In America, no one should have to worry about losing access to essential financial services because of their political or religious views.
That’s why 13 state financial officers wrote an open letter calling on J.P. Morgan Chase Bank to end its troubling trend of politicized debanking and commit to shareholder transparency by responding to the survey portion of the Viewpoint Diversity Score 2023 Business Index.
As Nebraska State Treasurer John Murante put it in his op-ed at Newsweek, this request comes on the heels of several instances where Chase appeared to engage in politically motivated discrimination.
In the past two years, Chase has denied payments or canceled accounts associated with people and organizations—such as former ambassador Sam Brownback, the Arkansas Family Council, Defense of Liberty, and retired general Michael Flynn, Jr—for holding mainstream American views.
In fact, a former Chase executive described the bank's practice of "red-dotting," where Chase employees can flag customers for cancelation based on their perceived reputational or social risk.
As we conveyed to Mr. Dimon, practices like "red-dotting" destroy trust between financial institutions and the customers they serve.
Treasurer Murante points out that the recent debanking of former U.S. Senator and Ambassador Sam Brownback’s nonprofit National Committee for Religious Freedom’s (NCRF) is a prime example of he and his colleagues’ concerns. Chase canceled NCRF’s account without warning, then, several weeks later, informed Ambassador Brownback’s team that it would only consider re-instating the account if NCRF disclosed its top donors and provided detailed information about the group’s planned political activities.
Ambassador Brownback and Viewpoint Diversity Score chief Jeremy Tedesco write about the situation at length in their recent piece at Newsweek.
As previously noted, Chase’s apparent participation in cancel culture through politicized debanking isn’t limited to NCRF. The financial officers’ letter recounts a 2021 incident in which Chase’s subsidiary WePay denied ticket payment processing services for a mainstream Republican event hosted by the nonprofit Defense of Liberty. In this case, Chase cited a policy that included vague and imprecise terms like “hate” and “racial intolerance,” which not only did not apply to the event, but also could easily be used again to justify cracking down on any other views that Chase decides it doesn’t like. And in the same year, Chase cancelled a credit card account connected to retired General Michael Flynn and also terminated the account of the Arkansas Family Council.
Banks like Chase betray public trust when they appear to deny their services based on religious or political affiliation. These actions stigmatize mainstream American views and push people who hold them to the margins. The financial officers’ request that Chase respond to the survey portion of the Viewpoint Diversity Score is a much-needed step towards the transparency necessary for restoring trust with shareholders, clients, and regulators.
And as Tedesco and Ambassador Brownback observe, banks risk severe consequences when they engage in viewpoint discrimination:
If companies don't voluntarily take steps to curb viewpoint discrimination in their services, they invite regulatory scrutiny. Some states are already considering legislation that would crack down on the debanking of ideologically disfavored industries, people, and groups. Large national banks receive wide-reaching government benefits, such as greater lending power, FDIC insurance rates, subsidies, bailouts, and an anticompetitive chartering system.
That banks receive these advantages courtesy of the government and taxpayers obliges them not to discriminate based on viewpoints in their services. And the danger that these benefits might be taken away gives financial institutions good reason to end their risky entanglement with one-sided social activism and cancel culture.
No one should worry about losing a bank account over speech. The financial officers signaled in their letter that they are willing to take action when companies like Chase overstep their bounds and trample on people’s First Amendment rights.
Chase must respect the free speech rights of their clients and shareholders or face continued scrutiny—and potential government accountability—for their actions.