‘Debanking’ Draws GOP Lawmakers’ Attention

Political “debanking,” the practice of banks restricting or closing customers’ accounts for political or religious reasons, has once again become a hot topic, thanks to President Donald Trump and lawmakers in several Republican-governed states.

Conservatives appear to have been concerned about the practice since at least 2013, when the Obama administration launched Operation Choke Point, an initiative targeting the banking practices of businesses like firearm manufacturers and payday lenders.

Some claim the controversial operation involved the pressuring of banks to end their relationships with “high risk” businesses that the Obama administration didn’t like. Others say the program was a benign attempt at targeting unscrupulous business practices.

Whatever the case, in its wake some conservatives seem to have become convinced that banks may be cutting off businesses and people on ideological grounds.

Trump has taken up this cause in his second term, signing an executive order in early August that seeks to punish banks for restricting services to customers based on their beliefs.

“Many conservatives complain that the banks are not allowing them to do business within the bank and that included a place called Bank of America,” Trump said in January during a remote address at the World Economic Forum Annual Meeting.

Pursuant to the executive order, the U.S. Small Business Administration sent more than 5,000 letters to lenders in late August, telling them to end politicized debanking practices.

As with seemingly everything the president and his administration does these days, these actions on debanking have generated a lot of headlines. But state legislators have also been quietly beating the debanking drum for months now with the help of a prominent right-wing legal advocacy group.

Anti-Debanking Model Legislation Introduced in Seven States in 2025

This year lawmakers in at least seven states have introduced measures based on Alliance Defending Freedom’s (ADF) model legislation aimed at banning political “debanking,” the practice of banks closing or restricting customers’ accounts for political or religious reasons. Idaho enacted such a bill in March.

Red States Spring into Action

In March, Idaho Gov. Brad Little (R) signed SB 1027, the Transparency in Financial Services Act, which bans financial institutions with more than $100 billion in assets from terminating customer accounts over their political or religious beliefs.

The Idaho bill is the second anti-debanking law enacted in the United States based on model legislation drafted by the Alliance Defending Freedom, a conversative legal advocacy group known for its opposition to abortion and same-sex marriage.

Tennessee Gov. Bill Lee (R) signed a version of the ADF model legislation in April 2024. Florida enacted the nation’s first debanking bill in May 2023, although that legislation wasn’t based on the ADF model.

State lawmakers have introduced versions of ADF’s model bill 25 times in 17 states since 2024.

“Big Banks, which control services vital to our economy, are just as threatening to freedom as Big Brother,” said Jeremy Tedesco, ADF’s senior counsel and senior vice president of corporate engagement, in a statement after Idaho’s bill was signed into law. “Everyone needs access to basic financial services no matter their political or religious beliefs. States like Idaho are charged with the duty to protect their citizens from financial discrimination, especially from nationally chartered banks that function as quasi-government entities.”

This year at least nine bills based on the ADF model bill—including Idaho SB 1027—have been introduced in seven mostly GOP-led states this year, according to the LexisNexis® State Net® legislative tracking system. Five of those bills remain pending in three states: Iowa HB 594 and HB 922; Oklahoma SB 1107; and South Carolina HB 3296 and HB 3433.

The fight against debanking is clearly a Republican cause. But some on the Left, like the Southern Poverty Law Center, insist it’s nothing more than a conspiracy theory.

Another Front in Culture war

Last year, Southern Poverty Senior Research Analyst R.G. Cravens wrote: “Anti-LGBTQ+ hate group Alliance Defending Freedom (ADF) is engaged in an ongoing crusade to force private businesses to adhere to conservative Christian theology, in part by spreading the false narrative that private sector banks have been dropping conservative religious clients since the Obama administration. The conspiratorial claim, which ADF calls ‘debanking,’ has arisen out of an ongoing effort from ADF to ban or disrupt private sector investments in diversity, equity and inclusion (DEI) and environmental sustainability.”

In other words, Cravens’ argument is that the Right’s concerns about debanking are just an extension of its war on ESG and other forms of corporate responsibility, which conservatives say impinge upon people’s rights, but which progressives insist are important tools to leverage capital to foster a more just and sustainable world.

In fact, the Idaho bill explicitly calls out discrimination by “utilizing a social credit score,” which it defines as a means to evaluate an individual’s religious beliefs, freedom of expression or refusal to adopt environmental or diversity standards or facilitate an abortion.

Writing for the James Madison Institute, a conservative think tank in Tallahassee, Florida, Jack McPherrin and Justin Haskins tied the ideas of social credit scores and ESG, saying: “ESG metrics are a social credit scoring system that seeks to change how businesses are measured by banks, governments, investors, and other institutions. Rather than focusing upon a company’s quality of goods and services, profits, and other more traditional business metrics, ESG evaluates businesses largely upon their commitments to social justice and environmental activism. Companies are then assigned scores, usually a number or letter grade, so that businesses can either be rewarded or punished.”

As often happens in culture war debates, there is little agreement on the facts when it comes to debanking.

Tedesco, the ADF attorney and VP, wrote on social media in August: “Debanking is severely under-reported. Most victims I’ve spoken to won’t go public—fear of the stigma and of losing access to their money is that real.”

But Craven and fellow Southern Poverty Research Analyst Joe Wiinikka-Lydon said in April that the banks ADF accuses of debanking “deny the accusations” in the “limited examples” cited. They also note that “religious discrimination in banking is already illegal under federal law.”

Who is right in this case may not ultimately matter, however. With the Republicans’ party leader continuing to rail about debanking, legislators in Red states like Idaho, Tennessee and Florida are likely to keep pursuing bills to combat it.

—By SNCJ Correspondent BRIAN JOSEPH

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