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Andrew Cuomo’s Unconstitutional Assault on the NRA

New York’s governor is violating the First Amendment by pressuring banks and insurers to shun "gun promotion organizations."

Andrew Cuomo's methods may be obscure, but his assault on the First Amendment is anything but subtle. "If the @NRA goes bankrupt because of the State of New York," the governor tweeted in August, "they'll be in my thoughts and prayers. I'll see you in court."

That court is expected to decide any day now whether the National Rifle Association can proceed with its federal lawsuit against Cuomo, which charges him with using the state's Department of Financial Services (DFS) to pursue a "political vendetta against the NRA." The American Civil Liberties Union thinks the case should be heard, and it's not hard to see why, given Cuomo's thuggish abuse of regulatory powers to punish his opponents in the gun control debate.

"I am directing the Department of Financial Services to urge insurers and bankers statewide to determine whether any relationship they may have with the NRA or similar organizations sends the wrong message to their clients and their communities," Cuomo said last April. "This is not just a matter of reputation, it is a matter of public safety, and working together, we can put an end to gun violence in New York once and for all."

Maria Vullo, who runs DFS, was even more explicit. "DFS urges all insurance companies and banks doing business in New York to join the companies that have already discontinued their arrangements with the NRA," she said in the same press release.

The memoranda that Vullo sent banks and insurance companies that day urged them to "continue evaluating and managing their risks, including reputational risks, that may arise from their dealings with the NRA or similar gun promotion organizations." She said "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 manage these risks and promote public health and safety."

Two weeks later, as if to underline the dangers of doing business with "gun promotion organizations," DFS announced a consent decree with Lockton Companies, the New York administrator of Carry Guard, the NRA's liability insurance program for people who use firearms in self-defense. Lockton agreed to pay a $7 million fine for alleged violations of state regulations and promised to stop helping the NRA with insurance programs in New York, regardless of their legality.

Five days later, DFS touted a consent decree with Chubb, which underwrote the Carry Guard program overseen by Lockton. Chubb agreed to pay $1.3 million and shun the NRA not just in New York but throughout the world.

Lloyd's of London severed its relationship with the NRA two days after the Chubb consent decree was announced. Because of the state's implicit threats, the NRA says, it has had trouble finding companies willing to provide even basic banking and insurance services, much to Cuomo's gloating delight.

NRA critics who are inclined to share in that delight should consider the principle at stake here. "If the script was flipped," NRA lawyer William Brewer noted in an interview with Fox News, "and a conservative governor of Kansas was very pro-life, his administration could target Planned Parenthood's financial activity." Or insert the name of your favorite advocacy group.

The legal rationale for Cuomo's efforts to cut off the NRA's access to financial services, to the extent that one exists, is based on the concept of "reputation risk," one aspect of the "safety and soundness" that financial regulations are supposed to promote. In using a broad definition of reputation risk to attack legal commercial activities that offend him, Cuomo is taking a page from the Obama administration's Operation Choke Point, which mainly targeted payday lenders but also cautioned banks against serving "high-risk" dealers in pornography, firearms, and "racist materials," all of which are not just legal but constitutionally protected.

Cuomo seems to think there is no reputation risk for Democrats who violate the constitutional rights of their political opponents. I hope he is wrong.

Update: In a decision released on Tuesday night, U.S. District Judge Thomas McAvoy ruled that the NRA's case should proceed. "The allegations in the Amended Complaint are sufficient to create a plausible inference that the Guidance Letters and Cuomo Press Release, when read together and in the context of the alleged backroom exhortations and public announcements of the Consent Orders, constituted implicit threats of adverse action against financial institutions and insurers that did not disassociate from the NRA," McAvoy writes. "The Amended Complaint contains sufficient allegations plausibly supporting the conclusion that Defendants' actions were taken in an effort to suppress the NRA's gun promotion advocacy. Moreover, the NRA's allegations that Defendants' enforcement actions against Lockton and Chubb impeded the NRA's ability to enter contracts for lawful affinity insurance plans, but did not take similar action against other membership organizations that did not engage in gun promotion advocacy...provides a plausible basis to conclude that Defendants sought to impose a content-based restriction on NRA-affiliated businesses based on viewpoint animus that serves no substantial government interest." More here.

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  • Enjoy Every Sandwich||

    NRA critics who are inclined to share in that delight should consider the principle at stake here.

    I agree, but it's been my experience that those who use the state as a cudgel against their enemies never consider the principle at stake (or any principle for that matter). Then when, as predicted, their enemies use the same tactic to retaliate they have the nerve to be shocked.

  • Boomer||

    You mean sorta like Senate Democrats during the Kavanaugh confirmation? I bet they would've loved to have a filibuster.

  • Boomer||

    You mean sorta like Senate Democrats during the Kavanaugh confirmation? I bet they would've loved to have a filibuster.

  • Longtobefree||

    This reads like a textbook example of R.I.C.O. violations.
    Come on Jeffy, go get him.

  • Mickey Rat||

    Somewhere, a rope and lamppost awaits Lil' Duce.

  • geo1113||

    And I was just going to call him an asshole. Well done.

  • perlchpr||

    Lil' Douchey? *nod*

  • JesseAz||

    I'm just shocked we have a rare sighting of an actual libertarian stand on reason. It must be post election season.

  • Gozer the Gozarian||

    Fuck Cuomo in the ass until he bleeds.

  • Anomalous||

    Nice little insurance company you got there. It'd be a shame if anything were to happen to it.

  • Dadlobby||

    FUAC. Prince Andrew is looking to make himself the Socialist Emperor of the U.S. which is why he wages the moral busybody war and tyranny against any who own guns, oppose abortion, or vote "conservative" (to the right of his leftyness) who he said "have no place in his NY". 100,000 plus a year (me this year) flee upstate NY, as do many businesses. Oppressive use of Government is nothing new in Socialist regimes, one does wish the Rino-publicans would stop going along with the graft though.

  • TxJack 112||

    He will get slapped down in court just like Obama was over and over. Cuomo thinks he is way more powerful and important than he actually is. He is not going to bankrupt the NRA but rather he is going to drag NY state into a lawsuit that will cost them millions that they cannot win. His arrogance will spend taxpayer money on a personal crusade that will in the end do nothing to improve NY. NY has some of the most stringent gun laws in the US. How will stopping the NRA from selling gun owners insurance change that fact? Does he think if the NRA is gone, Democrats will be able to pass laws to ban all guns? HELLO, they just lost seats in the Senate and dont have the WH. Cuomo is the epitome of leftist arrogance and why he will never be anything other than Governor of NY.

  • TxJack 112||

    Not every insurance company is based in NY. There are other companies and they will pick up the business being dropped by these companies. There is no reason not to assume some companies may alter their current models to add these services. If there is money to be made, someone will be willing to figure out how to make it. The only thing Cuomo will accomplish in the end is make carry insurance unavailable in NY.

  • Naaman Brown||

    Cuomo is pressuring insurance companies based outside NY who do business in NY. If they want to continue to do business in NY, they must stop doing business with NRA.

    The insurance for gun owners who use guns in self-defense is to prevent them from being bankrupted by costs of going to trial when they are acquitted on grounds of self-defense. The cost of going to trial in a self-defense case is usually devastating. Especially in NY.

  • JP88||

    Cuomo is an authoritarian.

  • Unicorn Abattoir||

    Cuomo seems to think there is no reputation risk for Democrats who violate the constitutional rights of their political opponents.

    It would seem that rather than risking their reputation, this type of behavior bolsters it.

  • Uncle Jay||

    The little people in America do not need guns.
    Only government officials need guns to enforce their wise and beneficial diktats to the hoi poiloi and to protect these officials from possible attacks from counter-revolutionary reactionaries who still bitterly cling to the ideals of freedom.
    This has idea has worked out well for Hitler, Stalin and Castro.
    Need more evidence.
    Look no further than Mexico for their low gun-related murders lately.

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