The Indicator from Planet Money - Trump versus Capital One

Episode Date: August 18, 2026

The Trump Organization has sued Capital One for closing its bank accounts. The organization says it did so out of political reasons. But banks can close accounts for a zillion reasons. They don’t have to say why. Capital One cited money laundering as a concern. On today’s show, how banks decide to close accounts, how much politics plays a role and what the bank might have seen in its crime-stopping crystal ball.Fact checking by Sierra Juarez.Your Next Listen — What is a 'freedom economy'?Connect with The Indicator — Sign up for The Indicator’s weekly newsletter!— Buy the Planet Money book— Find our socials, YouTube and more!— For sponsor-free episodes, subscribe to NPR+ Support public media with NPR+ and enjoy perks for over 25 podcasts like this one. This show’s perks include sponsor-free listening. Learn more at plus.npr.org.See pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences.NPR Privacy Policy

NPR. You might assume that banks want your business. But not always. In fact, if you already have an account, a bank could simply ask you, hey, please pick up a check and take your business elsewhere. You know, nobody has a right to a bank account. It's up to the bank because a bank is not. Behind the ATMs and tellers, there's another division.

It's a detective agency called the Anti-Money Laundering Department. They're checking in on transactions, marking down. money flows that appear sketchy. This department can even shut down a bank account without telling the customer why. And it's this anti-money laundering department that allegedly found the Trump organization making some unusual transactions at Capital One. This is the indicator from Planet Money. I'm Ricky Mulvey. And I'm Adrienne Ma. Today on the show, we're stepping behind the curtain to find out why banks shut down accounts. And the controversial issue of debanking, how banks have cut customers for political or reputational reasons, and how all of this ties into the legal spat

between the Trump Organization and Capital One. That's after the break. So how do banks find suspicious activity? Well, first, the bank has to know who you are. Do you seem risky? Are you a schoolteacher, a small business owner? Are you a multinational real estate company? How risky you seem determines how much attention you get from the anti-money laundering team. They look into suspicious transactions to make sure that their bank isn't facilitating fraud, financing terrorism, you know, bad guy stuff. So banks are constantly looking at their customers. That's Les Joseph. He spent decades looking for financial crimes like money laundering at both the Department of Justice and Wells Fargo.

Les says money laundering teams can't look into every single transaction. I mean, a large bank has millions of customers after all. But the bank's detective team looks for sketchy transactions, off to. where businesses don't clearly connect. For example, a car wash in America making unusually large transfers to, let's say, a fried chicken restaurant in the Cayman Islands. If they see something unusual, they're not going to tell a customer, you know, you're kind of sketchy.

We're seeing activity in your account that makes us uncomfortable. They're just going to say, we're closing your accounts, and they're not required to give a reason. In fact, they often don't tell customers why they're shuttering accounts, because they might not want to tip off the customer to their other investigations into nefarious activity. Attention potential criminal. Please be more careful with your finances. Yeah, not exactly keeping a low profile. And these anti-money laundering divisions are highly structured, regulated, and they keep a lot of paperwork. So when they shut down an account, they aren't necessarily

accusing a customer of a crime, just, you know, suspicious transactions. So banks could shut down accounts because they find unusual activity. They don't want to facilitate anything criminal going on. But sometimes banks make decisions about who they keep as a customer for political reasons. This is called debanking. It happens when banks shut down an account for legal or even reputational risks. Les says his financial crimes unit was never told to go after accounts because they were in an unfavorable industry.

But he says that banks do worry about reputational risk. You know, feeling yucky about a certain kind of kind of. customer. The problem is that there isn't a clean way for banks to manage reputational risk. Brian Brooks was a bank regulator supervising national banks under the first Trump administration. Reputational risk is whatever you think it is. If you're a Democrat, you think it's reputational risky to bank an oil company. If you're a Republican, you think it's reputational risky to bank Planned Parenthood. Do we actually think those are financial risks that banks are in a position to mediate? Or do we think that's pure politics? Brian says that he saw political

pressure to shutter accounts that belonged to traditional energy companies, an industry that's out of favor with some on the left. And I was on a lot of calls as a regulator with some of these groups that would just come after me saying, how can you let these banks, you know, provide financial services to these people? And I would say things like, listen, if you're a bank that, for example, offers business checking accounts, you're literally telling me that this oil company that employs a thousand people shouldn't have a business checking account to make payroll. help me understand what risk that bank is managing. There's no risk of climate change other than you want to shut down the oil company.

And it's not the bank's business to make that decision. Brian also mentioned other coordinated attempts to choke off certain businesses, like payday lenders, sex-related products, tobacco products, pawn shops. We discovered that the FDIC was pressuring banks to stop serving those. And when that was revealed in 2014, there was bipartisan consensus that that was a terrible thing. You should not be kicked out of a bank account if you're not breaking the law, okay, or if you're not creating a risk like a credit default risk that the bank can't manage, okay? A business might have a problem when multiple large banks shut off services to its particular

industry. Last year, President Trump signed an executive order that said banks or regulators couldn't use reputational risk as a reason to close an account. Whether or not this has teeth in the long term really depends on congressional legislation. Now, how does all of this apply in the case of the Trump organization versus Capital One? Is it anti-money laundering or was it political? Does Capital One need a reason to shut out a customer? When Capital One originally closed the accounts, it didn't give the organization a specific reason why.

And one big question? Was this politically motivated? The closures came just a few months after the January 6th Capitol riot. However, Les says it got interesting after the Trump organization sued. What's unusual in this case is that Capital One came out and admitted what they believe and, frankly, what I believe is the real reason for closing the accounts is that they were based on financial crimes concerns. Another former Fed agrees. Dennis Lormel was chief of the FBI's financial crime section. He oversaw the team that identified where the 9-11 hijackers got their money, finding it just days after the attack. I would be inclined to believe the bank's position that they conducted an anti-money laundering investigation and they saw enough or they identified enough suspicious activity that raised that level of concern

to the point where they would have to or felt compelled to exit the relationship. Dennis says that these bank detective teams receive alerts for suspicious activity. That's what anti-money laundering teams respond to. Still, Les Joseph believes that the January 6th Capitol Riot may have added another layer. It might be possible that that's how Capital One looked at this. I said, we're looking at this activity in a different light. So now these transactions, which we were comfortable with, we're not certain we're comfortable with them anymore. And I think that's an important perspective to look at.

We reached out to the Trump Organization. In a statement, it said Capital One's decision. decision was baseless, and quote, plainly a politically motivated decision to debank the Trump accounts. We reached out to Capital One, too, and they told us that the bank doesn't comment on specific customer accounts or active litigation, and that it'll let their court filing speak for themselves. We should also say that Capital One is a financial supporter of NPR. And I have a Capital One bank account. And Adrian has a Capital One bank account. I haven't been debanked yet, but there's always time. Got to see how your cash-only car wash goes.

Now, we don't know exactly what Capital One saw in the Trump organization's transactions, but this may be a case where multiple things are true. Banks have shut down services to businesses in sectors they find disagreeable. Debanking is a political weapon. And anti-money laundering departments keep a lot of paperwork. Banks often shut down accounts they find engaging in suspicious activity. Adrian, I know we've got to wrap up. I know you've got to go run. your cash-only car wash.

On the advice of my lawyer, I played the fifth. This episode was produced by Vito Emanuel and engineered by Cina LaFredo. It was fact-checked by Sierra Juarez. Kate Canaan edits the show. The Indicator is a production of NPR.