Back to the list

This San Diego bank’s client list is a who’s-who of questionable characters in crypto and beyond

source-logo  cryptoslate.com 10 October 2023 07:30, UTC

A recent Protos report reveals a series of business relationships between San Diego-based Axos Bank and a string of characters who have found themselves subject to regulatory or prosecutorial ire.

Axos Bank—the direct bank affiliate of Axos Financial, based in Las Vegas, Nevada—has maintained business relationships with a variety of individuals and entities who have drawn the scrutiny of regulators, prosecutors, and in some cases, the courts.

Axos has maintained relationships with Binance.US and BAM Trading, the parent company of Binance.US, even as the companies face a string of legal challenges. Binance.US and BAM Trading held over 10 accounts with a startling $377 million in customer funds at Axos as of May 2023.

Axos also offers a service called AxPay that enables crypto companies to bypass the Federal Reserve’s bank wire system. An intrabank funds transfer system, AxPay is similar to offerings by banks such as Signature Bank and Silvergate, both of which shuttered this year.

While Axos has consistently downplayed its engagement with the crypto industry in its quarterly filings, it started accepting Binance US-related deposits in January 2023, further muddying the waters around its actual crypto exposure.

Beyond crypto

Axos’ high–profile clients extend beyond its crypto dealings. It has acted as the financial institution for Alex Jones, a well-known conspiracy theorist and the face of InfoWars, a brand owned by Jones’ Free Speech Media, which also had accounts at Axos. The bank shut down those accounts in September 2023, citing unauthorized transactions as the reason for this sudden decision.

Another controversial client in Axos’ book of business is former U.S. president Donald Trump. According to a July report in the Washington Post Axos Bank’s CEO, Gregory Garrabrants, personally approved loans worth $225 million to Trump after multiple financial institutions had severed ties with Trump following the January 6th, 2021 attack on the United States Capitol.

Axos’ loans helped stabilize Trump’s post-presidential finances, enabling him to mount a potential campaign for the 2024 presidential nomination. Regarding the decision to extend credit to the former president, Garrabants told the Post that he was confident in their profit-generating potential and denied favoritism as a determining factor.“It wouldn’t matter if I was friends with someone, I’m not going to make a loan that’s no good,” he told the Post. “I don’t like anyone that much.”

The series of unique relationships Axos Financial has fostered has invited attention to the bank’s business strategies and risk evaluation methods. As the crypto industry continues to grow and mature, the practices and operations of banks like Axos Financial are likely to be topics of ongoing discussion and analysis.