ICYMI: Ibsen: Texas Lawmakers Are Right to Address Debanking, But the Fix Is in Washington

“Texas lawmakers have an opportunity to send a powerful message to Washington: Texas supports fair access to financial services, but a federal problem demands a consistent federal solution.”

In case you missed it, Americans for Free Markets (AFFM) Executive Director David Ibsen published a new op-ed in the Rio Grande Guardian highlighting Texas lawmakers’ efforts to protect consumers and businesses from government-driven debanking while cautioning against adding new state regulations that could make banking more complicated and costly.

 
“Last session, Senator Tan Parker introduced SCR 44, urging Congress to address federal regulatory pressure on banks, modernize federal banking laws and increase transparency and accountability for bank regulators. That was the right approach then, and it remains the right approach today.”

Ibsen argues that government-driven debanking is rooted in federal policy and should be addressed at its source. He references how President Trump has already taken action through his executive order which directs federal banking regulators to remove “reputation risk” from supervisory standards. This regulatory tool has been used in previous administrations to pressure banks to cut ties with consumers and businesses for political or religious reasons.

“Texas lawmakers have an opportunity to send a powerful message to Washington: Texas supports fair access to financial services, but the solution to a federal problem demands a consistent federal standard. The U.S. Senate should pass the FIRM Act and finish the work President Trump started.”

The op-ed came as the Texas Senate Committee on State Affairs convened an interim hearing on several topics, including debanking and ESG criteria on Tuesday, September 15.

AFFM applauds the Texas Legislature for working to address politically-motivated debanking but cautions against new state mandates. While well-intended, President Trump and Congress are already working to address this at the federal level. Additional regulation could make the banking system more complicated and costly for businesses and consumers.

Texas should avoid replacing one problem with another. As Ibsen writes, Texas can protect consumers while preserving the free market principles that have helped make the state an economic leader.

“Texas understands better than most that economic growth comes from clear rules, regulatory certainty and limited government. Those same principles should guide our approach to debanking.”

Watch the recording of the Senate State Affairs Committee hearing from September 15 HERE and read David Ibsen’s op-ed HERE.