According to a report by the nonprofit Free Press, amplified by CBS News coverage, former President Donald Trump privately urged banking executives to notify authorities about customers he believed were engaged in "domestic terrorist activity." The request, as described by the reporting, pressed financial institutions to use existing reporting channels to flag individuals and groups tied to political violence or extremist activity.

Banking compliance already requires institutions to file suspicious activity reports under the Bank Secrecy Act, a regime administered by the Treasury Department’s Financial Crimes Enforcement Network. Those reports are intended to detect money laundering, terrorist financing and other financial crimes. But legal experts and civil liberties advocates say the request described in the reporting would cross into politically charged territory if it directed banks to evaluate and report on constitutionally protected speech or lawful protest.

"Financial surveillance can quickly become a tool of political control if it is used to target dissent," said a civil liberties attorney not involved in the reporting. "The word 'terrorist' carries potent stigma and very specific legal weight; using it as a broad label risks chilling lawful assembly and expression."

The U.S. Code contains a definition of domestic terrorism in 18 U.S.C. § 2331, but there is no standalone federal offense labeled simply "domestic terrorism" that applies across the board. Prosecutors typically charge underlying criminal acts — such as weapons offenses, arson or assault — rather than bringing a charge under a single domestic-terrorism statute. That ambiguity is central to the constitutional dispute: who decides when political or protest activity crosses the line into reportable conduct?

A former Treasury official, speaking on background, cautioned that banks are bound by narrowly tailored legal obligations and that compliance units are trained to distinguish criminal conduct from protected activity. "Banks can't become a political policing arm," the official said. "Their reporting must be tied to financial indicators of wrongdoing, not political views."

The potential targeting of individuals by political criteria has drawn swift criticism beyond domestic borders. International observers and human-rights organizations noted that using financial systems to monitor and suppress domestic dissent is a hallmark of authoritarian regimes. "When democracies lean on banks to stifle political opponents, it undermines rule-of-law credibility globally," said a human-rights analyst who tracks financial sanctions and civil liberties.

The White House and the former president's team did not provide immediate comment to CBS News. Banking trade groups, according to the report, have historically warned about the reputational and legal risks of being asked to act on vague political directives.

Legal scholars expect rapid scrutiny if the administration or any agency attempts to formalize such guidance. Congress could pursue oversight hearings, and affected individuals or civil-rights organizations might seek injunctions in federal court, arguing violations of the First Amendment and due process.

For global markets and foreign governments, the episode underscores a broader concern: the integrity of U.S. financial institutions as impartial actors in the international system. Whether the matter becomes a legal test or a political flashpoint, it spotlights the fragile balance between security, civil liberties and the norms that sustain democratic pluralism.