Major U.S. banks have defended their decisions to close certain accounts, attributing them to regulatory concerns over reputational risk rather than political discrimination, sources familiar with the matter said. This pushback comes in response to former President Donald Trump’s claims that he and his conservative supporters were unfairly denied banking services.
Trump recently renewed his criticism of JPMorgan Chase and Bank of America, accusing them of rejecting hundreds of millions of dollars in deposits linked to him. However, two industry insiders pointed to regulations enacted under President Joe Biden’s administration, which pressured banks to consider reputational risk when managing clients, News.Az reports, citing Reuters.
One source noted that Trump’s legal challenges during Biden’s presidency raised concerns for banks about regulatory scrutiny. Both JPMorgan and Bank of America denied that political views influenced their banking decisions and welcomed Trump’s call for regulatory reform.
JPMorgan reportedly still maintains banking relationships with members of the Trump family and manages several campaign accounts associated with Trump.
The Biden-era rules gave regulators broad discretion to assess reputational risk, which banks said was often subjective and opaque. However, leading U.S. financial regulators—including the Federal Reserve, FDIC, and OCC—have recently instructed supervisors to stop factoring reputational risk in bank examinations, responding to industry complaints.
The Bank Policy Institute, an industry group, described the issue as “regulatory overreach and supervisory discretion.” A forthcoming executive order is expected to direct regulators to review potential “politicized or unlawful debanking” practices.
Beyond political figures, banks have faced criticism from conservatives over alleged “woke capitalism” and restrictions on clients in industries like firearms and fossil fuels. The Trump Organization filed a lawsuit earlier this year against Capital One over closed accounts following the January 6 Capitol riot.
Bank officials emphasize the confidential nature of supervision, which limits their ability to explain account closures to customers. Critics argue this lack of transparency leaves individuals uncertain about the reasons behind being “debanked.”
