Justice Department subpoenas major banks over account closures for political reasons

The US Justice Department has subpoenaed large banks over allegations that they improperly closed customer accounts for political reasons.

The investigation falls under a broader crackdown on what’s commonly called “debanking” — banks cutting off customers not because of fraud or risk, but because of who they are, what they believe, or what legal industry they operate in.

A task force with teeth

In April 2025, the US Attorney’s Office for the Eastern District of Virginia launched a dedicated task force to investigate illegal debanking.

In August 2025, President Trump signed an executive order addressing debanking head-on. The order mandates federal regulators to tackle politically motivated account closures and, critically, to eliminate reputational risk considerations from regulatory guidance.

In March 2025, Trump-affiliated companies sued Capital One for allegedly closing roughly 300 accounts for political reasons.

The ghost of Operation Choke Point

The roots of the debanking debate stretch back to Operation Choke Point, a DOJ initiative launched during the Obama administration between 2013 and 2017. The program was designed to pressure banks into cutting ties with businesses the government considered high-risk, including payday lenders and gun dealers.

During the 2024 election cycle, crypto firms reported increased debanking pressures, with companies finding their accounts frozen or terminated with little explanation. Founders have described showing up to work to find their company’s bank accounts closed, with no prior warning and no clear violation cited.

What this means for crypto and investors

A crypto exchange that can’t hold a bank account can’t process fiat on-ramps for customers. A DeFi company that gets debanked can’t pay employees through normal payroll. A stablecoin issuer that loses its banking relationships has a product-defining problem.

The executive order eliminating reputational risk from regulatory guidance removes a structural incentive for banks to preemptively cut ties with controversial but legal businesses. However, executive orders can be reversed by future administrations.

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