Federal watchdog says 9 large US banks denied service to customers over political or religious views

The Comptroller of the Currency says the nation's nine largest banks denied financial services to customers based on their political, religious, or social beliefs, according to a regulatory review released Wednesday.

The OCC reviewed nearly 100,000 complaints and received approximately 50,000 documents from JPMorgan Chase Bank, Bank of America, Citibank, Wells Fargo Bank, U.S. Bank, Capital One, PNC Bank, TD Bank, and BMO Bank regarding their policies, procedures, practices, and individual customer decisions.

The federal banking watchdog determined that the banks' sweeping internal guidelines lacked objective, risk-based criteria, effectively shutting out legitimate customers and businesses based on ideological leanings rather than financial risk.

The OCC said its findings reveal a systematic effort within the banking sector to restrict access for politically sensitive industries through both public and nonpublic policies.

Federal regulators found that lenders restricted certain sectors' access to financial services, including oil and gas exploration; coal mining; firearms or ammunition manufacturing or distribution; construction or operation of detention facilities; and the manufacturing, distribution or online retail of tobacco or e-cigarettes.

The Trump administration has voiced growing concerns over "de-banking" and the use of the financial system to achieve social and political objectives.

"Today's report provides irrefutable evidence that the nation's largest banks have denied, debanked, and discriminated against customers and lawful businesses," said Comptroller of the Currency Jonathan Gould. "Americans should have access to financial services regardless of their beliefs, affiliations, or political views. "

All nine banks report having reassessed the role of reputation risk in decisions to accept or terminate new customers, according to the OCC's report. Several banks said they had minimized reliance on reputation risk, and bank employees now must consider it in the context of other financial or business consequences, including credit risk, money laundering and terrorist financing risk.

The Bank Policy Institute, a lobbying group that represents the banks, said in a statement in reaction to the report, "We support efforts to establish clear and consistent standards that promote access while maintaining sound risk management, including the administration's recent efforts to prioritize supervisory attention on material financial risk and rather than reputational risk."