Trump vs. Capital One: How Suspicious Activity Rules Can Close Your Account Without Warning

Key Takeaways

The Trump Organization is suing Capital One over the bank’s decision in 2021 to close hundreds of accounts tied to Trump businesses. The bank says it closed the accounts due to suspicious activity.
The average bank customer can also occasionally get flagged for suspicious activity, and too many questionable transactions could cause your bank to report you to the government or close your account.
Certain types of transactions tend to get flagged more than others.

A legal battle between the Trump Organization and Capital One has recently put a spotlight on how banks monitor your transactions and what they may do if they find too many red flags.

The Trump Organization is suing the major U.S. bank after the institution in 2021 closed roughly 300 bank accounts tied to Trump businesses. Capital One says the decision to close the accounts came after “months of analysis and a careful review” by its anti-money laundering investigators. Trump lawyers allege the accounts were shut down as retaliation for the Jan. 6 Capitol riot.

While Capital One hasn’t accused the Trump Organization of any crimes, it essentially said the organization’s transactions set off enough alarm bells that the bank decided to cut ties and close the accounts. The Trump Organization argues the bank’s actions were politically motivated and an example of a larger multiple-institution debanking effort the president believes is targeting conservatives.

“The transaction patterns identified by Capital One are among the types of activity flagged by federal banking guidance,” Capital One lawyers said in a motion in late July.

The high-profile dispute between a major U.S. bank and President Trump’s main business conglomerate makes for an entertaining saga but probably feels far removed from and irrelevant to your daily life.

You’re likely not a public figure. You almost certainly don’t have 300 bank accounts.

And you’re not engaging in any suspicious banking activity. Or are you?

Even if you’re not up to anything financially nefarious, certain types of transactions can raise red flags at your bank. A new side hustle, a large check from Grandma or multiple cash deposits on subsequent days could all trigger a closer look from your institution.

Rarely would these transactions result in the bank’s going nuclear and closing your accounts entirely. It’s also unlikely your activity would rise to the level where the bank would need to report you to the government. But innocent transactions regularly get flagged, and you’ve probably excited your bank’s algorithms occasionally without even knowing it.

Here’s a look at the transactions and banking activities that commonly get flagged as suspicious, how banks may handle them and what you should do if your account is at risk of being closed.

How Banks Handle Suspicious Activity

Banks may close your account for various reasons, such as inactivity or consistently overdrawing your balance.

But a bank may also shut down your account if it detects an amount of suspicious activity that exceeds its threshold for risk.

Most banks have sophisticated systems in place that monitor customers’ transactions and patterns of activity. These systems serve several purposes. They help banks meet their Bank Secrecy Act legal requirements to take steps to find, prevent and report illegal money movement such as money laundering or the funding of terrorism. They also protect customers by identifying fraud or scams.

If a bank suspects certain types of illegal activity are taking place, it must notify the Treasury Department’s Financial Crimes Enforcement Network by filing a suspicious activity report, commonly called a “SAR.”

Roughly 4.8 million SARs were filed in fiscal year 2025, with depository institutions such as banks and credit unions filing about 2.8 million of those.

You’d typically have to rack up multiple SARs before a bank would actually close your account, and the odds are you don’t have any against you, says Emily Griffin, director of financial crimes practice at Moody’s Analytics.

“The average person living their financial lives is probably not generating a SAR,” says Griffin.

However, it’s very possible you’ve made transactions that were flagged by your bank’s systems as potentially suspicious, and those may have led to a manual review or even a call from your bank asking for further explanation. During that review, a bank may temporarily freeze your account or disable certain services such as wire transfers.

“Customers often imagine that a bank employee sees a large transfer and decides to freeze the account,” says Yulia Plugatyreva, a senior SOX and IT auditor at Chime. “In reality, the initial flag is generated automatically by rules, machine-learning models or a combination of both.”

She says a bank’s systems typically evaluate numerous signals they receive from a customer’s banking habits and activity, producing a risk score. Certain transactions may increase the score, either because they are the types of activity commonly seen in criminal cases or because they don’t match a customer’s normal behavior. If enough risk signals are detected, it may trigger an alert and result in the bank’s conducting a manual review.

“Beyond any single transaction, the patterns matter,” says Jeff Carpenter, president and CEO of Oklahoma-based WEOKIE Federal Credit Union. “Everyone has different personal financial habits, so it is less about one flagged transaction and more about whether something looks different from how a person normally uses their account.”

For example, a large deposit isn’t necessarily going to raise red flags if it fits within a customer’s usual habits.

“That is why there is no universal list of ‘safe’ and ‘suspicious’ transactions,” says Plugatyreva. “The same $8,000 deposit may look routine for one customer and highly unusual for another.”

You Might Get Flagged for These Transactions

The types of transactions that could trigger suspicion may vary from bank to bank, but certain activity is more likely to raise alarms.

“A sudden large check, an ACH transfer from an unrelated account or consistent deposits (or) transfers by Cash App or Venmo could all be flagged,” says Brad Lynch, director of fraud investigations and recovery at Minnesota-based Wings Credit Union and a former FBI agent. “The check could be a forgery, the ACH could be attempted theft from someone else’s bank account and the Cash App or Venmo transactions could be indicative of a larger fraud scheme moving stolen funds.”

Here are some of the most common transactions that can be flagged as suspicious by your bank.

Unusually Large Deposits

Cash deposits of this size aren’t common, but bank representatives say this can happen if a customer sells a large item for cash or earns an influx of money in a side business.

Sizable checks can also raise alarm bells. Although check use is declining, check fraud has been rising for years, so banks may want to take a closer look if you suddenly turn up with a large check.

Multiple Cash Deposits or Withdrawals That Add Up to $10,000 or More

Want to get on the fast track to a suspicious activity report? This could be your ticket.

Some criminals try to sidestep the required reporting of $10,000 deposits by breaking up cash deposits into smaller increments and spreading them out over several days. For example, a person might deposit $9,000 one day, then return the following day and deposit another $5,000, perhaps at a different branch.

Often referred to as “structuring,” this practice will usually get spotted as suspicious by your bank.

But there are completely legitimate ways you could get tripped up by this. A large yard sale over a long weekend could easily result in your dropping off bigger-than-usual cash deposits several times, especially if you don’t want to be holding onto stacks of cash.

Large withdrawals can also get noticed. For example, you might get flagged if you pay a contractor in several installments that each fall just below the reporting threshold, says Jeff Scott, managing director of fraud intelligence at Q2 Holdings.

“A rules engine cannot tell the difference between someone avoiding paperwork and someone doing it innocently,” says Scott.

A Flurry of Transfers From Payment Apps

Peer-to-peer payment apps such as Venmo or Cash App can be used to move stolen funds quickly.

A high volume of transactions, especially if they are coming from multiple sources you don’t typically transact with, can trigger monitoring algorithms designed to detect various schemes.

You may inadvertently raise suspicions if you recently started a new side hustle and receive many small payments through these channels when you rarely used them before. Or you might be splitting expenses for a large group trip, such as a wedding or bachelor party, where you are the point person receiving funds from multiple friends.

Transfers From Unrelated Accounts

Suddenly moving money repeatedly between accounts that aren’t both in your name can cause banks to wonder whether you’re engaging in illegal activity. Anti-money laundering teams may suspect you’re involved in “layering,” where criminals shuffle funds through multiple financial transactions to make it harder for authorities to trace their origin.

Scott, of Q2 Holdings, says he’s seen innocent customers get flagged for this when trying to help aging parents with their finances.

Your Dormant Account Suddenly Becomes Active

An account that has remained inactive for a long time can get flagged if it suddenly sees an increase in usage. This could indicate that the account is being used by criminals to launder money or it could be a sign that a legitimate account has been taken over by fraudsters.

There are cases where you might resuscitate an old account. For example, you might decide to finally use an old college checking account you forgot about to deposit a large inheritance or the proceeds from selling a vehicle, causing a sudden spike in activity after years of inactivity.

You Say Something Suspicious to a Teller

Bank tellers are trained to keep an ear out for potential scams or illegal activity when interacting with customers. In many cases, they’re trying to protect you from potentially falling victim to a scam.

But they also may file a SAR against you if you say the wrong thing, and innocent people can accidentally sound suspicious. For example, if you’re depositing a large amount of cash, it’s unwise to ask if there’s a way to avoid getting it reported.

What You Should Do if Your Bank Flags Your Activity as Suspicious

Federal law prohibits banks from telling you if a suspicious activity report has been filed. However, experts say in most cases your bank will have reached out well before any report is made. That’s when it’s important to act quickly.

If unusual activity is detected, your bank may temporarily freeze your account while it reviews your activity. The bank may contact you and request documentation supporting your explanation for the transaction. Experts say providing the proper documents promptly will likely get your situation resolved.

Some banks are starting to use a more precise response, known as “restricted entitlements,” where they only freeze the one particular type of transaction in question, says Scott.

“Restricted entitlements is now a middle option that most customers have never heard about but will start seeing more of,” he says. “Instead of freezing the whole account, the bank turns off the specific ability that looks risky, such as adding a new payee, initiating a wire or changing the email on file, and leaves everything else running.”

If your bank ultimately does close your account, you can ask for the reasoning.

“You can request an explanation of why it was closed,” says Griffin. “Banks do not have to necessarily tell you, especially if it’s one of the prohibited items, like a SAR was filed.”

If you’re not satisfied with your bank’s answers, Griffin says you could request a ChexSystems report – similar to a credit report for bank accounts – to see if it offers hints at what may have happened.

If your account is closed, don’t forget to ask a bank representative to provide instructions for what you’ll need to do next.

“If an account is ultimately closed, the (customer) should also ask what will happen to any remaining funds and what steps may be needed for direct deposits, automatic payments, outstanding checks, or pending transactions,” says Carpenter.