9 Unethical Banks to Avoid? A Fact-Checked 2026 Review
Which banks should you avoid on ethical grounds? There is no universal answer. Based on recent official enforcement records, major criminal and regulatory resolutions, and 2025 fossil-fuel financing data, nine banks warrant closer scrutiny: Bank of America, Citigroup, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan Chase, TD Bank, U.S. Bank, and Wells Fargo.
This is not a solvency ranking, and it does not mean every account, employee, or current practice at these institutions is unethical. A bank’s conduct record, deposit safety, fees, customer service, accessibility, and product quality are separate questions. The goal is to help you investigate the evidence and decide whether your bank aligns with your priorities for ethical banking.
Research last verified July 22, 2026. This article is educational and is not personalized financial advice.
Key takeaways
- “Unethical” is a value judgment, not an official regulatory category. This review uses documented evidence rather than treating opinion as fact.
- Consumer harm and financial-crime controls matter. Recent official cases range from unauthorized accounts and mishandled loans to anti-money-laundering failures and inadequate market surveillance.
- Climate financing is a separate ethical lens. The 2026 Banking on Climate Chaos report attributes substantial 2025 fossil-fuel lending and underwriting commitments to every bank in this review.
- Remediation matters. Wells Fargo’s 2018 Federal Reserve action was terminated in March 2026, and the CFPB terminated its U.S. Bank order in August 2025 after required obligations were fulfilled.
- Bank ethics is not the same as deposit safety. Before moving money, confirm federal deposit or share insurance and compare account terms.
Contents
- The nine banks at a glance
- How this review defines unethical banking
- Documented controversies by bank
- How to evaluate a bank before opening an account
- How to switch banks without missing a payment
- Better-aligned banking alternatives
- Frequently asked questions
Nine banks with major ethical controversies at a glance
The table is alphabetical, not a ranking of overall ethics. Regulatory cases and criminal resolutions are not directly comparable with climate-finance estimates, so the evidence is presented in separate columns rather than collapsed into a misleading score.
| Bank | Documented issue highlighted in this review | 2025 fossil-fuel financing attributed by BOCC | Important context |
|---|---|---|---|
| Bank of America | 2023 CFPB action involving repeat insufficient-funds fees, withheld card rewards, and unauthorized credit-card accounts | $47.3 billion; No. 2 | The order required consumer compensation and penalties |
| Citigroup | 2024 Federal Reserve fine for violating a 2020 enforcement action covering data quality and risk controls | $45.3 billion; No. 5 | The Fed said the 2020 action remained in effect at the time of its 2024 release |
| Deutsche Bank | 2023 Federal Reserve fine tied to sanctions and anti-money-laundering controls and insufficient remediation | $17.7 billion; No. 20 | The action concerned Deutsche Bank and U.S. affiliates |
| Goldman Sachs | 2024 CFPB Apple Card order; older 1MDB foreign-bribery resolution | $28.9 billion; No. 11 | The CFPB docket was listed as post-order when reviewed |
| HSBC | 2023 CFTC trading and recordkeeping action; 2024 FCA customer-treatment fine | $15.9 billion; No. 22 | The FCA credited extensive redress and remediation |
| JPMorgan Chase | 2024 Federal Reserve action over inadequate monitoring of trading activity for market misconduct | $58.2 billion; No. 1 | Federal Reserve and OCC penalties totaled about $348.2 million |
| TD Bank | 2024 U.S. guilty pleas concerning Bank Secrecy Act and money-laundering violations | $27.5 billion; No. 12 | The coordinated resolution imposed substantial penalties and independent monitoring |
| U.S. Bank | 2022 CFPB action over unauthorized deposit and credit accounts | $17.9 billion; No. 19 | The CFPB terminated the order in 2025 after listed obligations were fulfilled |
| Wells Fargo | 2022 CFPB order covering auto loans, mortgages, and deposit accounts | $42.5 billion; No. 6 | Major CFPB and Federal Reserve actions were later terminated after required conditions were met |
How this review defines unethical banking
No government agency publishes a definitive list of the “most unethical banks.” Ethics also depends on the conduct you consider most important. Some customers prioritize consumer protection and fair fees. Others focus on climate financing, human rights, community lending, financial inclusion, tax conduct, executive accountability, or market integrity.
This review uses four evidence categories:
- Consumer harm: official findings involving unauthorized accounts, deceptive practices, servicing failures, unfair fees, inaccurate reporting, or inadequate dispute handling.
- Financial integrity and governance: criminal resolutions or regulator findings involving anti-money-laundering controls, sanctions compliance, bribery, trading surveillance, market manipulation, or weak risk management.
- Environmental financing: recent bank-group lending and underwriting commitments to fossil-fuel companies, treated as a separate lens rather than proof of illegal conduct.
- Recency and remediation: whether the issue is recent, whether affected customers received redress, and whether regulators later terminated the relevant order.
The climate figures come from an advocacy-led research coalition, not a regulator. Its published methodology covers lending and underwriting commitments and credits banks when they participate in new financing or refinancing. That is useful for comparing bank groups, but it is not the same as proving that your checking-account balance financed a named oil, gas, or coal project.
Nine major banks with documented ethical controversies
This list is illustrative rather than exhaustive. Inclusion reflects the strength and relevance of the public evidence used here, not a claim that these are the only banks with serious controversies.
1. Bank of America
Why it is included: Bank of America has a recent consumer-protection case covering several everyday banking and credit-card practices. In July 2023, the Consumer Financial Protection Bureau said the bank had repeatedly charged insufficient-funds fees on the same transaction, withheld promised credit-card rewards, and opened some credit-card accounts without customer authorization.
The CFPB action against Bank of America required more than $100 million in payments to affected consumers. CFPB and Office of the Comptroller of the Currency penalties totaled $150 million.
On the environmental side, Banking on Climate Chaos attributed $47.3 billion in 2025 fossil-fuel financing to Bank of America, the second-highest total in the report.
Fair context: The enforcement order required the practices to stop and harmed consumers to be compensated. The evidence supports scrutiny of the bank’s record; it does not establish that every current Bank of America product is unsuitable.
2. Citigroup and Citibank
Why it is included: Citigroup’s central issue in this review is the slow remediation of enterprise data and risk-management weaknesses. In July 2024, the Federal Reserve fined Citigroup $60.6 million for violating a 2020 enforcement action. The regulator said the company had made insufficient progress on data quality management and had not implemented adequate compensating controls.
The Federal Reserve’s 2024 Citigroup action was coordinated with the OCC; announced penalties totaled about $135.6 million. The release said the 2020 action remained in effect at that time. Because enforcement status can change, readers should check the latest regulator docket rather than assume a 2024 status is unchanged.
Banking on Climate Chaos attributed $45.3 billion in 2025 fossil-fuel financing to Citigroup, ranking it fifth among the 65 banks covered.
What to consider: Data governance may feel remote from a checking account, but weak enterprise controls can affect reporting, compliance, operational resilience, and the accuracy of decisions across a large financial institution.
3. Deutsche Bank
Why it is included: Deutsche Bank appears because of repeated regulatory concern about anti-money-laundering, sanctions, governance, and remediation. In July 2023, the Federal Reserve announced a $186 million fine against Deutsche Bank, its New York branch, and other U.S. affiliates.
The Federal Reserve’s Deutsche Bank action cited unsafe and unsound practices, violations of earlier 2015 and 2017 consent orders, insufficient remedial progress, and deficient controls connected with the bank’s prior relationship with Danske Bank’s Estonian branch.
Banking on Climate Chaos attributed $17.7 billion in 2025 fossil-fuel financing to Deutsche Bank, ranking it twentieth.
Fair context: This section relies on the resolved 2023 enforcement record, not on unproven allegations from later investigations. It also concerns a global banking group and U.S. affiliates, so relevance will vary by country and product.
4. Goldman Sachs
Why it is included: Goldman Sachs has both a recent consumer-finance order and a major historical governance case. In October 2024, the CFPB found that Goldman Sachs Bank USA mishandled Apple Card disputes, made adverse credit reports before completing required billing-error procedures, and misled consumers about Apple Card Monthly Installments.
The CFPB’s Goldman Sachs Bank USA order required $19.8 million in consumer redress and a $45 million civil penalty. The docket was listed as post-order when this article was reviewed.
Goldman also entered a coordinated 1MDB resolution in 2020 exceeding $2.9 billion. The firm and its Malaysian subsidiary admitted involvement in a foreign-bribery conspiracy, and the Malaysian subsidiary pleaded guilty. This is an older case and should be understood as part of the bank’s governance history, not a new allegation.
Banking on Climate Chaos attributed $28.9 billion in 2025 fossil-fuel financing to Goldman Sachs, ranking it eleventh.
5. HSBC
Why it is included: HSBC’s record in this review spans customer treatment and market conduct. In May 2024, the U.K. Financial Conduct Authority fined HSBC entities £6.28 million for failures in the treatment of customers who were in arrears or financial difficulty during 2017 and 2018.
The FCA said HSBC did not always conduct appropriate affordability assessments and sometimes took disproportionate action. The regulator also credited HSBC for identifying the issue, investing £94 million in remediation, and paying £185 million in redress to more than 1.5 million customers.
Separately, a 2023 Commodity Futures Trading Commission order imposed a $45 million penalty on HSBC Bank USA for manipulative and deceptive swaps trading, spoofing, supervision failures, and mobile-device recordkeeping violations during an approximately eight-year period.
Banking on Climate Chaos attributed $15.9 billion in 2025 fossil-fuel financing to HSBC, ranking it twenty-second.
6. JPMorgan Chase
Why it is included: JPMorgan Chase combines a recent market-surveillance action with the highest fossil-fuel financing total in the 2026 climate report. In March 2024, the Federal Reserve fined the firm about $98.2 million for an inadequate program to monitor firm and client trading activity for market misconduct between 2014 and 2023.
The Federal Reserve’s JPMorgan Chase action required corrective work. Penalties announced by the Federal Reserve and OCC totaled about $348.2 million.
Banking on Climate Chaos attributed $58.2 billion in 2025 fossil-fuel financing to JPMorgan Chase, the highest total among the banks covered.
What to consider: A customer choosing a checking account may weigh different factors than an institutional client choosing investment-banking services. Evaluate the specific legal entity and product, while still considering the parent company’s governance and financing record.
7. TD Bank
Why it is included: TD Bank has the most consequential recent anti-money-laundering case in this review. In October 2024, TD Bank N.A. and its U.S. holding company pleaded guilty to Bank Secrecy Act and money-laundering-related offenses and agreed to pay more than $1.8 billion in the Justice Department resolution.
The Justice Department said the bank had pervasive anti-money-laundering deficiencies from 2014 through 2023. It also said 92% of total transaction volume went unmonitored from January 2018 through April 2024 because numerous transaction types were not automatically monitored.
As part of the coordinated action, the Financial Crimes Enforcement Network assessed a record $1.3 billion penalty and a four-year independent monitorship. A separate 2024 CFPB order required $7.76 million in redress and a $20 million penalty over inaccurate consumer credit reporting and related failures.
Banking on Climate Chaos attributed $27.5 billion in 2025 fossil-fuel financing to Toronto-Dominion Bank, ranking it twelfth.
8. U.S. Bank and U.S. Bancorp
Why it is included: U.S. Bank’s consumer-protection case involved unauthorized accounts. In July 2022, the CFPB found that the bank had opened certain deposit accounts, credit cards, and lines of credit without customers’ knowledge and consent and had obtained some consumer reports without a permissible purpose.
The CFPB order against U.S. Bank required a remediation plan and a $37.5 million penalty. In August 2025, the CFPB terminated the order after stating that U.S. Bank had fulfilled listed obligations, including paying the penalty, issuing required redress, and taking steps to implement injunctive relief.
Banking on Climate Chaos attributed $17.9 billion in 2025 fossil-fuel financing to U.S. Bancorp, ranking it nineteenth.
Fair context: The terminated order is material evidence of remediation. A balanced ethics review should record both the original conduct and the regulator’s later determination that the listed obligations had been fulfilled.
9. Wells Fargo
Why it is included: Wells Fargo remains relevant because of the scale and breadth of its consumer harm, even though major regulatory actions have since been terminated. In December 2022, the CFPB ordered Wells Fargo to pay more than $2 billion in consumer redress and a $1.7 billion civil penalty for violations involving auto loans, mortgages, and deposit accounts.
The CFPB’s Wells Fargo docket describes payment misapplication, wrongful vehicle repossessions, improper mortgage-modification denials, incorrect fees, and deposit-account problems. The order covered more than 16 million affected consumer accounts and was later listed as terminated.
In March 2026, the Federal Reserve terminated its 2018 Wells Fargo enforcement action after finding that the bank had met all required conditions. The Fed said remediation spanned nearly a decade, and the asset cap associated with the action had been removed in 2025.
Banking on Climate Chaos attributed $42.5 billion in 2025 fossil-fuel financing to Wells Fargo, ranking it sixth.
What this list does—and does not—prove
- It is not a bank-safety list. A history of misconduct does not by itself show that an institution is insolvent or that insured deposits are at risk.
- It does not trace your dollars one-to-one. Large banks pool funding across deposits, wholesale borrowing, equity, and other sources. Group-level financing data cannot identify what happened to a specific customer’s balance.
- It does not treat every subsidiary as identical. A parent bank can operate different legal entities, products, and regional businesses under separate regulatory regimes.
- It does not freeze conduct in time. Orders can be satisfied or terminated, policies can change, and redress can be paid. Remediation should affect your judgment even when it does not erase the original harm.
- It does not decide your priorities. Branch access, disability accommodations, multilingual support, fees, interest rates, credit availability, and community presence may create legitimate tradeoffs.
How to evaluate a bank before opening an account
1. Confirm deposit or share insurance first
For a U.S. bank, confirm the institution in the FDIC BankFind Suite. Standard FDIC coverage is $250,000 per depositor, per insured bank, for each ownership category. For a credit union, confirm federal insurance through the NCUA Credit Union Locator; federally insured credit unions generally provide at least $250,000 in share insurance, with coverage depending on ownership structure.
Deposit insurance protects eligible deposits if an institution fails. It does not certify that a bank is ethical, protect investments such as stocks or mutual funds, or compensate you for every type of fraud or service dispute.
2. Define the conduct that matters most to you
Write down your priorities before comparing institutions. You might focus on fair fees, climate policy, community lending, racial equity, labor practices, privacy, weapons financing, political spending, or transparent governance. Clear priorities make broad ESG principles more useful in a real banking decision.
3. Search official enforcement records
Use the CFPB enforcement database for consumer-finance cases, then check the Federal Reserve, OCC, FDIC, FinCEN, Justice Department, state attorneys general, and relevant non-U.S. regulators. Read the underlying order when possible. A press headline may omit the time period, legal entity, remediation, or current status.
4. Read the fee schedule and product disclosures
An institution with a strong mission can still be a poor fit if it charges avoidable monthly fees, has weak fraud support, lacks nearby branches, or offers an uncompetitive savings rate. Compare minimum balances, overdraft rules, ATM access, wire and transfer fees, customer-support hours, and complaint procedures. Readers who need low-cost access should also compare the best banks for low-income earners.
5. Verify ethical labels instead of accepting marketing language
- CDFI certification: The U.S. Treasury’s CDFI Fund certifies specialized organizations that provide financial services in low-income communities and to people who lack access to financing. The correct term is Community Development Financial Institution.
- B Corp certification: B Lab verifies a company against social, environmental, governance, transparency, and accountability standards. Certification is a useful signal, not a guarantee that every lending decision matches your values.
- GABV membership: The Global Alliance for Banking on Values is a membership network with eligibility and assessment criteria. It is not a government certification.
6. Evaluate the exact product and legal entity
A parent company’s record matters, but your mortgage servicer, card issuer, investment affiliate, and deposit-taking bank may be different legal entities. Review product-specific evidence. For example, a bank that meets your checking needs may not be the best choice among ethical mortgage lenders.
7. Give remediation real weight
Look for redress, management changes, independent monitoring, revised incentives, audit results, and termination of enforcement orders. A bank should not receive a permanent clean slate merely because time passed, but an ethics review becomes unfair if it ignores verified corrective action.
How to switch banks without missing a payment
Moving an account is manageable when you treat it as a controlled transition rather than a same-day shutdown.
- Open and test the new account. Confirm insurance, identity verification, transfer limits, debit-card access, and any minimum balance or direct-deposit requirement.
- Download records from the old bank. Save recent statements, tax forms, payee details, and records for any active dispute, chargeback, loan, or warranty claim.
- List every recurring transaction. Review at least several months of activity for payroll, benefits, subscriptions, utilities, rent, taxes, insurance, loan payments, peer-to-peer transfers, and annual renewals.
- Redirect income first. Move payroll and benefit deposits, then wait until at least one payment arrives correctly in the new account.
- Move automatic payments. Update merchants one by one and record the confirmation date. Leave a buffer in the old account for delayed debits, outstanding checks, refunds, and reversals.
- Run both accounts in parallel. Keep the old account open through at least one full billing cycle—or longer if you have infrequent annual charges—while watching for unexpected activity and maintenance fees.
- Transfer the remainder and close deliberately. Obtain written confirmation, destroy unused checks and cards, remove the old account from payment apps, and retain the final statement.
Better-aligned banking alternatives
A better-aligned bank is one that meets your practical needs while providing credible evidence for the values it claims. Useful places to look include:
- Certified CDFI banks and credit unions that focus on underserved people and communities.
- Federally insured credit unions with transparent governance, reasonable fees, and membership eligibility you can meet.
- Certified B Corp banks whose certification is current and applies to the relevant operating company.
- Global Alliance for Banking on Values members that publish clear impact and lending information.
- Community and minority depository institutions that demonstrate strong local lending and service rather than relying on vague purpose-driven branding.
None of these labels eliminates the need to compare insurance, rates, fees, branch access, digital security, customer support, and product availability. Start with the site’s researched list of socially responsible banks, then verify the current details directly with each institution.
The bottom line
Do not outsource a personal values decision to a dramatic headline or a single ranking. Start with verified conduct, distinguish illegal behavior from lawful but contested financing choices, and account for remediation. Then compare the specific account on safety, cost, access, and service.
If your bank repeatedly conflicts with your priorities and a credible alternative meets your financial needs, switching can be a reasonable way to align your money with your values. The impact of one account is difficult to quantify, but the decision can still reduce your support for a business model you reject and add to broader customer pressure. Apply the same balanced thinking to the pros and cons of socially responsible investing.
Frequently asked questions
What makes a bank unethical?
A bank may raise ethical concerns through documented consumer harm, deceptive or discriminatory conduct, weak financial-crime controls, market manipulation, bribery, harmful financing, poor governance, or failure to correct known problems. No single issue or certification creates a universal ethics score.
Which bank is the most unethical?
There is no objective universal answer because different methods measure different conduct. In this review, TD Bank has the most consequential recent anti-money-laundering case, while JPMorgan Chase has the highest 2025 fossil-fuel financing total in the Banking on Climate Chaos report. Those are different ethical categories and should not be treated as one ranking.
Is my money safe at a bank with scandals?
A misconduct record and deposit safety are separate issues. In the United States, verify that the deposit-taking bank is FDIC insured or that the credit union is federally insured by the NCUA, and keep balances within the coverage rules for your ownership category.
How can I find a more ethical bank?
Start with federal deposit or share insurance, then review official enforcement records, fees, lending and underwriting policies, community impact, product access, and verified designations such as CDFI certification, B Corp certification, or GABV membership. Treat every label as a screening signal rather than a guarantee.
Does switching banks make a difference?
Switching can align your banking relationship with your values and contribute to customer and market pressure, but its direct effect is difficult to isolate. A consumer deposit cannot usually be traced to a specific loan or project, so avoid exaggerated claims about the impact of one account.
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