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TN lawmakers approve landmark de-banking bill, send to governor's desk

ADF attorneys applaud legislators for protecting consumers from discriminatory de-banking by nationally chartered banks with at least $100 billion in assets
Tennessee Legislature Building

NASHVILLE, Tenn. – Tennessee state senators on Monday passed SB 2148, a first-of-its-kind consumer protection bill that prohibits big banks from canceling customer accounts based on their constitutionally protected speech and religious exercise. Paired with a companion bill that the Tennessee House of Representatives already approved, the legislation now moves to the desk of Gov. Bill Lee.

The bill prohibits the country’s largest banks from engaging in politicized de-banking—denying financial services based on a customer’s religious or political views. The issue is on the rise at America’s largest financial institutions and threatens Americans’ freedom of speech and religion. For example, in 2023, Bank of America used a vaguely worded “risk tolerance” policy to cancel the accounts of Memphis-based nonprofit Indigenous Advance Ministries, which serves orphans and widows in Uganda, and the account of a Tennessee church that occasionally supported Indigenous Advance.

Alliance Defending Freedom attorneys filed a consumer complaint on Indigenous Advance Ministry’s behalf last August. ADF also provided testimony and assisted state lawmakers in adopting the current legislation, which applies to large nationally chartered banks with at least $100 billion in assets.

“No one should be denied access to basic financial services because of their political or religious beliefs,” said ADF Senior Counsel Matt Sharp, director of the ADF Center for Public Policy. “Banks that are too big to fail are too big for bias. It’s the government’s duty to protect the fundamental freedoms of its citizens. That’s why Tennessee is doing the right thing here and charting the course for other states to follow.”

Prior to the de-banking incident involving Bank of America and Indigenous Advance, another example of politicized de-banking occurred in 2022 when JPMorgan Chase canceled the account of the National Committee for Religious Freedom, founded by former Senator and U.S. Ambassador Sam Brownback. Chase never gave a satisfactory reason for the cancelation, instead offering at least five contradictory and unconvincing explanations over the course of a year.

Underlying these cancelations are “reputational risk” and similarly vague and subjective policies that bank employees—and in some cases, government banking regulators—use to withdraw financial services based on customers’ exercise of their First Amendment rights.

ADF has filed friend-of-the-court briefs in two cases at the U.S. Supreme Court (Murthy v. Missouri and National Rifle Association v. Vullo) and one at the U.S. Court of Appeals for the 2nd Circuit (Volokh v. James) that involve the government inducing or encouraging powerful businesses to censor and penalize everyday Americans for their speech.

Earlier this month, ADF Senior Vice President of Corporate Engagement and Senior Counsel Jeremy Tedesco testified before the U.S. House Select Subcommittee on the Weaponization of the Federal Government, which previously disclosed that federal law enforcement agencies partnered with major banks and payment processors to flag Americans’ purchases from stores like Cabela’s, Bass Pro Shops, and Dick’s Sporting Goods, as well as those related to “religious texts,” including Bibles.

The subcommittee also disclosed that, as part of its efforts to urge financial institutions to monitor their customers to identify domestic threats, the U.S. Department of the Treasury shared a list of “hate groups” published by the hyper-partisan Institute for Strategic Dialogue. The list includes ADF and numerous other mainstream religious and conservative organizations that the federal government has associated with “domestic terrorists” and targeted for surveillance by major banks.

Tennessee’s bill would prohibit major financial institutions and insurance providers from discriminating against otherwise qualified customers because of their political or religious views, speech, or affiliations.

“Big Banks and Big Tech pose threats to freedom like Big Brother does,” said Tedesco. “What’s worse is the mounting evidence that Big Brother is enlisting Big Business in its censorship schemes. Government is too often attempting an end-run around the Constitution by outsourcing censorship to some of the most powerful corporations the world has ever known. But where the First Amendment is concerned, the government can’t do indirectly what it is forbidden from doing directly.”

“ADF is thankful to the Pro-Family Legislative Network, Foundation for Government Accountability, and the Tennessee Faith and Freedom Coalition for their invaluable expertise and support on this legislation. Additionally, we want to commend Sen. Majority Leader Jack Johnson and Rep. Jason Zachary for their leadership in passing this important bill,” Sharp added.

Alliance Defending Freedom is an alliance-building, non-profit legal organization committed to protecting religious freedom, free speech, parental rights, and the sanctity of life.

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Matt Sharp
Matt Sharp
Senior Counsel, Director of Center for Public Policy
Matt Sharp serves as senior counsel with Alliance Defending Freedom, where he is the director of the Center for Public Policy.
Jeremy Tedesco
Jeremy Tedesco
Senior Counsel, Senior Vice President of Corporate Engagement
Jeremy Tedesco serves as senior counsel and senior vice president of communications for Alliance Defending Freedom.