Trump poised to crack down on discriminatory debanking
President Trump is preparing to sign an executive order that would crack down on financial institutions that shut down customer accounts for holding the wrong views, the Wall Street Journal reported on Tuesday.
The practice, known as debanking, has primarily targeted conservatives and crypto companies. The executive order will direct financial regulators to investigate such institutions for violating the Equal Credit Opportunity Act, antitrust regulations, or consumer financial-protection laws.
On Tuesday, Trump told CNBC that JPMorgan Chase once gave him 20 days to move millions of dollars to another bank, and that Bank of America refused to allow him to open an account to deposit over a billion dollars. Stripe shut down the Trump campaign’s account immediately after January 6, 2021. In her recent memoir, First Lady Melania Trump slammed a bank that closed her and her son Barron’s bank accounts after the Trumps were ousted from the White House in 2020.
In May 2022, Chase Bank abruptly closed the account belonging to former U.S. Ambassador Sam Brownback’s National Committee for Religious Freedom (NCRF), a nonprofit aimed at safeguarding freedom for all religions. No transactions had raised any red flags. In 2021, a Chase-owned credit card processor notified the pro-life organization Family Council that “we can no longer support your business” because it was considered “High Risk.” The nonprofit did not meet any of the qualifications for the High Risk category.
WePay, a payment gateway owned by Chase, refused service to a conservative group because it felt its views supported “hate, violence, racial intolerance, [and] terrorism”. In 2021, Chase abruptly closed former Trump National Security Advisor Lt. Gen. Michael Flynn’s bank account for “reputational reasons,” according to The Heritage Foundation.
In 2020, Wells Fargo suddenly closed then-Republican Senate candidate Lauren Witzke’s bank account without explanation.
These are just some examples that led to Trump’s public admonition of major banks at the World Economic Forum’s annual summit in Davos in January.
I hope you start opening your bank to conservatives, because many conservatives complain that the banks are not allowing them to do business within the bank, and that included a place called Bank of America,” Trump told Bank of America CEO Brian Moynihan, who attended the summit. “They don’t take conservative business. And I don’t know if the regulators mandated that because of Biden or what, but you and [JPMorgan Chase CEO] Jamie [Dimon] and everybody, I hope you’re going to open your banks to conservatives, because what you’re doing is wrong.”
Government-sanctioned debanking
In December, billionaire startup investor Marc Andreessen explained to podcaster Joe Rogan how the federal government engages in debanking.
“We have this thing called the Consumer Finance Protection Bureau, CFPB, which is sort of Elizabeth Warren’s personal agency that she gets to control,” said Andreessen. “And it’s an independent agency that gets to run and do whatever it wants, right? And if you read the Constitution, there is no such thing as an independent agency, and yet there it is.”
Andreessen said the CFPB acts on Sen. Warren’s whim and is able to “terrorize financial institutions, prevent new competition, new startups that want to compete with the big banks . . . Just terrorizing anybody who tries to do anything new in financial services.”
“This is where a lot of the debanking comes from, is these agencies,” he continued. “So debanking is when you as either a person or your company are literally kicked out of the banking system.”
The investor explained that agencies like the CFPB allow the federal government to skirt the Constitution:
This is where the government and the companies get intertwined. Back to your fascism point, which is, there’s a constitutional amendment that says the government can’t restrict your speech, but there’s no constitutional amendment that says the government can’t debank you, right? And so they, if they can’t do the one thing, they do the other thing, and then they don’t have to debank you. They just have to put pressure on the private company banks to do it. And then the private company banks do it because they’re expected to. But the government gets to say we didn’t do it. It was the private company that did it. And of course JP Morgan can decide who they want to have as customers, because they’re a private company. And so it’s this it’s this sleight of hand that happens it — basically it’s a privatized sanctions regime that lets bureaucrats do to American citizens the same thing that we do to Iran. Kick you out of the financial system. And so this has been happening to all the crypto entrepreneurs in the last four years. This has been happening to a lot of the fintech entrepreneurs, anybody trying to start any kind of new banking service because they’re trying to protect the big banks.
