Tag: banks

DOJ Probes JPMorgan, Bank of America, Over Political Account Closures

Federal subpoenas hit JPMorgan Chase, Bank of America, and Wells Fargo this week, ordering the banks to name every customer they cut off and to say why.

The legal fight is about fraud statutes and prosecutorial reach. A blunter question sits underneath it. When a bank shuts your account over your politics, where are you supposed to go?

The demands came from the US Attorney’s Office in Washington, D.C., run by Jeanine Pirro.

Her prosecutors asked the banks for lists of people who were “debanked” and for the reasons behind shutting them out. Some of the subpoenas reach back more than a year.

The investigation tests whether the account closures violated the Financial Institutions Reform, Recovery and Enforcement Act of 1989, a law built to chase bank fraud.

Debanking amounts to financial exile. A private institution decides your views, or your line of work, make you a liability, and your access to checking accounts, payroll, and credit can vanish.

There’s no hearing, no judge, and often no warning beyond a card that stops working. The power to do this sits with the bank, and the person on the other end rarely gets to argue back.

Last August, President Trump signed an executive order telling banking regulators to root out “politicized or unlawful debanking” and to penalize it. The Office of the Comptroller of the Currency later reviewed the nine largest banks and reported it had found early signs of the practice. Pirro’s office went further on its own, opening the criminal probe without waiting for a referral from those regulators.

The banks’ defense is the one you’d expect. They say they shut accounts only over legal, regulatory, or financial risk, never over belief. That explanation is convenient and hard to check because the standards live inside the banks and the people affected almost never see them. When the threshold for losing your account is “risk” defined by the institution that benefits from defining it loosely, almost any disfavored customer can be folded in.

For the crypto industry, the probe puts a name to a years-old grievance. Digital-asset firms watched their accounts close across 2022 and 2023 and called it “Operation Chokepoint 2.0,” a nod to a 2013 Obama-era program that pushed banks to drop industries the government disliked. The pattern repeats because the method works. You don’t have to outlaw an activity if you can cut off the money that keeps it alive.

That is the chilling effect in its purest form. People and businesses learn that the wrong affiliation can cost them a bank account, so they grow careful about what they say, fund, or build. The punishment never needs a courtroom to land, and it teaches everyone watching to keep their heads down.

JPMorgan, Bank of America, and Wells Fargo have mostly declined to comment on the subpoenas. JPMorgan has disclosed that it faces “reviews, investigations and legal proceedings” tied to the executive order.

The records Pirro wants would show, customer by customer, who the banks decided to drop and why. People shut out of the financial system for their views have spent years being told it never happened.

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Are Banks More Powerful Than Governments?

Government is big. Elected and unelected officials wield enormous amounts of power. But lately I have found myself wondering whether we are paying attention to the wrong institution.

What if the most powerful institutions in America are not governments at all?

What if they are banks and payment processors?

A few years ago, during COVID-19, a friend of mine owned a small shop in Northern California. It was the kind of place many young mothers loved. They sold raw milk, organic cotton sheets, natural baby products, books, toys, and healthy foods. It felt like an old-fashioned mercantile reimagined for modern families.

One day, she made a comment on social media praising CBD. I do not remember the exact wording, but it was something along the lines of, “Of course, we can raise children without CBD, but why would we want to?”

Whether you think CBD is wonderful or terrible is beside the point. The issue is not whether she was right. The issue is whether she had the right to say it.

Not long afterward, her credit card processing company terminated her account.

The company processing her payments had nothing to do with the social media platform where she made the comment. Yet somehow, a statement made on one platform became a problem for an entirely different company that controlled her ability to process payments.

The fallout was immediate. Roughly $30,000 was frozen. She struggled to make payroll. Because the company handled other operational functions as well, portions of her business became difficult to run. It took months of legal back and forth before she finally regained access to her own money.

When this happened, I called my own credit card processing representative. Before I could even finish explaining the situation, he knew exactly what I was talking about.

He told me he had been flooded with calls from businesses looking to switch processors because similar things were happening across the country. Businesses were scrambling to regain access to money they believed was theirs.

It was part of a broader pattern that many people have already forgotten.

During COVID-19, I lost count of the number of conferences, organizations, and educational programs that suddenly found themselves unable to process payments or fundraising. Then came the Canadian trucker protests. Regardless of where someone stood politically, a lot of people suddenly realized that modern power does not always arrive wearing a government uniform. Sometimes it arrives as an email informing you that access to financial services has been suspended.

What concerns me is that all of this happened before we have even become a truly cashless society.

Last weekend, I was in Austin speaking at an event for the Brownstone Institute. As I walked around the city, I noticed a surprising number of businesses no longer accepted cash.

The answers were remarkably consistent. Cash creates more work. Cash can be stolen. Cash requires counting. Cash requires bank deposits. Cash slows things down. Cash creates security concerns for employees.

These are all legitimate concerns. In fact, I understand them better than most people because I have lived them.

My brother owns restaurants in California and has chosen to operate cashless businesses. His reasoning is efficiency. Most business owners making these decisions are trying to reduce theft, simplify accounting, and protect employees. The incentives are understandable.

That is what makes this conversation so interesting.

Rarely do we lose freedom because someone announces they are taking it away. More often, we surrender small pieces of it because convenience, safety, and efficiency seem like fair trade-offs in the moment.

I found myself standing in one Austin business that displayed signs supporting inclusion, immigrant rights, and various social justice causes. I asked the young man behind the counter a simple question.

“If we are concerned about making society accessible to everyone, why require a bank account, a smartphone, a QR code, and a digital payment platform just to buy a cup of coffee?”

He looked genuinely surprised.

After thinking about it for a moment, he said, “Maybe you’re right.”

What struck me was not his answer. It was that the question had never occurred to him.

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‘This Has to Be Stopped’: Alarm As Trump’s Crypto Firm Set to Get Federal Banking Privileges

Critics expressed alarm on Tuesday amid a new report suggesting that President Donald Trump’s cryptocurrency firm is about to get federal banking privileges.

As reported by NOTUS, the Office of the Comptroller of the Currency (OCC) in the coming weeks is expected to approve a national trust bank charter for World Liberty Financial, the crypto startup founded by members of the Trump family and the family of Trump Middle East envoy Steve Witkoff.

Were it to receive the charter, NOTUS explained, World Liberty Financial would receive “significant legal and financial benefits,” including being able “to settle financial transactions akin to Venmo or PayPal on the World Liberty Financial platform, through which the Trump family could receive a cut.”

David Wachsman, a spokesperson for World Liberty Financial, dismissed concerns about conflicts of interest, telling NOTUS that “none of [the company’s] leadership or employees work for the US government,” even though the president and his entire family stand to personally benefit from the charter’s approval.

Corey Frayer, director of investor protection for Consumer Federation of America, told NOTUS that here was simply no precedent for a sitting president being granted such privileges for a company he founded by a comptroller whom he personally appointed.

“For the first time in history, a president is leaning on a bank regulator to give his private enterprise the implicit backing of the federal government,” Frayer explained. “It’s outrageous.”

Diana Henriques, a veteran financial journalist best known for her extensive coverage of the Ponzi scheme run by disgraced financier Bernie Madoff, also expressed horror at the prospect of the OCC carrying out the president’s bidding.

“The guardrails continue to fall,” Henriques wrote. “It is functionally impossible to regulate a bank owned by the president. Yet it can imperil the entire banking system if it runs off the rails. For heaven’s sake, this has to be stopped.”

Derek Martin, vice president at Focal Point Strategy Group, wrote that there is “no other way to interpret” the NOTUS report “than Trump using the government to advance his own firm’s interests.”

“World Liberty Financial’s entire brand—and reason for existence, basically—is ‘We are affiliated with Trump,’” Martin added. “This is just the latest way they’re leveraging it.”

Government watchdogs for months have been raising alarms about the president having his own cryptocurrency firm, which has received massive investments from foreign governments since its founding in 2024.

According to NOTUS reporter Jeff Stein, Trump has reported personally earning $57 million from World Liberty Financial so far, a number that could get significantly higher if the firm is granted its charter.

An analysis published by Forbes last month estimated that Trump has nearly tripled his wealth since returning to office, going from a net worth of $2.3 billion in 2024 to $6.5 billion in 2026.

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Russia Tells Banks to “Shoot Down Drones Yourself”

The line between civilian society and war is disappearing completely. That is the real story behind Russia now authorizing its central bank and Sberbank to operate anti-drone systems and arm personnel to defend financial infrastructure. A country’s banking system is no longer simply processing transactions or moving money. It is now becoming part of the battlefield itself.

Russia passed a new law allowing the central bank, Sberbank, and the Russian Cash Collection Association to deploy their own drone defense systems after repeated Ukrainian strikes deep inside Russian territory. Staff at these institutions can now reportedly be armed as well.

This is what happens when modern war evolves into economic warfare. I have warned repeatedly that World War III would not resemble World War II where armies simply lined up across borders. The entire economy becomes militarized. Banks, energy grids, payment systems, telecommunications, ports, railways, factories, and data centers all become targets because modern civilization itself depends on interconnected infrastructure.

Ukraine understands this perfectly. Their drone strategy has increasingly focused on striking oil facilities, energy infrastructure, logistics centers, and economic targets deep inside Russia because they know they cannot defeat Russia conventionally in a prolonged war of attrition.

What is extraordinary here is not merely the drone attacks themselves. It is the admission that the Russian state can no longer centrally defend everything. Moscow is effectively decentralizing air defense responsibilities and telling major corporations and financial institutions: defend yourselves. That is a major shift psychologically.

The Guardian even framed it bluntly: Russia is telling its banks to “shoot down drones yourself.”

This is precisely how long wars transform societies historically. Civilian infrastructure slowly merges with military infrastructure until there is barely any distinction left. During the later stages of major conflicts, factories become military targets, railroads become military targets, ports become military targets, and eventually financial institutions themselves become military targets because war is ultimately about resources and economic survival.

Sberbank is not some small regional bank. It is effectively intertwined with the Russian state itself. Sberbank controls roughly a third of Russian banking assets and acts as a pillar of the entire domestic financial system. The Russian central bank likewise sits at the core of wartime financing, sanctions management, currency stabilization, and capital controls.

Russia has pushed aggressively toward cashless payments, digital financial infrastructure, and central bank digital currency experimentation through the digital ruble system. But centralized digital systems become vulnerable during wartime because they create concentrated targets.

The more governments centralize financial systems digitally, the more vulnerable those systems become to cyberwarfare, EMP threats, sabotage, drone attacks, and infrastructure strikes. This is one reason governments are quietly preparing for a wartime financial environment globally.

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Trump’s Iran War Slowing Global Economic Growth to Lowest Level Since Pandemic: World Bank

The World Bank on Thursday lowered its global growth forecast for the remainder of 2026 as the illegal US-Israeli war of choice on Iran drives up energy prices, inflation, and the cost of debt.

“The global economy is facing another major shock,” the World Bank’s latest biannual Global Economic Prospects report states. “The conflict in the Middle East has triggered sharp increases in energy prices, renewed inflationary pressures, and fueled expectations of tighter monetary policy.”

“Global growth is projected to slow to 2.5% in 2026, from 2.9% in 2025 – the lowest rate since the Covid-19 pandemic – amid weaker prospects for economies dependent on energy imports and those directly affected by hostilities,” the report continues. “Activity is expected to firm in 2027-28 as energy supplies recover, monetary easing resumes, and trade strengthens.”

The Iran War has resulted in the closure of the Strait of Hormuz, through which around 30% of the world’s fertilizer and 20% of its oil previously passed. In addition to increasing the risk of a global food crisis, the strait’s closure has sent fuel and fertilizer prices soaring, with US farm diesel costing nearly 50% more than it did on the war’s eve in February and various fertilizer products spiking by between one-quarter and one-half.

The war has affected the economies of countries far removed from Iran, as the World Bank reports forecasts that “growth in emerging market and developing economies (EMDEs) is expected to slow to 3.6% this year.”

“The level of per capita income across EMDEs excluding China and India, relative to advanced economies, is not expected to return to the pre-pandemic level until after 2028, implying nearly a decade of lost income convergence,” the international financial institution predicted.

World Bank Group president Ajay Banga said in a statement Thursday that “developing countries have faced a series of challenges over the last decade.”

“The impact differs by country, but the basic test is the same: Protect people and preserve stability today, without giving up on growth and jobs tomorrow,” Banga added. “In response to the current shock, we are providing liquidity where it is needed now – and we are ready with additional financing, guarantees, and private-sector solutions if pressures deepen. Our job is to help countries steady the ship, keep reforms moving, and emerge stronger on the other side.”

The bank said in April that up to $100 billion would be made available over the next 15 months for nations suffering the most acute economic shocks caused by the war.

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Lawful Permanent Resident From India Living in Upscale Corona del Mar BUSTED for Defrauding Bank of Nearly $100 MILLION – Forged Title Policies in Adobe, Altered Metadata, and Lied to Lenders!

Mahender Makhijani, 44, a lawful permanent resident from India residing in the upscale enclave of Corona del Mar, was arrested this morning on a federal criminal complaint charging him with bank fraud.

Makhijani controlled Cantor Group V LLC, a Newport Beach-based outfit that had a lending deal with a federally insured bank. Under the agreement, the bank advanced nearly $100 million so Cantor could originate or purchase real estate loans, but only first-lien loans where Cantor held the top position on the collateral.

Instead of playing straight, Makhijani and a subordinate spent months from September 2024 through April 2025 systematically falsifying title insurance policies.

They used Adobe software to doctor the documents, making it appear Cantor held first-lien positions when other creditors were actually ahead in line. They altered or stripped metadata — including by printing out the fakes and rescanning them — then submitted the bogus records to the bank.

Makhijani didn’t stop there. He personally joined teleconferences with bank reps and fed them misleading explanations. In December 2024, he caused a spreadsheet full of false information to be sent over.

The bank relied on these lies when deciding to keep advancing funds. Had the truth come out earlier, the bank would have declared Cantor in default and demanded immediate repayment of the full $100 million.

If convicted, Makhijani faces a statutory maximum of 30 years in federal prison.

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Sam Altman Pushes Plan For Backdoor Government Backstop By Handing Out Small Equity Stake To Americans

Back in November, amid mounting speculation that OpenAI’s massive cash burn was massively unsustainable in light of the $1.4 trillion of funding commitments by the AI company, which in turn has sparked the biggest capex flood in modern history all on the hope that the company’s promised payments will be made good, OpenAI CFO Sarah Friar sparked a market selloff when amid an admission that OpenAI was “looking for an ecosystem of banks [and] private equity” to support its ambitious plans, she explicitly said that the US government would have to “backstop the guarantee that allows the financing to happen.” 

In other words, as we explained at the time, when all the other sources of funds dried up – clearly a scenario the company is considering judging by her response – the company would have to come to the US taxpayer.

Friar further explained that “Federal loan guarantees would really drop the cost of the financing,” enabling OpenAI and its investors to borrow more money at lower rates to meet the company’s ambitious targets. Right… because there is nothing like a company with $14BN in revenue, $1 trillion in “valuation” and $1.4 trillion in commitments, than loading up to the gills with government-backstopped debt… if only Enron and Lehman had thought to do the same, both would still be around.

Anyway, after the market vividly demonstrated it was less than enthused by this proposal, sending shares in the AI sector sharply lower as it signaled OpenAI itself doubted it would have the financial wherewithal to meet its obligations, the company promptly shelved any discussion of a taxpayer bailout backstop Federal loan guarantee, and even prompted a rare tweet from Sam Altman to explain why Sarah didn’t really mean the things she said. 

All that changed late last week, when Donald Trump caught much of the AI industry by surprise when he threw his weight behind a radical proposal for companies such as OpenAI to hand equity stakes to the American people.

Elements of the idea, which had started as a fringe argument on the progressive left, have recently drawn support from an unlikely cast of characters including Trump cabinet members, democratic socialists such as Bernie Sanders and Maga populists such as Steve Bannon.

But the concept suddenly gained more traction in the White House when – six months after OpenAI first flirted with the idea of a backstop – OpenAI chief executive Sam Altman visited Capitol Hill this week.

According to the FT, the plan proposed by his company, alongside others, would involve setting up a sovereign-wealth-style fund into which AI companies would contribute equity so the American public can share in the lossmaking sector’s soaring valuations. What was left unsaid is that while the “American public” would share in the soaring valuations, they would also share in the AI sector’s continued losses and, more importantly, would be on the hook for the hundreds of billions in commitments if OpenAI is unable to fund them.

Translation: OpenAI – which reportedly is worth just shy of $1 trillion on pre-IPO paper, is once again seeking a government bailout, pardon, backstop. 

Such a plan would be distinct from the $9bn stake the Trump administration took in chipmaker Intel last year, as the public would own shares individually, rather than the US government directly owning equity, according to a person with knowledge of OpenAI’s plans.

In response to a question about equity stakes on Air Force One on Friday, Trump suggested “pieces [of AI companies] could be given to the American public” in an effort to quell the growing alarm around the rapid rollout of the technology. As if the American public can somehow sell its shares of OpenAI to offset soaring electricity prices. 

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Treasury Dept. asks banks to look for signs of illegal immigrant labor

The Treasury Department on Friday issued an advisory that financial institutions, including banks and casinos, to “be vigilant” against signs of unlawful employment of illegal immigrants.

The Department’s Financial Crimes Enforcement Network, called FinCEN, in the advisory calls on the institutions employ methods to detect schemes covering up the employment of people who are not authorized to work in the United States.

Treasury Secretary Scott Bessent said in a FinCEN press release that part of the Trump administration’s crackdown on illegal immigration includes “securing our financial system.”

“This administration will not allow illegal aliens to abuse financial institutions to steal billions of dollars from hardworking American taxpayers,” Bessent said.

In order for non-immigrants to work in the United States, employers are required to petition with U.S. Citizenship and Immigration Services for eligibility, before a prospective employee either applies to the State Department for a visa or enters the country through a port of entry, according to USCIS.

FinCEN said in the release that the hiring, concealing and exploiting of workers without visas can give employers advantages over other businesses, depress wages, facilitate identity theft and steal tax revenue from the United States.

The agencies additionally said that the hiring of these workers can also help fund and assist criminal enterprises that include drug trafficking and human trafficking.

The financial institutions are being asked to watch out for red flags of shell companies, identity theft, fraudulently used social security and worker identification numbers, shell companies and a raft of other detectable signs of fraud.

In addition to depository institutions such as banks, credit unions, money services businesses and securities and futures firms, FinCEN has aimed the advisory at casinos, the insurance industry, mortgage companies and brokers, and the precious metals and jewelry industries.

The Treasury Department said that more than $2.5 billion in suspicious activity reported by financial institutions was linked to payroll fraud schemes in 2025 alone, noting one multi-year scheme that cost the United States more than $38 million in tax revenue.

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Swiss Bank Accounts are DEAD – The New Banking Hub

For decades, Switzerland sold one thing better than perhaps any country on earth: privacy. That became its true export. People think of watches, chocolate, pharmaceuticals, or skiing resorts, but Switzerland’s real business was protecting capital from governments. That was the foundation of modern offshore banking.

Switzerland has destroyed the very industry that made it rich. Hong Kong has officially overtaken Switzerland as the world’s largest offshore wealth hub, managing roughly $2.95 trillion in cross-border wealth compared to Switzerland’s $2.94 trillion, according to the latest Boston Consulting Group report.

This was entirely self-inflicted. I warned years ago that Switzerland was committing financial suicide by surrendering banking secrecy under pressure from Washington, Brussels, the OECD, and the global tax authorities. Once Switzerland agreed to automatic information exchange treaties and effectively transformed Swiss bankers into tax informants for foreign governments, they destroyed the very reason international capital flowed there in the first place.

Offshore banking was never simply about taxes. It was about protection from political instability, confiscation, currency collapse, revolution, war, and predatory governments. Switzerland became wealthy because it remained neutral and outside the endless political insanity consuming Europe.

But after 2008, the entire Western financial system changed. FATCA turned foreign banks into enforcement agents for the IRS. CRS reporting standards spread globally. European politicians demonized offshore banking because governments drowning in debt cannot tolerate wealth escaping their reach. Suddenly, confidentiality itself became suspicious.

The politicians pretended this was about “fairness” and fighting tax evasion. Nonsense. This was about governments hunting capital because sovereign debt is spiraling out of control worldwide. Europe is collapsing economically under regulation, welfare spending, energy costs, migration pressures, and war expenditures. Once governments cannot sustain themselves honestly, they begin searching for private pools of wealth to confiscate.

Switzerland surrendered to that pressure completely. The famous Swiss numbered account became little more than mythology. Automatic reporting agreements gutted the entire purpose of Swiss banking secrecy. Once confidentiality disappeared, wealthy clients naturally began looking elsewhere.

That is where Hong Kong entered the picture. Hong Kong operates under an entirely different mentality. While Switzerland spent years apologizing to foreign governments and dismantling privacy protections, Hong Kong positioned itself as the gateway between Chinese wealth and global markets.

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The Devil Neither Political Party Will Name

The widening wealth inequality gap is the political third rail nobody in power truly ever wants to touch.

Politicians will scream at each other all day over taxes, healthcare, immigration, tariffs, student loans, climate policy, or whatever outrage is currently driving engagement on cable news and social media. But the second the conversation turns toward monetary policy, toward the machinery of money creation itself, the room suddenly gets very quiet.

That’s because monetary policy has quietly become the single most powerful force reshaping wealth distribution in modern America. And unlike the endless partisan theater surrounding fiscal policy, monetary intervention oddly enjoys remarkable bipartisan support.

Republicans and Democrats may pretend to be existential enemies on television, but when it comes to flooding the financial system with dollars, both parties reliably fall into line. And that support is precisely why this topic is politically radioactive: once people understand how the system works, the illusion of two competing economic ideologies starts to collapse. Republicans want less spending, Democrats want higher taxes…but both parties want the Fed to keep printing dollars.

Since the early 2000s, and especially after 2008 and the COVID era, America has effectively entered a permanent regime of monetary intervention. Quantitative easing, near-zero interest rates, endless debt monetization, emergency lending facilities, and the mainstream acceptance of Modern Monetary Theory-adjacent thinking have fundamentally altered the structure of markets beyond recognition.

When Ben Bernanke first rolled out quantitative easing during the 2008 financial crisis, Americans were repeatedly assured it was a temporary emergency measure. Bernanke described the programs as targeted interventions designed to stabilize markets and support recovery, not permanently redefine the financial system.

QE1 was supposed to calm panic. Then came QE2. Then Operation Twist. Then QE3 became effectively open-ended, with the Fed purchasing tens of billions in bonds every month indefinitely. What began as a supposedly temporary crisis tool metastasized into a permanent feature of the modern economy. And every subsequent crisis only justified bigger interventions: larger balance sheets, lower rates, more liquidity, more market dependence on central bank support.

The Federal Reserve’s balance sheet exploded from under $1 trillion before 2008 to nearly $9 trillion after the pandemic era. Like nearly every government “emergency” program in history, the temporary measure never truly disappeared, it simply normalized, expanded, and embedded itself deeper into the system. It culminated in Neel Kashkari taking to national television to let the world know the Fed has “infinite” cash.

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