President Donald Trump is reportedly preparing an executive order that would fine lenders for terminating customer relationships based on political affiliations or views.
The order comes as Trump continues to claim major financial institutions have denied access to right-leaning individuals and those connected to the crypto industry, although banks have rejected the assertion.
The order, which could be signed as early as this week, would direct regulators to investigate potential violations of the Equal Credit Opportunity Act, antitrust laws or consumer protection laws, and to block political bias in banking, according to The Wall Street Journal, which has reviewed a draft of the order.
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The disciplinary measures would include monetary penalties and consent decrees, according to the journal.
During an interview with CNBC on Tuesday, Trump used himself as an example, saying he was also personally targeted by several major banks, and had to rely on “small banks all over the place.” He spoke of a time that he was allegedly dropped as a bank customer, including at JPMorgan Chase.
The issue arose earlier this year when Trump accused Bank of America CEO Brian Moynihan in January of not offering banking to conservatives during the World Economic Forum.
“You’ve done a fantastic job,” Trump told Moynihan during a question-and-answer session, “but 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… They don’t take conservative business.”
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Moynihan did not respond to Trump’s remarks regarding fair banking for conservatives during the forum. A Bank of America spokesperson denied the bank has closed accounts for political reasons and said they “welcome conservatives.”
“We serve more than 70 million clients, and we welcome conservatives,” the spokesperson told FOX Business. “We are required to follow extensive government rules and regulations that sometimes result in decisions to exit client relationships. We never close accounts for political reasons and don’t have a political litmus test.”
Likewise, Patricia Wexler, a JPMorgan Chase spokesperson, also told FOX Business that the company doesn’t close accounts for political reasons, though it agrees with Trump that “regulatory change is desperately needed.”
In a statement to the Journal, Bank of America said it “will continue to work with the administration and Congress to improve the regulatory framework.”
Banks have been frustrated with regulation in the industry, claiming that it’s been unclear, politically driven and burdensome. Additionally, evolving rules, especially with crypto, expose them to certain risks. For instance, after FTX collapsed in 2022 – leading to the demise of Signature Bank and Silvergate in early 2023 – federal regulators informally discouraged banks from working with crypto clients.
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