2018 campaign for governor — back when DeSantis was still seen as an underdog, before former President Donald Trump lifted him to the Republican nomination. Altogether, campaign-finance records show that GEO and its executives donated more than $200,000 to DeSantis during that first campaign. They have also given $1.5 million to the Republican Party of Florida during DeSantis’ tenure as governor. Emails obtained through public-records requests show that DeSantis’ staff included GEO’s executive chairman on an exclusive list of donors, lobbyists and other supporters to be invited to the governor’s 2020 “State of the State” speech. GEO’s top attorney — a former Senate President who took a job with GEO immediately after leaving the Legislature — was among the VIPs spotted at DeSantis’ second inauguration in January. The DeSantis administration last year renewed a major contract with GEO. The company made more than $110 million from Florida contracts in 2021, according to investor filings. Pressuring banks into providing loansSo how would House Bill 3 pressure private banks — and how might it help The GEO Group? It starts with the fact that Florida has a lot of cash. So do its cities, counties, school districts and sheriff’s offices — along with public agencies ranging from airports to universities. Those governments have to put their money in banks. And their “public deposits” are a big line of business: Banks are currently holding nearly $40 billion in public deposits from Florida governments, according to data from the state’s Bureau of Collateral Management. Banks fight hard to hang on to these accounts; the industry is currently lobbying against legislation that would let credit unions in on the public deposits business, too. A bank that wants to hold a public deposit in Florida must first get qualified by the state’s chief financial officer. The current requirements are relatively basic — the bank must be federally insured, for instance, and it must have a branch in Florida. There are 118 banks on the qualified list right now. But HB 3 would throw up a thicket of new lending “discrimination” rules for any bank that wants to continue holding public deposits. For example, a bank would be disqualified from holding public deposits if it canceled or denied service to a customer based on the customer’s “business sector.” What’s more, a bank would also be disqualified if it refuses to finance a customer based on the customer’s “support of the state or Federal Government in combatting illegal immigration.” That provision, in particular, appears tailored to protect GEO, whose biggest customer is U.S. Immigration and Customers Enforcement. Contracts with ICE generated more than $1 billion of GEO’s $2.4 billion revenue last year, according to regulatory filings. Billions of dollars at stakeTake Wells Fargo. It was one of the first big banks to cut ties with GEO in 2019. Wells Fargo holds more public deposits than any other bank in Florida. It’s currently holding more than $7 billion, according to the Bureau of Collateral Management data. Bank of America, which also dropped GEO, is holding another $2.5 billion in public deposits. But the threat to banks goes beyond the potential loss of business. That’s because the legislation would also require any bank that wants to hold public deposits to certify — under oath — that it is not violating any of the new lending rules. It would also give Florida’s chief financial officer the power to demand internal bank records to make sure they are in compliance. And it would give the state’s attorney general the power to file lawsuits against non-compliant banks. Florida’s current chief financial officer is Jimmy Patronis, a Republican who has taken $51,000 from GEO since 2018. The state’s current attorney general is Ashley Moody, a Republican who has taken $69,000 from GEO over the same period. A sledgehammer over small banksFederal law limits just how far the state of Florida can go when it comes to regulating or punishing big national banks or banks chartered in other states. But there are no such limits on what the state can do to the 69 banks and 66 credit unions that chartered under Florida law. And HB 3 would swing an even bigger sledgehammer at these smaller institutions. Under the legislation, the state could revoke the license of any state-chartered bank or credit union that violates the new lending rules — like refusing to provide financing to a company based on its business sector or because of the company’s involvement with immigration enforcement. It would even expose the bank or credit union to potential fraud litigation brought by the attorney general or any local state attorney in Florida. A banking Pandora’s boxThe banking industry has put up some meek opposition to the legislation so far — though lobbyists are clearly wary of antagonizing DeSantis, who has made fighting all things “woke” a core part of his political identity. During an appearance before the House Commerce Committee last week, Anthony DiMarco, a lobbyist for the Florida Bankers Association, jokingly referred to himself as “the sacrificial lamb” for the industry. But DiMarco also warned lawmakers that HB 3 would create a compliance nightmare for banks, especially small community banks. And he pointed out that banks often have non-ideological reasons for choosing to serve some industries but not others — sometimes it’s as simple as carving out a specialized niche. The lobbyist also warned Republicans that they may be opening something of a banking Pandora’s Box. “Our position is, we should, basically, be able to bank who we think we should be able to bank — and not be told who to bank and not told who not to bank,” DiMarco said. “Because there’s a little different take going on in Washington, D.C., than there is in Tallahassee. And you’ll see that in other states. Some blue states are pushing back on some of this.” The warnings have fallen on deaf areas, at least so far. Though the Florida Legislature is only two weeks into its annual two-month session, House Bill 3 is already teed up for a vote in the full House of Representatives. |
Older messages
Who gets bailed out? Who gets left out?
Thursday, March 16, 2023
Last Friday, Silicon Valley Bank (SVB) — which held deposits for thousands of tech startups — collapsed. The failure was sparked by SVB executives mismanaging the bank's assets and fueled by
Silicon Valley Bank donated zero dollars to Black Lives Matter
Thursday, March 16, 2023
Tuesday night on Fox News, host Jesse Watters asserted that Silicon Valley Bank (SVB) "donated $74 million to Black Lives Matter." That was why, Watters claimed, federal regulators did not
Deregulating child labor
Tuesday, March 14, 2023
In February, a federal investigation found that Packers Sanitation Services illegally employed at least 102 children “in hazardous occupations” across 13 meat processing facilities in eight states. The
Florida book bans are not a hoax
Monday, March 13, 2023
For months, Popular Information has documented how thousands of books have been removed from the shelves of Florida school libraries or have otherwise been made unavailable to Florida students. These
Why Musk attacked me
Friday, March 10, 2023
Popular Information has documented how, under Elon Musk's leadership, Twitter's Community Notes feature has been weaponized against our reporting. Purportedly, Community Notes are used to
You Might Also Like
Storm Fall
Monday, January 13, 2025
A Storm Trapped A Luxury Passenger Train // The Rise And Fall Of "Fact-Checking" Storm Fall By Caroline Crampton • 13 Jan 2025 View in browser View in browser A Storm Trapped A Luxury
⚡️ The ‘DOOM’ Technological Arms Race
Monday, January 13, 2025
Plus: 'Ahsoka' Season 2 just recast a crucial character. Inverse Daily Hackers will not rest until a classic shooter is playable on absolutely everything, including satellites and pregnancy
☕ The ways of Waymo
Monday, January 13, 2025
Waymo's co-CEO at CES 2025. January 13, 2025 View Online | Sign Up Tech Brew presented by Hyilo It's Monday. Today we've got the final real-time dispatch from CES 2025, a keynote from Waymo
The Architects Of L.A.’s Wildfire Devastation
Monday, January 13, 2025
Developers and real estate interests crushed efforts to limit development in high-wildfire-risk areas — including in LA neighborhoods now in ashes. Again and again, developers and real estate interests
Is a popular new solution to methane gas just a lot of hot air?
Monday, January 13, 2025
Plus: Donald Trump's feud with a fish, a new hottest year on record, and more. January 13, 2025 View in browser Kenny Torrella is a senior reporter for Vox's Future Perfect section, with a
The corporate lobbyist who will run the Trump White House
Monday, January 13, 2025
During the 2024 campaign, Trump condemned the power of lobbyists in Washington, DC, and pledged that, if he returned to the White House, they would have no influence. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Trump Prosecutor Resigns, Bitcoins Left in Dump, and Smelly Video Games
Monday, January 13, 2025
Special counsel Jack Smith resigned from the Justice Department on Friday after submitting a final report on President-elect Donald Trump to Attorney Gen. Merrick Garland. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Numlock News: January 13, 2025 • Violins, Romantasy, Thieves
Monday, January 13, 2025
By Walt Hickey ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
☕ Crime-fighting vacuum
Monday, January 13, 2025
Meta's community notes may impact ad revenue... January 13, 2025 View Online | Sign Up | Shop Morning Brew Presented By Bland.AI Good morning. The world's largest gathering of humanity is
Technical snag forces another delay for the first orbital launch of Blue Origin’s New Glenn rocket
Monday, January 13, 2025
Breaking News from GeekWire GeekWire.com | View in browser Jeff Bezos' Blue Origin space venture counted down to the final hour tonight, but in the end, the company had to postpone the first-ever