Trump called out Bank of America's CEO at Davos last year for closing conservative accounts.
The Fed's top banking regulator sat in front of the Senate Banking Committee and John Kennedy wants to know why.
And the grilling Kennedy gave her is exactly why Washington insiders hate cameras in that hearing room.
John Kennedy Demands Answers on Debanking Conservatives at Federal Reserve Hearing
"What in God's name was the Fed thinking when you allowed banks to debank customers for reputational risk?" John Kennedy demanded from Federal Reserve Vice Chair for Supervision Michelle Bowman during a Senate Banking Committee hearing.
"Because you didn't like their politics or you didn't like the products they made."
Bowman's answer was a classic Washington dodge: "I was not the vice chair at the time those decisions were made."
Kennedy was ready. "I know that but your institution went along with it. The banks proposed it and your institution sucked it up like a Hoover Deluxe."
How Obama's Operation Choke Point Gave Banks the Weapon They Used for Years
This goes back to Barack Obama.
His administration launched "Operation Chokepoint" – a coordinated scheme using the FDIC to pressure banks into cutting off gun dealers, ammo manufacturers, and other legal businesses the White House didn't like.
They called it "reputational risk."
Translation: we don't like your customers, so we're cutting off their money – quietly, without a law, without a court, and without a single vote in Congress.
A former FBI agent and past president of the American Bankers Association described it plainly: Operation Chokepoint had more in common with a purge of ideological enemies than a legitimate regulatory program.
Trump shut it down in his first term.
But the banks had already learned the trick and Biden's regulators spent four years teaching a new generation of bureaucrats the same playbook.
Melania Trump wrote in her memoir that she and Barron were personally debanked, though she didn't name the institution that closed their accounts.
Trump announced plans to sue JPMorgan Chase after the bank closed his accounts following January 6th – a $5 billion lawsuit still pending.
Anyone could be debanked for having the wrong politics.
Fed Moves to Kill Reputational Risk Rule That Made Debanking Possible
Days before the hearing, Bowman's Fed formally proposed to permanently strip "reputational risk" from bank supervision.
Gone.
The same legal weapon Obama built in 2011, the same tool Biden's regulators used to quietly strangle gun shops and conservative organizations – on its way out, codified out of existence.
Kennedy used Elizabeth Warren as his hypothetical – "How could you possibly allow a bank to debank someone like Senator Warren because you didn't like her politics?" – and the point landed hard.
If a Democrat senator lost her checking account, the Left would have burned Washington down.
When it happened to gun manufacturers, oil and gas companies, the First Lady, and her son – silence.
That gap tells you everything.
Obama built the weapon. Biden expanded it against crypto founders and conservative activists. Now the Fed under Trump is killing the tool that made it all possible.
The "reputational risk" loophole is gone.
Bank examiners can't make quiet phone calls flagging a customer as "problematic" anymore.
Operation Chokepoint is dead.
Kennedy's question wasn't really about Michelle Bowman.
It was about making every regulator in Washington understand, on the record, that the people who built this scheme and the people who used it have been seen – and this time, there are consequences.
Sources:
- Harold Hutchison, "John Kennedy Visibly Irked As He Grills Witness Over Why Agency Allowed Debanking Of Conservatives," Daily Caller News Foundation, February 26, 2026.
- Federal Reserve Board, "Following earlier actions to remove reputation risk from its supervision of banks, Federal Reserve Board requests comment on proposal to codify that removal," Press Release, February 23, 2026.
- Vice Chair for Supervision Michelle W. Bowman, Statement on Reputation Risk Proposal, Federal Reserve Board, February 23, 2026.
- "Scott Applauds Michelle Bowman's Confirmation as Federal Reserve Vice Chair for Supervision," Senate Banking Committee, June 4, 2025.
- William Barr, "Operation Choke Point reveals true injustices of Obama's Justice Department," The Hill, 2018.
- Melania Trump, Melania, memoir, 2024.
