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07-28-2003, 10:03 AM
Wal-Mart has made a number of attempts in the past to get into the financial services business, particularly banking. Supporters say such an entry will increase competition and reduce cost to consumers; opponents say what would have happened it Enron had been in the banking business?
"As originally written, a section of the proposed Financial Services Regulatory Relief Act of 2003 House Resolution 1375, introduced by Rep. Shelley Moore Capito, R-W. Va. would have allowed owners of industrial loan corporations to open branch offices nationwide. Industrial loan corporations are like banks except they dont offer on-demand checking accounts. Industrial loan companies only exist in five states."
"DANGEROUS GROUND Still, opponents of commercial ownership of banks worry that the retailer will use a change in the ability of industrial loan companies to branch to open a national bank. They ask what would have happened if Enron, the energy trading firm that withered into bankruptcy after its leadership made a slew of unethical decisions, had owned a bank. "If a commercial business is not doing very well, it is very tempting to upstream money from the financial institution for other uses" within the company, Gillmor said. "
Read article (http://www.nwanews.com/adg/story_Business.php?storyid=37158)
"As originally written, a section of the proposed Financial Services Regulatory Relief Act of 2003 House Resolution 1375, introduced by Rep. Shelley Moore Capito, R-W. Va. would have allowed owners of industrial loan corporations to open branch offices nationwide. Industrial loan corporations are like banks except they dont offer on-demand checking accounts. Industrial loan companies only exist in five states."
"DANGEROUS GROUND Still, opponents of commercial ownership of banks worry that the retailer will use a change in the ability of industrial loan companies to branch to open a national bank. They ask what would have happened if Enron, the energy trading firm that withered into bankruptcy after its leadership made a slew of unethical decisions, had owned a bank. "If a commercial business is not doing very well, it is very tempting to upstream money from the financial institution for other uses" within the company, Gillmor said. "
Read article (http://www.nwanews.com/adg/story_Business.php?storyid=37158)