Capital One says it closed Trump Organization accounts over money-laundering concerns : NPR

Capital One has filed a request with a federal judge to dismiss a lawsuit from the Trump Organization regarding the closure of several hundred bank accounts in 2021. The bank contends that the shutdowns resulted from a lengthy anti-money-laundering investigation, as opposed to being a retaliatory measure for the January 6 Capitol riot, as claimed by the Trump businesses.

Capital One’s legal team, in a motion submitted on Friday in a Florida federal court, asserted that both the bank’s documentation and the allegations from Trump-affiliated businesses “clearly indicate that Capital One terminated the accounts for anti-money laundering (‘AML’) reasons.”

According to the bank, the decision was the result of “months of analysis and a thorough review” conducted by its financial-crimes team, which includes staff with extensive law enforcement experience. However, the filings imply that the Trump Organization and its affiliates were not given a chance to address any allegations of money laundering or compliance issues before the accounts were closed.

It remains uncertain whether subsequent banks for the Trump Organization have raised similar money laundering concerns or how the organization addressed Capital One’s allegations. The Trump Organization did not immediately respond to requests for comment.

This legal battle is part of a series of lawsuits initiated by Trump-aligned entities against major banks following Trump’s return to the White House.

A long-standing dispute over numerous accounts

The case revolves around approximately 385 accounts linked to the Trump Organization, Eric Trump, and related businesses such as a winery, bottled-water company, and golf course developer. These accounts had been with Capital One for over a decade before being closed in mid-2021.

An amended complaint filed earlier in July by the Trump-affiliated companies claims that the closures were politically motivated rather than related to any financial crime or money laundering.

The Trump Organization asserts that Capital One sought to dissociate itself from Donald Trump following the Capitol riot and that the anti-money-laundering justification was fabricated after the decision was made.

Capital One refutes these claims, with its lawyers arguing that the Trump theory relies on “selective quotes taken out of context” from the bank’s records. They further assert that the complaint does not demonstrate that the anti-money-laundering explanation was a pretext.

The bank’s lawyers also highlighted that the reasons for the closures were kept confidential, stating that the bank “never publicized the termination decision nor its confidential internal process that led to the closure.” They noted that the Trump companies were given several months and multiple extensions to transfer their funds, which they did.

Significant portions of the Trump-linked amended complaint from July remain sealed under a court-approved order, including a section titled “January 6, 2021: The Political Trigger.”

The bank asserts its contract permits broad discretion

Aside from disputing the factual claims, Capital One reiterated in its recent court filing that it has the right to close any account “at any time, for any or no reason, and without notice.” This language is not contested by the Trump companies.

Judge Roy Altman previously dismissed an earlier version of the lawsuit in March, ruling that a bank’s reason for closing an account under such an open-ended contract clause generally cannot be challenged in court.

Capital One has requested that Altman dismiss the new complaint permanently this time, without allowing for another refile.

The bank is also contesting a new claim added by the plaintiffs in July, which alleges that Capital One committed fraud by remaining silent about its reasoning.

Capital One’s attorneys argue that the bank was not obliged to explain itself and contend that federal banking-secrecy law would have prohibited it from disclosing internal anti-money-laundering findings even if it had wanted to.

A related battle over what remains sealed

The secrecy law is also central to a related dispute over what information is accessible to the public. In a separate motion filed on Friday, Capital One requested that the court keep sealed a portion of one exhibit containing information protected under the Bank Secrecy Act, along with employee names, customer account numbers, and unrelated compensation details.

The Trump companies do not oppose sealing the account numbers or the Secrecy Act-related passage, but they are challenging several other redactions that Capital One wishes to maintain.

A separate lawsuit against JPMorgan Chase, filed in January regarding accounts closed during the same period, makes similar allegations.

President Trump issued an executive order last August directing regulators to address what he and other conservatives describe as politically motivated ‘debanking.’

Capital One has had previous legal conflicts with Trump: in 2019, during his first term, Trump sued the bank along with Deutsche Bank to prevent them from handing over his financial records to a congressional inquiry led by Democrats.