May 9, 2014 11:45 AM PDT    Text size: 

WASHINGTON — Adult industry attorney Lawrence Walters, who serves as general counsel for the Woodhull Sexual Freedom Alliance, said that J.P. Morgan Chase & Co.'s ultimate decision over "ill-conceived" policies involving customers who are also in the adult entertainment business may be a difficult one.

The controversy over Chase bank accounts and adult entertainers began last month after Teagan Presley told media outlets, including XBIZ, that Chase closed her account because the bank considered her "high risk."

Taking a stance on the matter, Woodhull said on Thursday that it is demanding Chase to stop "what is clearly discrimination against the adult entertainment industry."

The Washington-based group said that it communicated to the bank that it rejects its discriminatory acts directed at adult performers and has threatened to cancel its accounts and withdraw the organization’s funds if the practice is not terminated.

"Woodhull also has notified the bank’s loyalty partner organizations, Southwest Airlines and Amtrak, of its objection to the abhorrent discrimination against adult performers, in the hopes that these companies will put additional pressure on Chase to reverse course," Walters told XBIZ.

"Snuffing out the adult business thorough denial of banking access is an insidious form of censorship."

Walters, however, said that Chase’s ultimate decision will be a difficult, particularly since it appears that the Justice Department is applying its own pressure on the banking system to snuff out certain disfavored businesses through a recently uncovered initiative called “Operation Choke Point.”

"Under this program, the DOJ has tried to encourage federally regulated banks to avoid doing businesses with certain ‘high risk’ businesses such as get-rich-quick schemes, payday loan services, and pyramid schemes," Walters said. "But included in this blacklist is ‘pornography’ which happens to involve constitutionally protected speech. 

"Given Woodhull’s unique mission which focuses on protecting sexual freedom, it is well-positioned to call attention to this issue, and encourage a reversal of this ill-conceived policy of discrimination against customers based on their involvement with erotic expression. 

"Private businesses may be able to legally reject certain customers they disfavor, but when such decisions are made at the urging of the federal government, and based on retaliation for the exercise of speech protected by the First Amendment, a constitutional line has been crossed. 

Walters said that he applauds Woodhull’s "principled stance" on this matter and hopes that Chase will see "the error of turning its back on a billion-dollar business comprised of hard-working adults and small businesses."

"Organizations like Woodhull demonstrate the courage necessary to push back against the powerful banking and governmental interests at play, here and will hopefully encourage others to do the same."