Trump's Debanking Order Creates Regulatory Dilemma

US President Donald Trump signed the “Guaranteeing Fair Banking for All Americans” executive order on August 7, 2025, directing the Federal Reserve, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency to stop using “reputational risk” in bank supervision. The policy is intended to prevent financial institutions from denying services based on political or religious views. The order did not involve any specific transaction amount.

The order gave regulators 180 days to remove the relevant guidance, and the OCC and FDIC subsequently eliminated additional references to “reputational risk.” Banks must still conduct anti-money laundering reviews and file suspicious activity reports under the Bank Secrecy Act. The industry worries that rejecting high-risk customers could be viewed as debanking and is calling on regulators to establish uniform decision-making standards.