AFFM: Proposed South Carolina Bill Will Increase Red Tape, Government Interference

“We don’t want more bureaucratic red tape. We don’t want, more government interfering, in our business, and consumer, lives and activities. That’s just not the South Carolina way.”

In case you missed it, Americans for Free Markets (AFFM) Executive Director David Ibsen joined The Point Radio with Kevin Cohen to discuss the real-world implications of South Carolina’s proposed Guarantee Banking Act (HB 5538 / SB 1069), which aims to address concerns around politically and ideologically motivated debanking at the state level.

While well-intentioned, Ibsen emphasized that the most effective solution would instead be a uniform federal approach rather than a 50-state patchwork of regulation.

“You do not want 50 different, regulatory processes in place that make it impossible for South Carolina businesses to operate across state lines.”

Last week, in an op-ed penned by Ibsen, he underscored the importance of how South Carolina’s very own U.S. Senator Tim Scott is already leading on the issue by introducing his own bill.

“Senator Scott has taken the lead in Congress, introducing the Financial Integrity and Regulation Management (FIRM) Act to codify the removal of vague definitions of risk — the vehicle used by regulators to pressure banks into closing accounts — from supervisory standards.”

When asked about this specific bill’s shortcomings, Ibsen noted the legislation would create significant regulatory burdens for banks and businesses operating in South Carolina.

“I think the state Senate is inadvertently creating a dual system of compliance and regulatory obligation. All that extra compliance and legal work will ultimately lead to more red tape, higher costs, and reduced access, especially for smaller, community banks in South Carolina.”

In addition, Ibsen raised concerns about the bill’s language, warning that it could expose both banks and businesses to increased litigation, including frivolous lawsuits.

In closing, Ibsen pointed to states like Alabama, Texas, and Louisiana, which are aligning with federal efforts to address debanking, and urged South Carolina lawmakers to do the same. He encouraged listeners to contact their legislators to oppose the bill, citing concerns over increased red tape, higher compliance costs, and the need for a consistent national standard.

Listen to Ibsen’s full interview HERE and read his op-ed on The Point’s website HERE.