#RacistBanksMustFall movement: A call for legislative action in SA

Debanking, due to ‘reputational risk, violates the SA constitution

- PHILIPPA LARKIN AND SIPHELELE DLUDLA.

THE #RacistBanksMustFall movement in South Africa has called for immediate legislative intervention in the wake of a US executive order designed to prevent banks from closing accounts based on political or religious beliefs.

#RacistBanksMustFall, applauded the recent move by US President Donald Trump to combat debanking practices, urging South Africa to follow suit and introduce similar protections for its citizens.

The Trump administration's executive order, expected to be signed this week, aims to tackle the controversial practice of debanking, where financial institutions deny services to individuals or businesses based on political affiliation. The order directs federal banking regulators to remove vague “reputational risk” guidelines that have often been used to justify account closures, particularly targeting conservative and crypto industry figures in the US.

Debanking is an umbrella term for when abank rejects a customer, which can happen for any number of reasons. Americans don't have a legal right to a bank account, and lenders often turn away people or businesses to comply with a mountain of rules and regulations designed to protect the financial system. Reuters reported Trump as saying he believes that banks, including JPMorgan and Bank of America discriminate against him and his supporters.

Trump also said the country’s top two lenders had previously rejected his deposits, ramping up his attack on the industry.

“They totally discriminate against, I think, me maybe even more, but they discriminate against many conservatives,’ he told CNBC in an interview.

“They did discriminate,” Trump said of actions taken by JPMorgan after his first term in office. “I had hundreds of millions, I had many, many accounts loaded up with cash ... and they told me, I'm sorry sir, we can't have you. You have 20 days to get out.”