"Banks to porn stars: Your money's not welcome"

[MrRodry]

Banks to porn stars: Your money's not welcome

Chris Morris, Special to CNBC.com - May 17, 2013 at 11:52 AM ET

Chanel Preston knows not everyone approves of her chosen profession. That's one of the risks that go with being one of the biggest stars in porn. But she never thought it would affect her ability to open a bank account.

Preston recently opened a business account with City National Bank in Los Angeles. When she went to deposit checks into the account days later, however, she was told it had been shut down, due to "compliance issues".

She found the manager she had originally worked with and asked what had happened. The bank, she was told, was worried about the Webcam shows she had on her site and had revoked the account.

(City National declined to comment on Preston's accusations and on whether it had any policy regarding accounts tied to the porn industry.)

Preston is hardly the only porn star who has had trouble with the banking industry. Several performers and porn insiders (who were afraid to go on the record due to possible repercussions from their banks) said they have been denied accounts from a variety of financial institutions. (Related:Most Popular Adult Entertainment Stars)

"The people within my [local] bank have urged me to downplay the nature of my business because corporate frowns on it," said one long-time industry veteran.

The issue seems to be reaching a boiling point, though. Earlier this week, Marc Greenberg, founder of the soft porn studio MRG Entertainment, filed suit against JPMorgan Chase in Los Angeles Superior Court, alleging the bank violated fair lending laws and its own policy for refusing to underwrite a loan for "moral reasons".

Greenberg says he was approached by a representative of the bank about refinancing an existing loan. But once he started the process, he says he saw repeated delays for four months. That's when he said he reached out to a JPMorgan vice president for an explanation.

The vice president "was evasive in his response to plaintiff's application status requests and finally informed plaintiff during a telephone conversation that plaintiff's loan application was refused due to 'moral reasons,' because of JPMorgan's disapproval of plaintiff's former source of income and occupation as an owner of a television production company that produced television programs that dealt with the subject of human sexuality," the complaint reads.

(MRG was sold to New Frontier Media in 2006 for $22 million. Related:The Power Brokers of Porn)

Greenberg's attorneys claim they were told by the vice president that the application was denied because of the potential "reputational risk" to the firm.

The rejection, noted the suit, was confounding since Chase had long held the original deed of trust on the home, without any comment on Greenberg's career.

"JPMorgan purports to be so ashamed of nudity and human sexuality that it cannot process a refinance of a home loan of plaintiff, secured by plaintiff's house, because plaintiff's source of income six years ago included production of television programs that contained nudity and human sexuality," the suit reads.

JPMorgan Chase declined to comment on the accusations due to the pending litigation.

Preston noted she, too, has been denied a loan because of her profession—though at a different bank.

"[The loan officer] asked me 'are you affiliated with the adult entertainment industry?' When I said yes, she said 'We will not give you a loan.'," she said.

Whether the decision to deny Preston's business account or Greenberg's refinance application is discriminatory lending is a matter of debate—and, in Greenberg's case, something the courts will have to decide.

David Barr, a spokesperson for the FDIC, however, said institutions are permitted to make their own calls on who they work with to a certain degree.

"The decision to open or maintain an account is up to the individual institution," he said. "The rules are not prescriptive, which means that the bank must make its own assessment to determine the risks associated with an account and whether that account should be terminated or not opened in the first place."

And it is not uncommon for many businesses to take a moral stand about who they do business with. Indeed, some investment firms make it a point to avoid getting involved with tobacco producers or gun manufacturers because of the social issues tied to those industries.

Porn stars and adult entertainment industry insiders do note that the troubles they've experienced are tied to business—not personal—accounts. That may be because personal accounts are opened under their real names, which typically don't raise an eyebrow, while business is done under more well-known pseudonyms, which is when people take notice.

"It's kind of obvious about what I do when a young girl goes into a Valley bank with a different female name than the one on [their] driver's license," said Preston.

But such friction between people involved in the adult entertainment industry and banking institutions are likely to become more common. With the advent of the Internet, the $14 billion adult entertainment industry is undergoing a transformation. Film and video distribution is giving way to Internet sites and Web cams. As a result, barriers to entry in the industry are being lowered and more of the industry is being based out of homes and being run through small business arrangements and partnerships, necessitating banking services.

from http://www.nbcnews.com/business/banks-p ... -1C9967366

Oh CNB! :naughty:

 

[LuckySmiles]

This is a fear for me. I have my longest/best established history with Chase but am afraid to try with them for anything new.

 

[Jillybean]

This is a fear for me. I have my longest/best established history with Chase but am afraid to try with them for anything new.

I use Chase for everything. O_O I hope they don't shun me. I'm actually going there Monday to set up my "taxes" savings account, so...

 

[LuckySmiles]

This is a fear for me. I have my longest/best established history with Chase but am afraid to try with them for anything new.

I use Chase for everything. O_O I hope they don't shun me. I'm actually going there Monday to set up my "taxes" savings account, so...

You should be fine with giving them money haha. But with loans, they're a bit more tight than other banks. I have a checking,savings and a chase credit card with a VERRRY high limit. But I don't think they'd give me a loan for anything anytime soon. And it's not me being cynical. I won't even try right now.

 

[LilyPink]

Good publicity!

 

[SweepTheLeg]

I sure hope they don't extend this policy to those who watch Porn.

 

[emptiedglass]

What next?
I think banks taking the moral high ground is hypocritical. Just look at the interest rates they typically charge. They're a bunch of bloody thieves.

 

[SerenaMoon]

and don't mention the fees

 

[emptiedglass]

and don't mention the fees

I rest my case. :lol:

 

[Snowie1969]

Yeah, here in the Netherlands, prostitution is legal, but don't think you can start a sex business with a bank loan.. it will be denied. The banking world simply is too conservative for this sadly. And yet, the people making these decisions probably do invite $2000/h call girls to their offices on a regular basis..

 

[angrystan]

I hesitate to post as this is one of those topics I occasionally beat to death. However, it may be important.

Under the present economic and social conditions all for-profit financial institutions treat your deposits less as something held in trust, but more as a gift to them. If you are doing anything "sketchy" and that includes literally any kind of business transaction for which a W-2 will not be issued, the risk of using for-profit banks and similar institutions is simply too high.

Use credit unions. For everything. Credit cards will come in a couple of points lower. The fees for checking are tiny to often non-extant. IRAs tend to yield a point or two higher in this day and age which is significant. Most importantly they don't have a "public image" in the sense that the for-profit companies do. They only care when you are obviously doing something illegal. I have restaurant servers in my social circle who would consistently find their bank accounts locked due to regular, relatively high, cash deposits. This is not an issue with CUs.

In the entertainment biz, not just adult entertainment, the nature of income is so erratic and consistently different you will find the banks finding dozens of excuses to hold and reject deposits. Don't put yourself through that. Direct deposits tend to "land" 16-24 hours more quickly. When you get big enough to run everything through an LLC or similar, even if it's set up in the interest of protecting your intellectual property, this is where CUs shine.

To be sure, there are poor or high-fee credit unions. There are credit unions set up to serve religious communities who may not welcome you. Convenience and geography should not be your only priorities when choosing a banking institution, and this includes CUs.

 

[mynameisbob84]

This is truly pathetic. Of all the people to pretend that they occupy the moral high ground... fucking bank managers? Really? The mind boggles. I also wonder how much of the ridiculously large annual bonuses these guys take for themselves (despite the economy being in the shitter) is spent on porn, strippers and prostitutes.

The hypocrisy is astounding. Although, really I should be glad. If banks weren't hypocrital when it came to the sex trade and they made it as hard for the people who touch their pee-pees while looking at pornographic images as it seemingly is for some of the people who are in those images to open a bank account... I'd be keeping all my moneys in a shoe box underneath mah bed :?

 

[SoTxBob]

ok, some bean counter is missing the boat here..... with a multi-billion $$$ world wide industry, it seems someone would see the fruit on this tree and harvest it instead of letting it go elsewhere. perhaps even court the industry a bit by using something like 'X-Bank Intl.' and have a booth with some cheeky hot babes at the various expos.

 

[SweepTheLeg]

I should open a bank that only welcome's porn stars. I suppose I'll need a loan to get started

 

[TashaDutch]

what... the... fuck...

 

[Miss_Lollipop]

This is a real concern for me. I'm switching banks with my move, and need to find a bank that will let me open a biz acct.. but i am scared they'll turn me down

Maybe (after reading this thread) i should look into credit unions.

 

[spankamber]

why do they need details of what we do? i made a biz account un der my real name and have another one for SA productions just said film/video/ actress entertainment