Resolution Calling on Congress to Address Debanking

Model Resolution

WHEREAS, President Donald J. Trump through his August 7, 2025 Executive Order, Guaranteeing Fair Banking for All Americans; and United States Senator Tim Scott, Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, through his legislation, the Financial Integrity and Regulation Management (FIRM) Act of 2025; and United State Senator John Kennedy, Chairman of the Economic Policy Subcommittee of the Banking, Housing, and Urban Affairs Committee through his legislation the STREAMLINE Act; and United States Representative French Hill, Chairman of the House Committee on Financial Services and the United States House of Representatives who approved a version of the FIRM Act on July 21, 2026 by a vote of 270—155; are working to stop federal regulators from leveraging their authority to pressure banks to debank individuals and businesses; and

WHEREAS, the complexity of federal laws and regulations and broad discretion of regulators have allowed federal regulators to weaponize banks for far too long; and

WHEREAS, banks are required by their regulators to manage risk, to know their customers, and to help detect and deter financial crimes, including money laundering, drug trafficking, human trafficking, and terrorism financing; and

WHEREAS, regulators require banks to file suspicious activity reports (SARs) if they suspect suspicious activity involving specific transactions and are prohibited from communicating this to customers; and

WHEREAS, if a regulator decides a bank is not adequately managing risk, does not have a good enough system in place to detect and deter financial crimes, or is closing accounts too slowly, the bank can face significant monetary penalties and costly lawsuits, and potentially criminal charges; and

WHEREAS, this regulatory environment allows regulators to put intense pressure on banks that can result in financial institutions managing risk by reevaluating or even severing their relationships with businesses and individuals to minimize regulatory risks and costs; and

WHEREAS, examples of regulators taking advantage of this leverage include: Operation Choke Point in 2013, where several high-ranking bureaucrats attempted to pressure banks to stop doing business with ammunition and gun sellers, payday lenders, and other industries and Operation Choke Point 2.0 in 2022, where the Federal Deposit Insurance Corporation (FDIC) sent letters to banks that called call for a “pause” on bank-crypto activity; and

WHEREAS, when federal regulatory agencies pressure banks to stop doing business with certain industries, it has a chilling effect that is ultimately a direct assault on free market capitalism, which has created the most prosperous nation in history, and

NOW, THEREFORE, BE IT RESOLVED BY THE SENATE AND THE HOUSE OF REPRESENTATIVES OF THE STATE OF [STATE NAME]: That the State Legislature and the Governor of [STATE NAME] urge [STATE NAME]’s members of the U.S. House of Representatives and U.S. Senators to modernize anti-money laundering (AML) laws to better focus banks and law enforcement on potential financial criminal activity rather than the innocent banking activity of law-abiding customers; and

BE IT FURTHER RESOLVED, that there be increased transparency and accountability for regulators and bank examiners to better balance legitimate concerns relating to AML while mitigating impacts to the ability of law-abiding citizens to access financial services; and

BE IT FURTHER RESOLVED, that the Secretary of State sends copies of this resolution to appointed officials leading the Federal Reserve, the Office of the Comptroller of the Currency, and the FDIC.