Jenna Ashkenazie
Debanking has affected many people in our community. As this issue prevails, we, as a community, have begun to conjecture that when this happens, it is not simply a coincidence, but is something more politically charged.
Debanking History
Debanking is defined as “the closure of a person’s or organization’s bank accounts by financial institutions that perceive them to pose a financial, legal, or reputational risk.”
Debanking had become such an issue that on August 7, 2025, President Donald Trump signed an executive order, “Guaranteeing Fair Banking for All Americans,” instructing federal agencies to stop debanking that can be considered politicized or unlawful. The executive order stated, “Bank regulators have used supervisory scrutiny and other influence over regulated banks to direct or otherwise encourage politicized or unlawful debanking activities.” In 2013 “Operation Chokepoint,” for example, was a well-documented and systemic means by which federal regulators pushed banks to minimize their involvement with individuals and companies engaged in lawful activities and industries disfavored by regulators (such as firearms dealers, payday lenders, and coin dealers calling them “high risk” for fraud and money laundering) based on factors other than individualized, objective, risk-based standards.
As a result, individuals, their businesses, and their families have been subjected to debanking on the basis of their political affiliations, religious beliefs, or lawful (but disfavored) business activities, and have suffered frozen payrolls, debt and crushing interest, and other significant harm to their livelihoods, reputations, and financial well-being. Such practices are incompatible with a free society and the principle that the provision of banking services should be based on material, measurable, and justifiable risks.
OCC and FDIC Step Up
Ballard Spahr LLP (a leading US law firm) reported that in April of 2026 the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) adopted a joint rule to “prohibit the agencies from criticizing or taking adverse action against a financial institution based on reputation risk.”
The rule will also prohibit the agencies from “requiring, instructing, or encouraging an institution to close customer accounts or take other actions on the basis of a person or entity’s political, social, cultural, or religious views or beliefs, constitutionally protected speech, or solely on the basis of politically disfavored but lawful business activities perceived to present reputation risk,” according to a statement from the agencies.
Ballard Spahr LLP continued to report, “While a bank’s reputation is critically important, and many financial institutions over the years have failed due to a loss of confidence, supervisory focus on ‘reputation risk’ outside of traditional risk channels (such as credit risk or market risk) adds little value to promoting safety and soundness.” FDIC Chairman Travis Hill said, “On the other hand, an explicit or implicit focus on ’reputation risk’ untethered from other risk channels can pressure banks into debanking law-abiding customers who are viewed unfavorably by supervisors.”
Close to Home
While this action – preventing legitimate organizations and individuals from being unfairly debanked – is greatly appreciated by many, the question begs asking, what about those who were affected before the new rules were put into place? For example, about four to five years ago, a very prominent synagogue and Torah center in our community was debanked.
One day, out of the blue, a letter arrived stating that Chase Bank was closing the synagogue’s account and that they had thirty days to collect the money in the account, which had been opened over the thirty years ago. . The office manager immediately went straight to Chase Bank. She attempted to get answers as to why that letter was sent, and what could be done to preserve the account.
Instead of providing real answers, the bank teller told her that new rules had been put in place allowing banks to debank organizations without even providing a reason. There was no explanation, and no ability to negotiate. The office manager’s only option was to take the check, which included the full balance in the account, and open an account at a new bank, which she did.
Connecting the Dots
The synagogue’s office manager stated later, “When I was going through it, I was very surprised. I have never heard of anything like it. But as I was talking to people about it, more people were saying it had happened to them as well. All people from the community, all given no answers as to why. Every day I would hear about two to three people who it had happened to.”
With banks now no longer required to provide reasons for debanking, no one in the community had been given any explanation, leaving room for speculation. “I would believe that it all had to do with international wiring. That is what we were able to come up with.” The synagogue is a nonprofit, which deposits all of their donations into their bank account. They pay all of their bills on time. They did nothing wrong, nothing to warrant being debanked after thirty years of being model banking clients. The only thing that had changed, was about a year or two before they were debanked, the synagogue had begun sending support directly to causes linked to Israel. Is it a coincidence that it was only after this new development that they were debanked? Or a politically motivated attack? It is nearly impossible to know for certain.
As time has passed, similar stories have come out. Another community member was also debanked by Chase with no explanation. To make matters worse, the bank never even sent him advance notice of the account closures. “We had a bunch of checks that were issued to vendors at the time, many of which were already sent for deposit so there was no way to stop them from bouncing. When some of the larger checks we issued to vendors were dishonored, it caused a cascade of check rejections as the payments they issued to their vendors and employees were returned for insufficient funds. We ended up eating thousands in fees from vendors while Chase refused to even acknowledge their negligence.”
Question Left Hanging
He was never provided with a reason for the account closures but noted that he had made a very substantial donation to a Jewish organization just a few months before the account closure. There is no way to know for certain why a particular account was closed, or why certain organizations get debanked. We can only speculate. However, it is difficult not to wonder if things like donations to Jewish organizations, or supporting Israeli organizations are a major factor in the mass debanking.