Overview

• The order directs the FDIC, OCC and Federal Reserve to remove vague reputational-risk provisions that regulators used to push banks toward ideological account closures.
• Trump’s lawsuit against Capital One over the shutdown of more than 300 accounts is advancing through the courts with the bank denying any political motive.
• JPMorgan Chase, Bank of America and at least ten other institutions closed or threatened to close Trump-linked accounts in early 2021 after informal warnings of heightened enforcement and potential fines.
• Agencies are drafting formal criteria for permissible account terminations to replace the subjective guidance that banks say exposed them to arbitrary regulatory actions.
• Legal experts and industry observers warn that without clearer standards the reputational-risk framework could be repurposed to target other lawful businesses or individuals based on ideology.