Jamie Dimon in a navy blue suit and purple tie.” width=”970″ height=”647″ data-caption=’Jamie Dimon leaves the U.S. Capitol after a meeting with Republican members of the Senate Banking, Housing and Urban Affairs Committee on the issue of debanking on Feb. 13, 2025. <span class=”lazyload media-credit”>CQ-Roll Call, Inc via Getty Imag</span>’>
Lately, JPMorgan Chase (JPM) CEO Jamie Dimon has been very vocal about the need to reassess financial regulations. This message is resonating with Wall Street and Washington as Republican lawmakers look to reform post-2008 banking legislation to streamline federal agencies and promote government efficiency.
Last month, Dimon, along with the CEOs of Bank of America, Wells Fargo, U.S. Bancorp, PNC, Truist and Capital One, attended a roundtable meeting with Tim Scott, chairman of the Senate Banking Committee, to discuss a broad array of concerns, particularly “debanking”—the practice of a bank terminating an individual or business account. Republican lawmakers alleged major banks have been wrongfully terminating customers’ bank accounts due to their political views. Scott has characterized the phenomenon as “Operation Chokepoint 2.0, where federal regulators have exploited their power to pressure banks into cutting off services to individuals and businesses with conservative leanings,” he said during a Senate hearing a week before the roundtable.
The original Operation Chokepoint is a Department of Justice initiative from 2013 to 2017 under the Obama administration aimed at cracking down on banks doing business with high-risk industries prone to money laundering and fraud, such as arms dealers and payday lenders. Republican lawmakers have since labeled the Biden administration’s effort to combat digital asset scams and similar initiatives as “Operation Chokepoint 2.0,” arguing that these actions have led to the debanking of many legitimate customers.
Dimon said JPMorgan doesn’t debank customers for their religious or political views. But he acknowledged the need to review this regulation. “The AML [anti-money laundering]/FinCEN rules are extraordinary, and it does cause a lot of people to be pushed out of the system because banks are afraid of being sued or fined,” he told Bloomberg before the congressional roundtable. FinCEN refers to the U.S. Department of Treasury’s agency responsible for enforcing laws that ensure banks do not conduct business with illicit actors.
“Debanking is a credible issue,” Margaret Tahyar, head of the law firm Davis Polk’s financial institutions practice, who advised JPMorgan on its acquisition of First Republic in 2023 after the regional banking crisis, told Observer. She argues it is a result of anti-money laundering and fraud regulations, which have resulted in “weird incentives where supervisory staff push banks to be as risk-averse as possible.” Tahyar said the U.S. must enforce a money-laundering system that prohibits wrongful activity but avoids creating an overly cautious culture that results in the wrongful termination of innocent people’s accounts.
Dimon’s concerns extend to the broader financial regulatory system. “We have become a highly bureaucratic, litigious, over-regulated society, and it’s bad,” he told CNBC last month. “It’s not just waste and fraud, it’s outcomes. Why are we spending the money on these things? Are we getting what we deserve?” he questioned, alluding to the Elon Musk-led Department of Government Efficiency.
Reflecting this growing sentiment, President Trump appointed Russell Vought, his Director of the Office of Management and Budget, as interim director of the Consumer Financial Protection Bureau (CFPB), who halted the agency’s operations 36 hours after taking the reigns. The CFPB was created in 2011 as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act in the wake of the 2008 Financial Crisis.
Much of Wall Street sees the pause as temporary and expects a reformed, more streamlined version of the CFPB. “There will be a root-and-branch reform of the CFPB, rather than the deletion of the organization,” Tahyar said. She argues there is a serious need to reconsider how the federal government regulates the banking system, questioning, “Why do we have five sets of supervisory staff at the federal level? Can we be more efficient?”
