How Democrats ‘DeBanked’ Political Rivals in a Startling Assault on American Freedoms

President Biden has presided over nearly four years characterized by a dual justice system, evident through his pardon of Hunter Biden and the political targeting of then-candidate Donald Trump.

However, there are subtler assaults on justice, such as the practice of “debanking.” Many may not realize they could become targets simply for being a “politically exposed person,” meaning anyone who contradicts the liberal norm.

Debanking represents a form of financial ostracism that has emerged in the last two decades.

Initiated under former President Barack Obama, it served to penalize those identified as political adversaries, like gun manufacturers. Documents released in late 2020 revealed the federal government used its regulatory power over financial systems to undermine its political foes.

By using regulatory authority, government officials can effectively block certain individuals or businesses from making online transactions or obtaining a bank account and credit card.

Dr. Joseph Mercola, a vocal critic of the COVID vaccine, had his business accounts closed by JP Morgan Chase, a decision attributed to his opposition to the Food and Drug Administration.

In her recent memoir, Melania Trump noted that her bank account was terminated following the January 6, 2021 riots, and her son Barron was unable to establish his own account. She termed it “political discrimination.”

In today’s society, being shut out from electronic financial services can equate to economic ruin.

Regulators might argue they are not explicitly forbidding a private bank from engaging with a customer, insisting the bank has the autonomy to decide whom to serve.

Yet, the truth is markedly different due to the disproportionate influence wielded by the modern administrative state.

A bureaucrat can complicate someone’s existence to the point of coercion, effectively compelling compliance from individuals or institutions with actions the government is prohibited by law from undertaking.

This mirrors how the Biden administration pressured social media platforms to ban individuals questioning the official narrative regarding the COVID pandemic.

The trend of debanking under President Biden has severely impacted the cryptocurrency realm. The Securities and Exchange Commission has unleashed numerous investigations—some real, others mere threats—driving innovators and investors away.

Numerous tech and crypto founders have faced debanking under Biden, hindering their innovations.

During Joe Rogan‘s podcast, venture capitalist Marc Andreessen asserted that the Consumer Financial Protection Bureau, established at the urging of Sen. Elizabeth Warren (D-Mass.), particularly targets crypto firms.

“Almost every crypto founder or startup has either personally been debanked or had their company debanked,” Andreessen stated.

Andreessen also mentioned that others, such as Kanye West, have experienced debanking “for expressing incorrect politics. For making statements deemed unacceptable. Current banking regulations include a designation for politically exposed persons, or PEP. If one is categorized as a PEP, financial regulators mandate their removal from banking services.”

Scott Bessent, a nominee for Treasury Secretary by President-elect Donald Trump, has highlighted that many Democrats are on a campaign against crypto while attempting to distance themselves from the scandal surrounding FTX and Sam Bankman-Fried, the crypto fraudster who made substantial campaign contributions to Democratic politicians.

However, the issue transcends crypto or the tech industry. It is more significant than the Biden administration’s actions, which often utilize groups like the Southern Poverty Law Center to erroneously label any conservative organization as a “hate group.” Collaborating with a group accused of “hate” can expose a financial institution to regulatory scrutiny over perceived “reputational risk.”

What connection does this have to an individual’s ability to repay loans, a bank’s solvency, or the value of an individual’s assets? None. The radical left’s push to exclude individuals based on political beliefs is entirely political, not rooted in sound financial practices.

Anyone who values freedom and the rule of law should be thankful that the incoming president has signaled the end of unaccountable political coercion by bureaucrats.

E.J. Antoni is a public-finance economist and the Richard F. Aster fellow at the Heritage Foundation.