Trump administration considers executive order on 'debanking': WSJ

Trump administration considers executive order on 'debanking': WSJ

The Trump administration is reportedly considering an executive order aimed at addressing the issue of "debanking," a term used to describe the process by which financial institutions close accounts or limit services for individuals or entities deemed high-risk or controversial. The potential executive order, which has not yet been formally announced, is said to be part of a broader effort to enhance national security and combat perceived threats to the financial system.

According to sources close to the administration, the executive order would give federal regulators the authority to order banks to close accounts or limit services for individuals or entities associated with certain activities, such as pro-Palestinian activism or cybersecurity-related concerns. The move is seen as a response to the recent release of Columbia University activist Mahmoud Khalil, who was held in immigration detention for his pro-Palestinian advocacy [2].

The executive order would also reportedly include provisions to strengthen cybersecurity measures, reversing some of the cybersecurity directives put in place by the Biden administration. This includes scrapping requirements for secure software development frameworks and quantum-resistant encryption, as well as directives for federal agencies to adopt these measures [1].

The proposed executive order has sparked concerns among cybersecurity experts and proponents of open financial systems. Jake Williams, a former NSA hacker and now VP of research and development at Hunter Strategy, criticized the move, stating that it would allow contractors to skirt security requirements and potentially create more vulnerabilities in the system [1].

The Trump administration has not yet provided official details about the executive order, but sources indicate that it is part of a broader strategy to address perceived threats to national security and the financial system. The administration has been vocal about its concerns regarding the potential misuse of financial services by individuals and entities deemed high-risk or controversial.

The proposed executive order comes as the Trump administration continues to face scrutiny over its immigration policies and cybersecurity measures. The Supreme Court's recent decision to allow the Trump administration to swiftly deport migrants to third countries has further highlighted the administration's focus on national security and immigration enforcement [3].

As the potential executive order continues to gain attention, financial professionals and investors are closely watching the developments. The impact of such an order on the financial system and the broader economy remains uncertain, but the move is likely to be closely scrutinized by regulators, industry groups, and advocacy organizations.

References:
[1] https://arstechnica.com/security/2025/06/cybersecurity-take-a-big-hit-in-new-trump-executive-order/
[2] https://www.bbc.com/news/articles/c70r839kxd9o
[3] https://www.wsj.com/us-news/law/supreme-court-allows-trump-administration-to-swiftly-deport-migrants-to-third-countries-fad2d4f6