Industry as Payments Cop: Will Idea Stop at Gambling?
Kaper, Stacy, American Banker
WASHINGTON -- Financial services representatives are growing increasingly nervous about an upcoming debate on the industry's role in combating online child pornography.
The topic is the subject of three hearings scheduled for this week on Capitol Hill. Two Senate panels are reviewing voluntary private-sector efforts to identify and put child porn Web sites out of business, and a House committee is considering what the financial industry's responsibility should be to solve the problem and is toying with a legislative fix.
Industry representatives said they worry that legislation the House passed July 11 that would require banks to block certain payments to gambling sites has created a precedent in which Congress relies on the payments system to curb unlawful activities.
Several sources said lawmakers could use that approach to combat online child porn.
"We recognize that these are logical social concerns," said Floyd Stoner, the head lobbyist for the American Bankers Association. "We are always concerned about new requirements, especially when we believe the focus should be on those carrying the images."
Several lobbyists said the most likely candidate to produce legislation is the House Energy and Commerce Committee. Led by Rep. Joe Barton, R-Tex., the committee frequently has passed bills affecting banks, and it has clashed with members of the House Financial Services Committee on issues such as data security.
Sources said Rep. Barton is considering offering legislation that would hold banks accountable for blocking payments for child porn. Details of the measure are unclear, though some said it might penalize companies that knowingly allow payments to porn sites.
The committee's oversight and investigations subcommittee is scheduled to hold a hearing Thursday to examine the responsibility of banks and others to help law enforcement agencies in shutting down commercial child porn sites.
"Certainly, we wouldn't preclude the possibility of legislation," said Kevin Schweers, a spokesman for the Energy and Commerce Committee. However, such speculation is "premature," since the committee has not finished investigating the issue, he said.
The Senate Banking Committee is expected to highlight an approach that would not entail more legislation for banks. The panel is scheduled to hold a hearing today that will showcase a voluntary initiative by the financial services industry to stop online child porn. …