OCC Issues Guidance to End Political Debanking of Customers

The Office of the Comptroller of the Currency issued new guidance on Monday to eliminate debanking, the practice of closing customer accounts based on political or religious beliefs. Acting on an August executive order from President Donald Trump titled Guaranteeing Fair Banking For All Americans, the regulator is moving to end the weaponization of the financial system and root out unlawful discrimination.

As part of this initiative, the agency requested information on debanking activities from its nine largest regulated institutions. The regulator is preparing a rule to remove references to reputation risk from its regulations, a concept the administration argues may enable unlawful debanking. The agency is also reviewing consumer complaint data and updating its Bank Secrecy Act and anti-money laundering supervision to ensure these processes do not contribute to discriminatory account closures.

To enforce these standards, the agency announced it will incorporate debanking activities into its licensing evaluations and Community Reinvestment Act ratings. While the White House and conservatives allege that banks target right-leaning speech and businesses, some consumer advocates and a Reuters analysis suggest there is little evidence that debanking is widespread.