Rep. Neal Patrick Dunn (R-FL) is a big fan of deregulation within the banking industry — he has voted for such legislation during his previous service as a state lawmaker and currently as a member of Congress.
Dunn also happens to be chairman of the board of directors of Summit Bank, a community bank in Panama City, Florida.
While members of the Senate are prohibited from sitting on a corporate board of directors, members of the House are free to do so — despite the obvious conflict of interest issues likely to arise.
> “It’s absolutely amazing that any member of Congress is allowed to sit on a board of any entity, especially a for-profit corporation,” Craig Holman, government affairs lobbyist at watchdog Public Citizen, told Sludge. “Whose interest are they going to be serving? As public officials, they’re supposed to be serving the public, but on a corporate board they have a fiduciary responsibility to serve the private interest of the company and its shareholders, not the public.”
According to Sludge, though chairing a board of directors is permitted, it does come with rules that must be followed:
> In 2017, Dunn earned $72,000 in “Director Fee/Stock Options,” per his disclosure. According to House rules, receiving director’s fees is not allowed. Members may serve on boards, “but they __may not be paid any directors’ fees__ or other compensation for that service.”
> Holman told Sludge that the disclosure “looks like it violates House ethics rules and conflict-of-interest law when he says the income is for ‘director fee.’ But then he adds ‘stock options,’ so it is not entirely clear to me what he is receiving compensation for. But if it is compensation for being on a board of directors, that violates the Ethics Reform Act and House ethics rules.”
Dunn has also shown himself to be a supporter of legislation that is friendly toward the banking industry:
> In 2013, Dunn lobbied for a bill in the Florida State Senate that would have clarified that Florida-chartered banks, like Summit Bank, could charge fees for clearing checks, a change that bill analysts said would result in additional revenue for Florida banks. The bill did not pass in that session, but similar language was included in a banking bill that passed in 2014.
After election to Congress in 2017, Dunn has lent his support to several bills seeking to deregulate banks:
> In May he voted in favor of S. 2155, a major banking bill focused on reducing regulations for medium-sized banks but that also includes several provisions benefitting small community banks like Summit Bank. For example, the bill exempts small banks from reporting requirements designed to prevent discriminatory lending, loosens regulations for participating in reciprocal deposit networks, allows small banks to take on more debt when acquiring other banks, and more.
> Dunn is also a co-sponsor of the Community Lending Enhancement and Regulatory Relief (CLEARR) Act, which primary sponsor Rep. Blaine Luetkemeyer (R-Mo.) describesas an attempt to “ease the burdens facing local financial institutions by providing them with targeted regulatory relief from an onslaught of federal red-tape.” Dunn also recently voted for a minibus appropriations bill that includes a package of deregulatory provisions supported by the banking industry.
Holman, who is currently discussing several initiatives that would bar House members from sitting on corporate boards with House Minority Leader Nancy Pelosi, indicated that Dunn’s case is the perfect example of why the rules need changed.
> “Receiving profits from the company, then owning stocks in the company, as well as being involved with legislation that could impact the bottom line of the company: That poses a very serious conflict of interest,” Holman said.