States' financial leaders unite with Trump in a bid to halt the practice of "debanking"

President Donald Trump has taken a significant step towards ensuring fair treatment in the financial sector with a new executive order. The order aims to stop political activism in financial institutions and end the practice of denying, restricting, or closing an individual's or organization's access to banking services.

The executive order targets banks that deny or restrict services based on political beliefs, religious beliefs, or lawful business activities. It applies to all financial institutions subject to federal regulation and includes penalties for those refusing services unfairly, particularly emphasizing fair treatment of registered cryptocurrency firms.

A coalition of 31 state financial officers, including treasurers, auditors, and comptrollers from 23 states, have backed Trump's executive order. OJ Oleka, CEO of the State Financial Officers Foundation, echoed the sentiment that political agendas have no place in banking, stating, "activism ends now."

The coalition argues that debanking practices have distorted the role of risk assessment and undermined Americans' access to basic financial services. Trump claims that he has been targeted by debanking efforts, which he attributes to political bias from bank regulators. Will Hild, executive director of Consumers' Research, stated that major banks like JPMorgan Chase are making it clear that if one holds conservative views, they are a threat to their 'reputation.'

Under the new executive order, federal banking regulators will be required to eliminate references to reputational risk and similar provisions from their guidance and examination manuals. The Small Business Administration has been directed to make efforts to reinstate clients previously denied services due to debanking practices.

The order also instructs federal banking regulators to review complaint data for instances of debanking and to refer relevant cases to the attorney general. Rep. Andy Barr, R-Ky., discussed President Donald Trump's executive order to stop banking discrimination on 'Mornings with Maria.'

The coalition's joint statement calls for an end to discriminatory debanking and states, "let us send a clear message: discriminatory debanking stops now." The executive order is aimed at stopping the 'pernicious practice' of debanking, a move that could significantly reshape the financial landscape in the United States.