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It’s perhaps not a matter of great surprise that people living in autocracies would experience having their bank accounts closed for political reasons. In recent years, however, there’ve been a number of high-profile cases of people living in advanced democracies claiming effectively the same thing has happened to them. In 2022, for instance, the Canadian government invoked emergency laws to freeze the bank accounts of hundreds of people linked to protests against Covid-19 vaccine mandates.

In the United Kingdom, Coutts & Co. closed the bank accounts of Nigel Farage, now the leader of populist-right party Reform UK and a member of Parliament, after it found that his values “do not align with the bank’s.” As Coutts elaborated, “At best he is seen as xenophobic and pandering to racists, and at worst, he is seen as xenophobic and racist.” It triggered a wide-ranging scandal: The bank’s CEO resigned while parliament tasked regulators with looking into the matter. Their finding? That there was no evidence any bank reported they had closed bank accounts “primarily due to someone’s political views”—but that they would need to make further inquiries, particularly in more opaque “reputational” cases.

In the United States, Melania Trump said she and her son Barron had their accounts frozen shortly after the Capitol Hill riot on January 6, 2021. Several organizations sending humanitarian aid to Gaza have had their bank accounts closed, as financial institutions have managed the risks of sanctions compliance. And in late November, the investor Marc Andreessen triggered a national controversy when he claimed the Biden administration had been cutting off tech executives from their bank accounts because of their political views. How common is all this?

Victoria Barnes is a reader of commercial law at Queen’s University Belfast. Barnes says, much more common than it used to be. But that’s generally not because banks have become the agents of governments—or otherwise more political as such themselves. It’s because they’ve always put a premium on managing their reputations—since they compete for the same customers with more or less the same services, they rely heavily on their reputations for advantage—and in an age of social media and partisan polarization, customers’ political views and involvements have increasingly integral to how banks look at reputational risk …

• “In many democratic countries, perhaps especially in the U.K., banks have been private enterprises for a very, very long time. With the exception of the Bank of England, direct government involvement has been relatively low. You typically don’t see the government mandating who’ll have access to financial services. And English banks have been capitalistic in the sense that largely, they’ve just wanted good customers—which is to say, people with substantial capital. But it’s not to say that their customers’ politics haven’t mattered. Banks are social communities as much as they are financial institutions; they want customers who fit in, not ones who’re controversial, let alone have plainly bad reputations.”
• “Famous politicians can make their objections heard, but most people can’t. For most people, when they have their accounts suddenly taken away—or are denied an account in the first place—they have nowhere to complain. Consumer law is very opaque, and the best remedy is rarely obvious. Banks do have regulators. In the U.K. there’s the Financial Conduct Authority, which offers routes you can go through to regain your account. But it’s usually not clear what the right course of action is. So most people tend just to accept what’s happened, find a different bank, and move on. But that’s sometimes a problem, especially for certain social groups.”
• Why are banks so sensitive about their reputations? “Because the service they offer is intangible. It’s about competition. I could bank with either Barclays or Lloyds but the service would be pretty much the same; they’d each offer me loans and a place to put my money. So the only thing they can really trade upon is their reputation for stability, security, and having a good social conscience. A customer who doesn’t represent those values might be a reputational risk, which then means other people won’t bank there in the first place.”

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Many warships, few words

On December 10, Taiwanese defense officials called a news conference to present evidence about the drills. They say they think China wants to show it has the strength both to conquer the island and to prevent the U.S. and its allies from coming to Taiwan’s defense.

Media reports also suggested that China would launch some sort of operation to show its displeasure that Taiwan’s President Lai Ching-te visited Hawaii, along with the U.S. territory of Guam, in early December while on an official visit to other partners in the Asia-Pacific.

What’s Beijing up to?

In October, Issac Kardon looked at its strategy in the South China Sea, with China having stepped up its military presence—and its harassment of neighboring countries—in recent years. These exercises, Kardon says, have multiple goals: One is to prepare the battlefield for a potential invasion of Taiwan, which Beijing wants to reunite with the mainland. But a larger goal is to establish China as the dominant maritime power in the whole South China Sea—which has menacing implications toward the U.S. presence there.

—Michael Bluhm

• The German car manufacturer Volkswagen announced recently that it is selling its stake in a factory in the Uyghur region of northwestern China—Xinjiang Province, as Beijing calls it. VW says the move is driven by economic factors, as the plant’s internal-combustion cars faced dramatically lower demand—but the company has come under chronic international pressure to leave the area: “The sale comes after the U.S. government and human rights groups have, for years, accused China of using forced labor and committing other abuses, such as mass detentions, in Xinjiang against the Uyghur Muslim minority group.”Here in The Signal, Kalbinur Sidik has talked about her experiences as a Uyghur Muslim in northwestern China. Imprisoned in 2017, she details how the Chinese government has constructed an elaborate surveillance system there and detains anyone who makes any public display of their religious faith.
• In the Seychelles, warblers mate for life, with less than 7 percent of couples separating each year. Unfortunately, changes in the climate could be complicating these relationships. A recent study, published in the Journal of Applied Ecology, has found that in years of extreme weather, the warblers’ divorce rates soared, sometimes more than doubling to 16 percent: “It’s unclear what this all means for the warbler population overall,” the environment journalist Katarina Zimmer says, but “it’s clear that the heating of the Earth’s atmosphere has not only obvious and direct impacts on animal survival, but also more subtle and complex influences on their lives, the decisions they make, and the relationships they cultivate with one another.”
• This winter, a never-before–exhibited Caravaggio painting is being shown to the public in Rome’s Galleria Nazionale d’Arte Antica. It’s a portrait of Maffeo Barberini, who in 1623 became Pope Urban VIII: “The portraits painted by Caravaggio can be counted on the fingers of one hand, so being able to show one to the public and to experts is exceptional,” said the gallery’s director Thomas Clement Salomon. “The heart of the painting lies in the hands,” said its curator Paola Nicita, “the left hand clutching a letter and the right hand emerging from the painting, entering our space.”

• Struggling to break away from algorithms and discover new things on the internet you’ll actually delight in? Internet is Beautiful can help. Every week, they’ll send newly launched websites, hidden gems, and useful tools or products you’re not likely to find on your own.

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