Two of Canada’s largest banks, TD Bank and BMO Bank, have been named alongside seven American megabanks in a scathing federal review accusing the U.S. financial industry of discriminating against customers over their political, religious or social beliefs. The report, released Wednesday by the Office of the Comptroller of the Currency (OCC), is the latest flashpoint in a Trump-era campaign against what the administration calls “de-banking” — and it puts Canadian lenders’ sprawling U.S. operations squarely in the political crosshairs of Washington’s culture-war approach to financial regulation.
What the OCC Actually Found
According to Yahoo Finance’s reporting on the regulatory review, the OCC examined nearly 100,000 complaints and collected roughly 50,000 documents from nine of the largest banks operating in the United States: JPMorgan Chase, Bank of America, Citibank, Wells Fargo, U.S. Bank, Capital One, PNC Bank, TD Bank, and BMO Bank. The watchdog concluded that the banks’ internal guidelines for accepting or rejecting customers lacked objective, risk-based criteria, and instead allowed ideology to influence who got — or didn’t get — access to basic financial services.
Comptroller of the Currency Jonathan Gould did not mince words. “Today’s report provides irrefutable evidence that the nation’s largest banks have denied, debanked, and discriminated against customers and lawful businesses,” he said, adding that “Americans should have access to financial services regardless of their beliefs, affiliations, or political views.”
The sectors named as having faced restricted access include oil and gas exploration, coal mining, firearms and ammunition manufacturing, operators of detention facilities, and tobacco or e-cigarette businesses — all politically charged industries that have, at various points, become targets of corporate environmental, social and reputational risk policies.
The Mechanism: Reputation Risk as a Gatekeeper
Central to the OCC’s complaint is the concept of “reputation risk” — a long-standing but vague category banks have used internally to justify declining business relationships that might embarrass them publicly, separate from the harder metrics of credit risk or money-laundering exposure. The OCC’s report says all nine banks, including TD and BMO, have told regulators they have reassessed how heavily that factor weighs into account decisions. Several banks reportedly told the OCC they have scaled back reliance on reputation risk altogether, instructing staff to weigh it only alongside concrete financial or legal exposures.
That shift did not happen in a vacuum. The Trump administration has made “de-banking” a signature grievance, arguing that financial institutions have weaponized internal compliance policies to freeze out industries and individuals whose politics or affiliations clash with mainstream corporate sentiment. The Bank Policy Institute, the industry’s own lobbying arm, responded carefully, saying it supports “efforts to establish clear and consistent standards that promote access while maintaining sound risk management,” including the administration’s push to prioritize material financial risk over reputational judgment calls.
Why TD and BMO’s Inclusion Matters for Canada
For Canadian readers, the detail that stands out is not the broader de-banking debate itself — which has been simmering in Washington for more than a year, including an earlier Federal Reserve report in December 2025 that faulted Bank of America, Wells Fargo and others over similar practices, per the Charlotte Observer. What matters is that TD and BMO, two institutions with deep retail and commercial footprints in the United States, are now named in the same breath as JPMorgan and Citibank in a federal regulatory review with an openly adversarial tone toward the industry.
Both banks operate substantial U.S. subsidiaries — TD Bank, N.A. and BMO Bank, N.A. — serving millions of American customers and businesses, particularly in the northeastern U.S. and Midwest. Being named in an OCC review that the Comptroller himself describes in terms of “irrefutable evidence” of discrimination places both institutions under heightened scrutiny from an already assertive U.S. regulator, at a moment when cross-border financial institutions have little appetite for additional political exposure in Washington.
A Banking Sector Already Under the Political Microscope
This report doesn’t land in isolation. It arrives amid a broader pattern of the Trump administration testing the boundaries of independence and neutrality across American financial institutions. The Canadian Press reported this week that lawyers for Federal Reserve Governor Lisa Cook have accused a White House-created “committee of inquiry” — tasked with determining whether Trump has cause to fire her — of being “demonstrably biased,” given that its three members are all Trump appointees, including economic adviser Kevin Hassett, who has already stated publicly that cause exists to remove her. That dispute, over an alleged 2021 mortgage-fraud allegation Cook denies, is itself unprecedented: no sitting president has ever fired a Fed governor, a fact underscoring just how aggressively the current administration has been willing to press against the traditional firewall between the White House and U.S. monetary and banking oversight.
Seen together, the OCC’s bank review and the Cook affair point to the same broader story: American financial regulation is increasingly being used as a tool in ideological battles, with reputational risk policy, central bank independence, and now account-level banking decisions all pulled into the fray. For foreign-headquartered banks like TD and BMO, that means operating inside a regulatory environment where the rules of engagement — what gets you labeled as discriminatory, what counts as legitimate risk management — are shifting underneath long-standing compliance frameworks.
Banks’ Response and the Business Calculus
Neither TD nor BMO issued an individual statement in the source material reviewed here; the only industry-wide reaction came from the Bank Policy Institute, representing all nine named banks collectively. Its measured, non-confrontational tone — essentially endorsing “clear and consistent standards” rather than disputing the OCC’s findings outright — suggests the industry has calculated that pushing back hard against a politically charged federal review carries more risk than quietly adjusting internal policy language around reputation risk, which several banks have apparently already begun doing.
That calculus reflects the asymmetry of the moment: the cost of being seen as non-compliant with an administration actively willing to use regulatory and even personnel powers (as in the Cook case) outweighs, for now, the cost of walking back internal compliance frameworks that in some cases took years to build.
Our Take
In our view, the inclusion of TD and BMO in this report is less a story about these two banks specifically discriminating against customers — the OCC’s review, as reported, describes systemic industry practices rather than singling out either Canadian-owned institution for unique conduct — and more a story about how exposed Canadian financial institutions have become to the volatility of U.S. political and regulatory dynamics simply by virtue of operating large American subsidiaries.
We think the more interesting question for Canadian boardrooms isn’t whether TD or BMO change their U.S. account-opening policies — they likely will, quietly, alongside their American peers, simply to avoid becoming a convenient political target. It’s whether this kind of politically inflected regulatory pressure becomes a durable feature of operating in the U.S. financial system, one that Canadian banks will need to budget for strategically rather than treat as a one-off controversy.
It’s also worth watching how this dovetails with the broader erosion of institutional independence playing out in Washington — from the Lisa Cook fight over Fed governance to the OCC’s combative framing of “irrefutable evidence” against an entire sector. If reputational-risk compliance frameworks that global banks like TD and BMO built over a decade are now being unwound under political pressure, the downstream question for Canadian consumers and businesses with U.S.-facing banking relationships is whether consistency and predictability in how these institutions manage risk — on either side of the border — can be taken for granted going forward. Based on the sources here, that’s an open question rather than a settled one, and it’s one worth watching closely as Ottawa and Washington continue to navigate an increasingly unpredictable financial and regulatory relationship.
This is a Commentary piece: analysis and editorial perspective from Canadian Business News, clearly distinguished above from the reported facts it’s based on. It is not financial, investment, or legal advice.
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