Warren Targets Trump-Linked Crypto Bank Approval With Ethics Bill

Senator Elizabeth Warren and several Democratic legislators introduced a bill on Saturday aimed at preventing presidents and other high-ranking officials from owning or controlling banks. This legislation follows the federal regulator, the Office of the Comptroller of the Currency (OCC), granting conditional preliminary approval to World Liberty Trust Company (WLTC) for a national trust bank charter tied to the Trump family's cryptocurrency venture, World Liberty Financial.

Warren, the Democratic chair of the Senate Banking Committee, denounced the approval as an unprecedented conflict of interest, highlighting that President Trump is the first president in history to simultaneously approve, operate, and supervise his own bank. She described it as the most blatant instance of self-dealing within the financial system and urged Congress to disallow such practices.

World Liberty Financial, however, contested the characterization, asserting that their bank would undergo continuous oversight and regulation. Their spokesperson, David Wachsman, stated that the proposed bank would operate under persistent federal supervision, including regular examinations of its finances, risk management, and internal controls. He also emphasized that federal banking laws, including anti-money laundering and consumer protection regulations, would apply to the institution.

The proposed legislation, the Ending Presidential Corruption in Banking Act, would prohibit federal agencies such as the Federal Reserve, OCC, and Federal Deposit Insurance Corporation from approving banking applications involving a president, vice president, member of Congress, or their immediate family members if they own, control, or have significant influence over the bank.

The act would also require regulators to review any approvals granted post-January 20, 2025, and revoke charters, licenses, or deposit insurance if covered individuals held control over the institution at the time of approval.

The OCC approved WLTC's application in January, but the license has not yet received final clearance. If granted, the trust bank would enable World Liberty to manage and hold assets for customers, facilitate payments, and directly support the creation and custody of its USD1 stablecoin. Unlike conventional commercial banks, trust banks do not accept deposits or issue loans.

The regulator imposed conditions, including capital requirements and additional operational and governance controls, before WLTC could commence operations. This approval has sparked controversy, coinciding with Trump's recent pro-crypto policies and stablecoin legislation, which critics argue create conflicts of interest between his public policy priorities and his family's business interests in the sector. Warren has previously raised similar concerns about the Trump family's cryptocurrency ventures.