Capital One closed bank accounts linked to Donald Trump in 2021 after identifying financial transactions that raised suspicions of money laundering, the bank revealed in a court filing made public over the weekend. The disclosure comes amid ongoing litigation initiated by one of Trump’s financial holding companies, which alleges that Capital One’s decision was politically motivated following the January 6, 2021, attack on the U.S. Capitol.
The lawsuit was filed shortly after Trump was inaugurated for his second term as president, asserting that the closures were retaliatory actions tied to political events. Capital One has filed a motion seeking dismissal of the suit, denying any political motivation behind its decision. The bank maintains that the closures were based on concerns related to financial compliance and risk management.
Trump has also pursued legal action against JPMorgan Chase, accusing the bank of similarly ending its banking relationships with him, his sons, and affiliated businesses after he left office. These actions are examples of “debanking,” a practice where banks terminate accounts due to perceived financial, legal, or reputational risks. The lawsuit against JPMorgan Chase includes a demand for $5 billion in damages.
JPMorgan has publicly denied closing accounts for political reasons, stating that it may close accounts “with or without cause,” particularly when accounts pose potential legal or regulatory risks. Both Capital One and JPMorgan Chase thus emphasize that their decisions were driven by compliance considerations rather than political affiliations or actions.
The cases highlight the growing scrutiny of banking institutions’ roles in managing high-profile clients and balancing regulatory obligations with reputational concerns. They also underscore broader debates over financial institutions’ rights and responsibilities in choosing their customers, especially amid heightened political tensions. The courts will ultimately determine whether the banks’ actions were justified or constituted unlawful discrimination based on political beliefs or affiliations.