As lawmakers work to avoid another partial government shutdown, Sen. Elizabeth Warren is keeping up pressure on big banks to make sure they help federal employees and contractors, especially if the “agreement in principle” falls apart.
“We are now less than a week away from the February 15 deadline to fund the government, and President Trump has threatened to drag the American public through a shutdown for a second time,” the Democrat from Massachusetts wrote in a series of new letters shared first with Roll Call.
Several weeks into the last shutdown, Warren sent letters to some of the nation’s largest financial institutions asking what sort of assistance they were providing to workers who were furloughed or working without pay.
And now the banks — Bank of America, Citigroup, JPMorgan Chase, U.S. Bancorp and Wells Fargo — have all responded to the senator and 2020 presidential hopeful. In the reply letters, the banks outline what they ultimately did to help their customers.
The responses, which were also reviewed by Roll Call, show that the banks generally treated government shutdowns as they would a natural disaster.
Take Citi, for instance.
“In the recent past, we have provided expanded hardship assistance to customers who were victims of natural disasters like hurricanes, volcanic eruptions and wildfires, including providing helpful customer communications and financial assistance,” wrote Citi President of U.S. Retail Banking and Mortgage Will Howle. “Citi considers a federal government shutdown a similar unexpected external event impacting our customers that requires a special response.”
Howle explained that Citi worked to identify accounts where there was a federal paycheck deposited through direct deposit and proactively refunded certain fees.
Credit unions that serve large populations of federal employees have long offered low-interest stopgap loans to those customers during shutdowns. Those loans can help customers avoid falling behind on bills, piling up credit card debt or having to resort to more extreme options like payday lending.
And at least one of the national banks that was the subject of Warren’s inquiries said it was now offering a similar lending product.
“Customers of U.S. Bank, who are qualified federal employees, can apply for a $100-$6,000 loan with a 0.01% Annual Percentage Rate (APR). This loan is available to eligible customers with any U.S. Bank product, including mortgage and auto loans or U.S. Bank credit cards,” wrote Andrew Cecere, the chairman, president and CEO at U.S. Bancorp.
In her responses dated Monday and shared first with Roll Call, Warren highlighted the ongoing plight of federal contract workers who may never receive back pay from the last shutdown. She specifically asked Cecere for a follow-up on the effort to expand those loans to contractors.
More generally, Warren asked for the relief programs to continue if there is another partial shutdown after Friday.
“I am writing today to urge that, should the President again refuse to fund the government, you continue your efforts to provide relief to government workers,” Warren wrote. “I also ask that you apply all relief you have offered to federal workers to federal contract workers who could lose pay as well. This crisis has affected millions of Americans, and you should extend your hardship programs as broadly as possible to help workers who are missing paychecks through no fault of their own.”
Warren is also asking the large banks for statistics on how many customers may be taking advantage of reversals of overdraft fees and other benefits that have been provided since late December.
In her reply to Wells Fargo CEO Timothy Sloan, for instance, the senator asked for what they may have discovered about changes in customer behavior.
“Since the shutdown began, have you analyzed potential indicators of sudden, widespread financial distress among your customers, such as spikes in account overdrafts or missed or late loan payments, particularly in areas of the countries with large numbers of federal workers or contractors?” Warren asked. “If so, please provide the results of those analyses.”