Legal Commentary

Bank Ordered to Take Down Religious Displays [UPDATE: The Order Has Now Been Revoked]

By Eugene Volokh

KOCO-TV reports,

A small-town bank in Oklahoma said the Federal Reserve won?t let it keep religious signs and symbols on display.

Federal Reserve examiners [who came for a regularly scheduled inspection visit] deemed a Bible verse of the day, crosses on the teller?s counter and buttons that say ?Merry Christmas, God With Us.? ... inappropriate. The Bible verse of the day on the bank?s Internet site also had to be taken down....

Specifically, the feds believed, the symbols violated the discouragement clause of Regulation B of the bank regulations. According to the clause, ?...the use of words, symbols, models and other forms of communication ... express, imply or suggest a discriminatory preference or policy of exclusion.? ...

Sen. Jim Inhofe and Rep. Frank Lucas, both of Oklahoma, disagreed, in a press release and letter to Fed Chairman Ben Bernanke.

It seems to me that the Fed action is a pretty clear First Amendment violation. Businesses may indeed be barred from stating that they will not engage in commercial transactions with members of certain groups; that?s a somewhat unusual but well-settled aspect of First Amendment ?commercial speech doctrine,? which is more properly thought of ?commercial advertising doctrine.? (See Pittsburgh Press Co. v. Pittsburgh Comm?n on Human Rels. (1973), which has been cited favorably by the Court even in more recent commercial speech cases.) But businesses retain a First Amendment right to express their views, including even views that might be actually seen as insults to particular groups, see, e.g., Sambo?s Restaurants, Inc. v. City of Ann Arbor (6th Cir. 1981). And businesses certainly retain a First Amendment right to say things that might simply be seen as expressing endorsement of a particular religion.

Note, incidentally, that the bank regulators? actions, if accepted, would mean that a vast range of businesses ? not just banks ? would be barred from putting up religious symbols. The antidiscrimination rules applicable to banks are very similar to the antidiscrimination rules applicable to a wide range of businesses under federal and state laws.

Thanks to David Cavanagh for the pointer.

UPDATE: Well, that was quick ? The Oklahoman reports that ?The Christian-themed decorations are back at Payne County Bank after federal regulators relented in their demand that religious items in the bank?s lobby and website must be removed.? But the statement from the Kansas City Fed chairman is a bit confusing. It says,

Regulation B, as interpreted by the Board of Governors of the Federal Reserve System, does not apply to jewelry or other personal items displayed in the workplace.

But the materials, especially on the Web site, don?t seem just like ?personal items? put up by employees -? they seem like statements from the bank management itself. Is the Fed?s claim that employees may put up their own decorations and statements, but that the bank can?t put up decorations and statements endorsed by the management? Or is the Fed acknowledging that bank management can also put up religious statements endorsing a particular religion, which is how the bank has interpreted the Fed?s actions?

Full post as published by The Volokh Conspiracy on December 17, 2010 (boomark / email).