Ron DeSantis signs anti-woke law to stop banks from freezing Floridians’ bank accounts based on their policies

The Treasury Department took aim at Florida’s new anti-wake banking law — warning it could open the floodgates for criminals to use and manipulate the U.S. financial system.

The new state law (HB 989)signed by Florida Governor Ron DeSantis in May, states that it would be “unsafe and unsound” for banks to consider non-financial factors such as politics, religion or environmental, social and corporate governance (ESG) when doing business.

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“We reject a global elite that tries to impose its ideology on us through the capture of major institutions,” said DeSantis, who led an aggressive campaign against so-called “woke” ideology in the Sunshine State by signing HB 989 into law.

“We will not allow big banks to discriminate based on someone’s political or religious beliefs.”

But while DeSantis claims he is fighting discrimination, the U.S. Treasury has labeled the Florida law — and other similar laws under consideration in mostly conservative states such as Arizona, Georgia, Idaho, Indiana, Iowa, Kentucky, Louisiana and South Dakota — as a potential threat to national security.

Here’s why policymakers are pushing back against so-called unbanking – and what it means for Americans.

Florida prevents unbanking

DeSantis’ goal with HB 989 was to “strengthen protections for Florida consumers…against being forced to adopt ideologies or reflect preferred political behavior.”

For one Associated Press report, DeSantis said the law will protect the access that conservative groups and the gun industry have to the financial sector — and prevent them from having their accounts frozen or closed.

O law makes it illegal for banks to “deny or cancel, suspend or terminate services to a person, or otherwise discriminate against a person in making such services available” based on a number of factors, including (but not limited to):

• The person’s political opinions, speech, or affiliations

• Any factor, other than a quantitative, unbiased, risk-based standard, including any factor related to the person’s business industry

• The person’s involvement in the lawful manufacture, distribution, sale, purchase, or use of firearms or ammunition

• The person’s involvement in the exploration, production, use, transport, sale or manufacture of energy based on fossil fuels, timber, mining or agriculture

The story continues

It also allows Floridians to appeal “unreasonable account cancellations and restrictions” through a coordinated complaint and investigation process within the state’s Office of Financial Regulation.

This potentially puts banks and other financial institutions operating in the Sunshine State between a rock and a hard place. They are required by federal law to implement U.S. criminal and national security policies – including rigorous background checks – but in doing so they risk violating Florida’s broad anti-discrimination law.

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Treasury bites back

Treasury has openly criticized Florida’s new law and any other state laws that prevent financial institutions from performing necessary risk assessments.

In a July letter to lawmakers, obtained by Wall Street JournalTreasury Undersecretary Brian Nelson reiterated the importance of banks being able to probe customers in order to prevent money laundering and combat terrorist financing.

“State laws that interfere with the ability of financial institutions to meet national security requirements increase the risk that international drug traffickers, transnational organized criminals, terrorists, and corrupt foreign officials will use the U.S. financial system to launder money , evade sanctions and threaten our national security,” he wrote.

The letter was sent in response to a July 8 request from Rep. Josh Gottheimer, D-N.J., Rep. Blaine Luetkemeyer, R-Mo., and Rep. Brad Sherman, D-Calif., who shared concerns about the potential negative impact of the new debanking laws.

“To all states considering similar legislation, I urge you to think twice before putting America’s national security at risk,” Rep. Gottheimer said in a statement.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.