Introduction: In a stark reminder of the unchecked power wielded by financial institutions, Deutsche Bank recently terminated the account of Mohamad Safa, a UN-accredited human rights activist. His alleged crime? Speaking out against war crimes in Gaza. The latest in a long line of individual debanking exposes the darker side of Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) laws, which, despite being crafted with the intent to protect the public, often serve as tools for governments to silence dissent and curb civil liberties without due process.
The Global Reach of U.S. Financial Regulation: The troubling trend of debanking individuals based on their political beliefs or activism is not confined to any one country; it is a global issue with roots that trace back to the United States. The Bank Secrecy Act (BSA), enacted in 1970, was the first piece of legislation to formalize the monitoring of financial transactions in the name of national security. Over the decades, this law has expanded its reach, setting the stage for a global web of surveillance that enables governments and financial institutions to act with near-impunity.
A Tool for Suppression: AML/CFT laws, originally designed to combat terrorism and organized crime, have been co-opted into mechanisms for suppressing dissent. These regulations allow banks to close accounts and deny services based on vague and broad criteria, often without transparency or recourse. As Safa’s case illustrates, this is not just about preventing illegal activities—it’s about enforcing political orthodoxy under the guise of compliance.
In recent years, we’ve seen financial institutions increasingly act as enforcers of government policy. The case of Deutsche Bank is just one example of a broader pattern. In the United States, large banks like Bank of America and JPMorgan Chase have been caught debanking individuals and organizations based on their political or religious views. These actions are not mere accidents; they are often the result of direct pressure from federal agencies, which instruct banks to monitor and flag transactions that might indicate “risky” behavior.
The Dangerous Precedent Set by the BSA: The BSA is the cornerstone of this regulatory overreach. It grants sweeping powers to the Secretary of the Treasury to demand surveillance and reporting from financial institutions. This power is so broad and ambiguous that it can criminalize everyday activities and allow for selective enforcement based on political or social pressures. A recent report from Coin Center highlights the constitutional infirmities of the BSA, emphasizing how it delegitimizes the principle of fair and equal treatment under the law.
Civil Liberties at Risk: When banks, under the influence of AML/CFT regulations, start acting as arbiters of what is politically acceptable, civil liberties are under direct threat. The right to financial services is fundamental in modern society—without access to a bank account, individuals are effectively excluded from participating in the economy. Yet, in the name of security, this right is increasingly being eroded.
The idea that financial institutions can deny services based on an individual’s beliefs or speech is not just a violation of civil liberties; it is an affront to the principles of democracy. As Safa’s case shows, the lack of due process and the absence of transparency mean that individuals have no recourse when they are unfairly targeted.
A Call for Action: The case for abolishing AML/CFT laws is becoming increasingly urgent. These regulations do not just infringe on personal freedoms—they also undermine the foundational principles of justice and democracy. Governments and financial institutions should not be allowed to outsource policing powers without any form of democratic oversight or accountability.
Moreover, the global influence of the U.S. BSA and its expansion of surveillance powers demonstrate the dangers of allowing such laws to go unchecked. The time has come to reevaluate and ultimately dismantle the structures that allow for the weaponization of financial regulation. Until then, the risk remains that anyone, anywhere, could be targeted and silenced simply for their beliefs.
