09/09/08 Bank Closes Accounts

Bank Closes Accounts. I'm Greg Martin with today's Line On Agriculture. Dan Fazio, Director of Washington State Farm Bureau's Employer Services was broadsided. Recently during an I-9 training session he was asked about an issue that has opened a can of worms. The question stemmed from several ag producers in the Shelton, Washington area that received a letter from their bank. FAZIO: Important information about your Key Bank account and service. Please be advised that on September 15th your account will be closed. Any associated ATM, debit card, online banking or treasury management account will be revoked on August 30th as permitted by our applicable agreement with you. We have determined that your business is a high risk relationship for Key Bank and feel that continuing this relationship is not in the best interest of Key Bank. According to Fazio these businesses all have very high credit ratings. FAZIO: These people have 800 credit scores; have been banking with Key Bank for 20 years. Key Bank just sent them a letter saying we're going to close your account. They didn't give any reason. The businesses employ seasonal workers to gather materials to be used in making holiday wreaths and is careful about the workers hired. Fazio says that L&I got involved in the process. FAZIO: They were in a lawsuit or controversy with L&I for the last 5 years where L&I wanted them to employ these people that come and sell them the greens because L&I said we want someone to cover these guys for worker's comp and the company said number one, these guys are not employable. A lot of them are fishermen or illegals or whatever. And number 2, we couldn't control them. We don't have enough people to go out and say clock in a 8 and clock out at 4. That suit has been dropped but somewhere in the process Key Bank has made the determination that these long-standing customers are now a risk and has closed their accounts. FAZIO: It could be the Department of Homeland Security doesn't want them to do business, it could be that L&I called up, it could be something else. But no one knows right now. The is a complaint with the office of the controller of the currency to find out but all these people have is a 20 year relationship, 800 credit scores, never defaulted on a payment or a loan, small businesses that employ anywhere from 20 to 200 people and they've been asked to leave Key Bank. That's today's Line On Agriculture. I'm Greg Martin on the Northwest Ag Information Network.