Trump Moves to Ban ‘Debanking’ of Conservatives and Crypto Firms

In a televised CNBC interview on August 5, President Donald Trump claimed that major banks, including JPMorgan Chase and Bank of America, refused to accept his deposits after he left office in 2021, forcing him to rely on smaller banks. He alleged that JPMorgan gave him just 20 days to close longstanding accounts.

While those banks denied discriminating for political motives, citing compliance burdens associated with “politically exposed persons”, Trump hailed the forthcoming order as overdue corrective action.

A draft executive order, as reported by the Wall Street Journal, would direct regulators, including the Consumer Financial Protection Bureau (CFPB) and the Department of Justice, to investigate closures under statutes such as the Equal Credit Opportunity Act and antitrust or consumer-protection laws. Penalties might include fines, consent decrees, or other enforcement actions.

The draft also instructs regulators to assess whether existing bank policies effectively encourage politically motivated account terminations, particularly those linked to industries such as cryptocurrency or groups tied to conservative activism.

“Debanking” refers to claims that financial institutions denied services to individuals or businesses due to political beliefs, religious views, or industry associations. These complaints have increased sharply in recent years, prompting hearings by the Senate Banking Committee and investigations by the House Oversight Committee.

Crypto firms have been among the most vocal critics. Some digital‑asset entrepreneurs described being shut out of banking services during the Biden administration, alleging informal pressure to abandon relationships with crypto companies, a trend critics dubbed “Operation Chokepoint 2.0.”

In response, the Trump-era White House reversed elements of prior digital‑asset policy by rescinding Biden’s guidance and directing agencies to eliminate restrictions on crypto‑related banking services. A special working group chaired by a crypto‑focused advisor was tasked with reviewing rules affecting digital‑asset firms.

Major banks have pushed back against claims of ideological bias in account closures, attributing decisions to legal, reputational or financial risk factors, including regulatory scrutiny over politically exposed people.

Industry representatives, such as the Bank Policy Institute, argue that the root issue lies in regulatory overreach and inconsistent enforcement rather than partisan intent. They called on regulators to revise the current supervisory framework to address closure practices.

If enacted, the order would apply to banks of significant size, requiring evidence-based closure justification and potentially imposing enforcement action if ideological bias is found. Supporters believe it could fill a regulatory gap and restore confidence among conservative or crypto‑sector clients.

However, executive orders cannot override existing civil rights laws, and federal courts have long upheld doctrines such as disparate‑impact liability, a legal standard that allows enforcement of facially neutral policies that disproportionately affect protected classes.

The order may also face pushback from civil‑rights groups concerned that efforts to limit disparate‑impact enforcement could reduce legal protections for marginalized borrowers in lending and banking contexts.

The proposed executive action comes amid sweeping removals of diversity and inclusion (DEI) policies in banking disclosures, triggered by earlier orders that rescinded federal enforcement of DEI programs and disparate‑impact standards. Banking regulators and securities agencies have already scrubbed DEI webpages and framed the shift as alignment with a merit‑based vision of opportunity.

The timing suggests a broader administrative objective: reasserting executive authority over once-independent regulatory agencies and diminishing the influence of rule‑making driven by enforcement guidelines.

As of August 5, no final order has been signed, and its contents remain subject to revision. Its implementation would likely ripple across banks’ compliance procedures, potentially forcing more transparency around account closures and prompting legal scrutiny into whether political belief or industry affiliation can legally motivate a denial of service.