FTC Chairman Ferguson warned PayPal, Stripe, Visa, and Mastercard that debanking customers on political grounds may violate the FTC Act. The letters cite Section 5 of the Act, which bars “unfair and deceptive” acts or practices, and point to publicly reported debanking incidents at PayPal and Stripe.
The letters also invoke President Trump’s August 7 Executive Order, “Guaranteeing Fair Banking for All Americans,” which bars financial institutions of any size from denying services based on political views, religious beliefs, or lawful industry involvement.
Ferguson’s enforcement theory hasn’t been tested. The CFPB under Director Chopra tried classifying discrimination as an “unfair” act under its UDAAP authority, and a District Court struck it down using the major questions doctrine: agencies can’t claim sweeping authority over issues of major political significance without clear congressional authorization.
Ferguson’s letters don’t cite a different legal hook. If the FTC pursues enforcement on the same theory, it’s walking into the same wall.
The regulatory backdrop has shifted. The Federal Reserve proposed eliminating reputational risk from its examination programs. The NCUA issued a formal NPRM to codify the same. The OCC began removing reputational risk from its handbooks in March 2025. The FDIC voted unanimously on April 7 to approve a final rule.
The letters warn violations could trigger an FTC investigation and enforcement action. No response deadline was specified.
James Okafor