U.S. banks regulators have issued new guidelines aimed at preventing the controversial practice of “debanking,” in which customers or businesses lose access to financial services without a clear explanation.
The Office of the Comptroller of the Currency (OCC) said banks must ensure that decisions to terminate or restrict accounts are based on “transparent, risk-based criteria” rather than political or reputational considerations. The move comes amid growing scrutiny from lawmakers and advocacy groups who argue that some individuals and organizations have been unfairly cut off from the banking system.
“Access to banking services is fundamental to participation in the economy,” the OCC said in a statement. “Institutions should apply consistent standards and provide appropriate notice when accounts are closed.”
The new guidelines encourage banks to document the reasons for account closures, notify customers in advance, and establish appeals processes in certain cases. Regulators emphasized that while banks must manage risks related to fraud, money laundering, or other illicit activity, they should not deny services arbitrarily or without due process.
The issue has gained traction in recent years as businesses in politically sensitive sectors — such as firearms, cryptocurrency, or adult entertainment — have complained of being disproportionately targeted. Lawmakers from both parties have pressed regulators to clarify expectations and ensure fair treatment.
Industry groups welcomed the additional guidance but urged regulators to balance consumer protections with banks’ need to manage risk. “Clearer rules will help maintain trust while giving institutions confidence to make sound decisions,” one banking association said.
The guidelines will be implemented in stages, with regulators expected to review compliance during upcoming supervisory examinations.
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