Capital One Closed Trump Org Accounts Over $$ Laundering Concerns

Aug 10

NEWS & RESEARCH

Capital One closed approximately 385 bank accounts belonging to the Trump Organization in 2021, later citing "money laundering" concerns as the reason. In 2025, the Trump Organization filed a lawsuit against the financial institution, claiming that the decision was politically motivated retaliation for the January 6 riot. However, Capital One has asked a federal judge to permanently dismiss the case, explaining that the closures came after "months of analysis and a careful review" by its financial-crimes team, triggered by worrisome "transaction patterns" on the accounts. Capital One's statements mark the first time that a bank has formally tied money laundering concerns to Trump and his family business—though according to 2019 news reports, anti-money-laundering staff at Deutsche Bank had also flagged suspicious activity on Trump-related accounts. (Deutsche Bank denied the reports.) Now, Trump is leading a crusade against "debanking"—an umbrella term for banks cutting off a customer. Trump and his allies claim banks are using it to discriminate against conservatives.

SOURCES: NPR | CNN | CBS | Reuters | The Guardian

ANALYSIS & OPINION

An earlier version of this lawsuit was already dismissed in court, with the judge calling the Trump Organization's complaint "deficient." Trump and his lawyers then refiled, but many believe their arguments are still baseless, as Capital One's contract explicitly gives the bank the right to close the accounts "at any time." And although the bank did close Trump's accounts shortly after the Jan. 6 riot, the timing makes sense—just months before the closures, Capital One had been forced to pay a $390 million civil penalty for violating the Bank Secrecy Act by failing to report other suspicious activity. It's logical that the bank would then tighten its anti-money-laundering procedures and drop customers it deemed risky. Indeed, as the Bank Policy Institute states, examiners generally expect accounts to be closed after multiple suspicious activity reports have been filed for a single customer—and banks face steep penalties for failing to terminate such relationships. Interestingly, though, there's also a parallel suit against JPMorgan Chase, which the Trump Organization sued in 2026 for the same reason, over account closures that also took place in 2021. In a statement, the bank said, "Our company does not close accounts for political or religious reasons. We do close accounts because they create legal or regulatory risk for the company." There could also be hints of retaliation in the suits. the Trump Organization filed against JPMorgan Chase just days after the bank's CEO, Jamie Dimon, publicly criticized the president's policies. And this is not Capital One's first run-in with Trump, either—in 2019, Trump sued the bank to prevent it from sharing his financial records with Congress.

SOURCES: MS NOW | NPR | AP | The Hill | CBS | TheStreet

HOW TO FIX IT

Federal action:

Undo the "debanking" executive order. In August 2025, Trump signed Executive Order 14331, "Guaranteeing Fair Banking for All Americans," which directs bank regulators to punish banks that close accounts for supposedly political reasons. In practice, it pressures banks to keep risky customers, like Trump's own businesses, or face fines and disciplinary measures. Congress can't repeal an executive order directly, but it can defund its enforcement, override it by passing a law, or strike down the specific rules regulators issue under it. Separately, a future president can revoke the order outright.
Protect banks that close suspicious accounts. Federal law (31 US Code § 5318) already shields banks from being sued for reporting suspicious activity to the government (a protection known as the ‘safe harbor’). But it doesn't clearly cover the next step—closing the account—which is exactly the gap Trump's lawsuits exploit. Congress could extend the safe harbor so that banks can't be sued for ending a customer relationship as part of anti-money-laundering compliance. That would make suits like this one dead on arrival.
Pass the Presidential Conflicts of Interest Accountability Act, which would force presidents to sell off their business interests and put the money in a "blind trust"—an account managed by an independent person the president can't see or direct. This law would prevent similar situations from happening in the future: no businesses, no accounts to close, no conflict. However, the Act should be amended to define “relatives” broadly to include adult children, siblings, and in-laws, as the proposed bipartisan Presidential Ethics Reform Act of 2024 did, because Trump’s sons controlled many of the 385 accounts that Capital One closed.
Make money laundering harder for businesses like the Trump Organization:
Adequately fund the financial-crimes police. The Financial Crimes Enforcement Network (FinCEN) is the Treasury Department agency that serves as the government's financial-crimes watchdog: When a bank spots suspicious money movement, it's required to file a "suspicious activity report" with FinCEN, which is supposed to analyze the reports and route them to law enforcement. In practice, banks file millions of these reports a year, but FinCEN is chronically understaffed and most are never investigated.
Revive the all-cash real estate rule. Anonymous, all-cash property purchases are a classic way to launder money—and roughly 70% of Trump property sales after his 2016 nomination went to anonymous shell companies, mostly in cash. A FinCEN rule requiring the true buyer to be identified in these deals took effect in March 2026—but only after the administration delayed it, and just weeks later a federal court struck it down, leaving it unenforceable. Notably, the court didn't rule the policy unconstitutional—it ruled that the agency overstepped the authority Congress gave it. Congress could fix that by writing the requirement directly into law.
Amend the Corporate Transparency Act (CTA). Since money laundering runs on anonymous LLCs, Congress passed the CTA in 2021 to require companies to disclose their true owners to the government. However, the law allows the Treasury Secretary to issue exemptions at his or her discretion. In 2025, the Trump administration used that loophole to exempt more than 99% of covered companies. A bipartisan pair of senators has urged the Treasury to scrap the exemption, but Congress could go further and rewrite the law to strip this power entirely—a change with direct consequences for the Trump Organization, since it has long been tied to shell companies.

State action:

Repeal state "anti-debanking" laws. Several red states have passed laws punishing banks for closing accounts. Florida—where the Trump Organization filed this suit—passed one in 2023 and expanded it in 2024, declaring it an "unsafe and unsound practice" for banks to deny or cancel services based on a customer's political or religious views, and requiring banks to attest compliance every year under penalty of perjury. However, Treasury officials and members of Congress have warned that these laws conflict with federal anti-money-laundering rules, which can require banks to drop suspicious customers. Laws like Florida's give customers who face account closures a ready-made legal weapon to contest the decision.

Litigation:

Capital One could ask the judge to invoke Rule 11 to make Trump's side pay the bank's legal fees for wasting the court's time, as the financial institution says the refiled complaint "suffers from the same fundamental flaws" as its earlier versions. This would not be the first time Trump was forced to pay for a baseless case—in 2023, he w a s fined nearly $1 million over a meritless suit against Hillary Clinton.

Legislation: H.R.7207 - Presidential Conflicts of Interest Accountability Act | H.R. 8489 - Presidential Ethics Reform Act | H.R.2513 - Corporate Transparency Act