By Josh Kosman
Bank of America CEO Brian Moynihan may be a marked man in the White House and not just because his bank would not take President Trump’s money, sources said.
Trump on August 7 signed an executive order mandating banking regulators to investigate whether banks have discriminated against conservatives and certain industries.
President Trump is targeting Brian Moynihan
The President said August 5 on CNBC’s Squawk Box that BofA and JPMorgan would not accept his deposits after his first term in office. But there may be more to the story.
Trump sung the same tune Jan. 23 with Moynihan right next to him on a World Economic Forum stage.
“I hope you start opening your bank to conservatives, because many conservatives complain that the banks are not allowing them to do business within the bank, and that included a place called Bank of America,” the President said. “I hope you’re going to open your banks to conservatives, because what you’re doing is wrong.”
He was likely referring to when BofA stopped banking private prison company GEO Group, BofA insiders said.
Photo by Ye Jinghan on Unsplash
“This is what Trump was pissed about,” a BofA source said. “Trump needs GEO.”
BofA in June 2019 was the last of the big banks to cut off future funding for private prison companies including GEO.
“They did not want to be the last bank standing,” a source with direct knowledge of the situation said.
GEO now processes more than one-third of the people ICE detains, 20,000 beds, at 21 facilities, according to GEO. The firm also owns prisons and jails.
But back in 2019 there was a big fight within the bank whether to stop doing more business with GEO after one of GEO’s other big lenders JPMorgan in March 2019 said it would no longer fund private prisons.
A GEO facility according to the company’s website
Wells Fargo was also pulling back.
BofA Vice Chair Anne Finucane argued for staying the course and was very vocal about it, a source said, causing some at the bank to panic, the source said.
There were meetings between top bank executives where what to do about lending to private prisons was fiercely debated.
Ultimately, BofA’s Global Head of ESG Andrew Plepler had the final word and BoA stopped future funding of private prisons, the BofA source said.
“The private sector is attempting to respond to public policy and government needs and demands in the absence of long standing and widely recognized reforms needed in criminal justice and immigration policies,” BofA said in a June 2019 statement to USA Today. “Lacking further legal and policy clarity, and in recognition of the concerns of our employees and stakeholders in the communities we serve, it is our intention to exit these relationships.”
Attorney General Pam Bondi used to work for lobbying firm Ballard Partners.
GEO Group Chair George Zoley on June 26, 2019 commented publicly on BofA’s decision to no longer extend financing to correctional and rehabilitation services providers.
He said he expected there would be no impact on its $900 million revolving line of credit that did not mature until May 17, 2024.
“For over thirty years, we have provided high-quality services to the federal government under both Democrat and Republican administrations. To be clear, The GEO Group has never managed any facilities that house unaccompanied minors, nor have we ever managed border patrol holding facilities,” Zoley said at the time.
GEO in 2020 sold shares of its common stock to raise money.
ICE arrests a man from Guatemala, according to ICE website
President Biden on January 26, 2021 issued an executive order to not renew contracts with for-profit prisons though it made an exception for immigration detention facilities.
GEO Group’s shares fell to below $6 a share. Under President Trump, with the ban lifted, the price roared to over $36 though it has now fallen to just over $21.
Bank of America in Dec. 2023 changed its outright ban on banking private prison companies to a case-by-case assessment. CoreCivic, a GEO rival, now has a BofA deposit account, Semafor reported in June.
People in today’s Trump White House are likely fully aware of what transpired. Attorney General Pam Bondi was reportedly a GEO lobbyist, and Secretary of Commerce Howard Lutnick’s Cantor Fitzgerald during Biden’s term helped GEO sell its shares, sources said and public filings show.
Omeed Malik
Former BofA Exec Omeed Malik was pushed out in 2018 for personal conduct in violation of firm standards before the GEO ban, and he too is close to the White House.
Malik in 2018 filed a $100 million claim against BofA with the Financial Industry Regulatory Authority and reportedly settled later that year for more than $10 million.
In 2022 he formed 1789 Capital to invest in anti-woke companies adding his very close friend Donald Trump Jr. as a partner.
CorpGov does not know if Malik has said anything critical about BofA to The White House.
Bank of America and Malik spokespeople declined comment. The White House, GEO Group, Anne Finucane and Andrew Plepler (neither of which is still at BofA) did not return calls.
Read more from Josh Kosman at https://joshonbusiness.substack.com
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