US OCC: JPMorgan, Citigroup, and seven other major banks suppress the crypto industry, will continue to pursue legal action

U.S. Office of the Comptroller of the Currency (OCC) released an investigation report this morning on 12/11. From 2020 to 2023, nine major U.S. banks took measures to suspend or restrict financial services to multiple politically controversial industries, including the cryptocurrency industry. OCC pointed out that some banks still differentiate between legitimate and compliant industries, requiring additional reviews or directly restricting transactions, involving unreasonable discrimination. They will hold these behaviors accountable in the future and ensure illegal account suspensions do not continue.

Banks raise service thresholds for specific industries; OCC accuses unreasonable discrimination

OCC indicated that between 2020 and 2023, several major U.S. banks increased the thresholds for opening accounts and providing financial services, or outright refused transactions, citing clients engaged in “legitimate but politically controversial businesses.”

OCC concluded that these practices are not only unreasonable but also involve discrimination, as banks’ responsibilities should be based on risk rather than the political sensitivity of industries. The investigation was initiated following an executive order signed by President Trump in August this year, requiring a review of whether banks suspended accounts due to clients’ political, religious, or other non-risk factors. OCC’s investigation is conducted under this executive order.

(The Wall Street Journal: Trump intends to sign executive order to stop Chokepoint 2.0, supporting the crypto industry from banking discrimination)

Crypto industry also affected; multiple controversial industries are similarly impacted

OCC further clarified that the industries restricted by banks are not limited to the cryptocurrency sector. The report states that oil and natural gas exploration, coal mining, firearm-related industries, private prisons, tobacco and e-cigarette manufacturers, and adult entertainment businesses are all on the restriction list.

Regarding the crypto industry, OCC stated that banks not only restrict crypto issuers but also apply the same attitude toward exchanges and management platforms. Banks typically justify these restrictions as “preventing financial crimes” or “compliance risk assessments,” thereby raising the thresholds for related companies to access financial services.

OCC Director Jonathan Gould expressed regret, believing it is inappropriate for the largest banks in the U.S. to use their licenses and market power to enforce these suspension policies.

(U.S. OCC: Fully ending de-banking and reputation risk, assisting the development of crypto banking)

Nine major banks are the subjects of the investigation and will continue to be pursued under the law

The OCC investigated nine of the largest commercial banks in the U.S.:

JPMorgan Chase

Bank of America

Citibank

Wells Fargo

U.S. Bank

Capital One

PNC Bank

TD Bank

BMO Bank

These banks are among the most influential institutions in the U.S. financial system, so the investigation has attracted significant attention. OCC stated that the investigation is still ongoing, with more evidence being collected and pursued according to law.

(Strike CEO’s account was closed by JPMorgan Chase; U.S. Senator warns that Chokepoint 2.0 may re-emerge)

OCC report still has gaps, not covering other sources of regulatory pressure

Nick Anthony, policy analyst at the Cato Institute, one of the five major U.S. think tanks, commented that the report still leaves many aspects to be supplemented. He pointed out that while the report criticizes banks for severing controversial clients, it does not mention that regulatory agencies themselves require banks to assess “reputation risk,” which could be one of the reasons behind their actions.

He also noted that the report mentions banks restricting crypto services but omits that the “Federal Deposit Insurance Corporation” (FDIC) has explicitly warned banks to avoid dealing with crypto companies. Additionally, Republican Chairman French Hill of the House Financial Services Committee previously stated that the FDIC’s “suspension letters” sent during the Biden administration caused banks to distance themselves further from crypto firms, intensifying the so-called “crypto account suspensions.”

The true sources of pressure are the FDIC and the Federal Reserve, not the OCC

Caitlin Long, founder of the crypto-friendly bank Custodia Bank, also shared her views on the report. She believes that during the Biden administration, the entities most aggressively suspending crypto accounts were not OCC but the FDIC and the Federal Reserve (Fed).

She stated that OCC’s report only targets large banks, but the greatest pressure on the crypto industry in the past was exerted covertly by the FDIC and the Federal Reserve on small and medium-sized banks, causing them to steer clear of crypto-related businesses.

(JPMorgan Chase Dimon: Current regulations force banks to suspend accounts, not political or religious reasons)

This article, U.S. OCC: JPMorgan Chase, Citibank, and other nine major banks suppress the crypto industry, will continue to pursue lawfully, originally appeared on Chain News ABMedia.