Bank of America’s “bad track” of debanking

A coalition of fifteen Republican state attorneys general sent a letter to Bank of America last Monday, expressing concern that the megabank has a pattern of closing the accounts of organizations with “religious and political views with which it disagrees.”

“Your discriminatory behavior is a serious threat to free speech and religious freedom, is potentially illegal, and is causing political and regulatory backlash,” the officials told the second-largest bank in the United States. “Your bank needs to be transparent with and assure us, its shareholders, and others that it will not continue to debank customers for their speech or religious exercise.”

According to the attorneys general, led by Kansas Attorney General Kris Kobach, Bank of America has a pattern of closing down accounts from organizations that don’t have the “bank’s preferred religious or political views.”

In 2020 Bank of America canceled the accounts of Timothy Two Project International, a U.S.-based nonprofit that trains Christian ministers who serve impoverished areas in South America, Asia, and Africa. The bank told the ministry it was closing its 9-year-old account because the ministry was “operating a business type we have chosen not to service.”

Bank of America did not offer additional information or provide a way to appeal the decision.

Three years later, Bank of America sent a cancellation letter to Memphis-based Indigenous Advance Ministries. The Christian nonprofit collaborates with Ugandan ministries to provide necessities and support for vulnerable children, families, and young adults. The closed accounts left Indigenous Advance’s partners short on funds.

When the ministry asked why the bank closed its account, Bank of America stated the nonprofit was “a business type we have chosen not to service at Bank of America.” A second letter from the bank added the terse remark that Indigenous Advance “no longer aligns with the bank’s risk tolerance.”

Shortly after this, Bank of America canceled the account of a Memphis church that had occasionally donated to Indigenous Advance and operated on its premises. Bank of America gave a similar reason for the cancellation.

These examples “strongly suggest that Bank of America is not just occasionally canceling groups under questionable circumstances,” the April 15 letter said. “Instead it appears to be systematically punishing religious and political views with which it disagrees.”

Bank of America has a “bad track” when it comes to debanking, said Jeremy Tedesco, senior vice president of corporate engagement at Alliance Defending Freedom.

This recent letter puts the megabank on notice that their behavior could have harmful consequences, Tedesco said. Big banks take the power of the states very seriously, he added.

The attorneys general delivered the letter a week before Bank of America’s annual shareholder meeting on April 24. The letter warns the bank that its actions expose it to “numerous legal and regulatory risks.”

However, there aren’t a lot of legal protections that guard against Bank of America’s questionable debanking actions, Tedesco said.

“The banks really have carte blanche to make these kinds of decisions,” he said. “We need counterweights, countervailing legal protections in law to ultimately stop these things from happening.”

Some states are stepping up to implement protective laws, he said. In March, Tennessee state senators moved to protect organizations like Indigenous Advance with a new bill that prohibits big banks from participating in politicized debanking. These protections were spurred on partly by a consumer complaint that Indigenous Advance filed against Bank of America in 2023.

The state attorneys general letter also references Bank of America’s score on ADF’s Viewpoint Diversity Score Business Index, which measures corporate respect for free speech and religious rights. Bank of America scored 8 percent out of a possible 100 percent on the Index in 2023. This is an “incredibly low” score, Tedesco said, and reflects how poorly Bank of America regards religious and speech freedoms.

Big banks have a growing trend of canceling accounts for political and religious reasons, Tedesco said. Many of the United States’ largest banks have vague, unregulated policies that give them room to shut down accounts without accountability or reason.

In 2022, the largest bank in the United States, JPMorgan Chase, canceled the account of the National Committee for Religious Freedom, founded by former senator and U.S. Ambassador Sam Brownback. The bank gave five “contradictory and unconvincing explanations” for the cancellation, according to ADF.

Big banks often shut down accounts because of increasing pressure from third parties, Tedesco said. Progressive activist organizations like the Southern Poverty Law Center have encouraged banks to debank those the organizations list as “hate groups,” he said.

“The reality is there’s not just a trend in debanking occurring, but there’s also an incredible amount of pressure on banks from both regulators and from private, third-party advocates to debank people,” Tedesco said. “Unfortunately what we are seeing more and more is the big banks playing politics rather than just trying to make sure that they provide viewpoint-neutral services to the general public.”