The White House is preparing an executive order to punish banks that close customer accounts based on political beliefs. Regulators investigate violations of fair lending, antitrust laws and consumer protection laws that result in potential fines and legal consequences. The order also covers internal banks and SBA policies that may have led to politically biased decisions.
The White House is gearing up to remove executive orders that could seriously shake up the way banks handle customer accounts. According to the Wall Street Journal scoop, this new directive is a great financial institution for launching clients based on political views.
Regulators have directed them to investigate and enforce
The draft reportedly directs federal bank regulators to find out if the bank has stepped through legal lines. If shade practices become apparent, expect financial penalties, legal agreements (think agreements), or other types of regulatory smackdowns.
Modify the policy as well as symptoms
But it’s not just about punishing the bank after the fact. It also requires regulators to identify and remove policies that may have encouraged this type of selective account to be dropped in the first place. Essentially, it asks: how did this become an object?
The SBA is also under the microscope
Small and Medium Enterprise Management (SBA) is also not on the hook. The order reportedly requires SBA to review the banks that offer SBA guaranteed SBA loans. They want to make sure those banks are fair and not intentionally discriminatory when deciding who will borrow or who will not.
The White House is preparing laws to fine banks over cryptographic discrimination and political bias.
