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Thursday, April 25, 2013

General Electric Cuts Lending Services to Firearm Retailers

Yesterday the Wall Street Journal reported that GE Capital is cutting off lending services to firearm retailers:
This month, Glenn Duncan, owner of Duncan's Outdoor Store in Bay City, Mich., said he received a letter from GE Capital Retail Bank in which the lender said it had made "the difficult decision" to stop providing financing services to his store. Other gun dealers have received similar notices.
This service was a financing option for customers who did business with firearm retailers, benefiting the buyer buy giving them options to finance large purchases, and the seller, by allowing them to make more sales of big ticket items to individual customers.  GE is ending the service for those retailers whose main business is firearms.
Daniel Johnson, a patrolman in the Bourbonnais Police Department in northern Illinois, said he got a loan to purchase a $2,250 Daniel Defense M4 Carbine, a sleek looking black rifle with plenty of "bells and whistles," after he was selected for the county SWAT team.

"It's kind of like, do you want to play basketball with Michael Jordan, or do you want to play with a local high school kid?" he said, explaining why he didn't use the standard-issue AR15 supplied by the force. Married with two kids and a mortgage, he found the three-year financing deal a "great help."
This is the latest move that began shortly after the Newtown shootings when Cerberus Capital Management LP said it would try to sell the gun company it owns—Freedom Group Inc.— which makes Remington, Bushmaster, Marlin and H&R branded firearms.  GE Capital is located in Conneticutt and according to the WSJ, many of the employees live around Newtown and have children in the Sandy Hook Elementary School.  The Journal also reported that the father of the Sandy Hook shooter is an executive with GE Capital.  GE Capital responded:
"Industry changes, new legislation and tragic events" led GE Capital to reexamine its policies on financing firearms, spokesman Russell Wilkerson said.
It remains to be seen how the change will affect gun owners and the industry but the message that it sends is what should concern us.

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