Trump Tightens Financial Access for Non-Citizens

(SeaPRwire) –   President Donald Trump is tightening access to financial systems for non-citizens as part of his Administration’s wider immigration crackdown.

On Tuesday, Trump signed an executive order called “Restoring Integrity to America’s Financial System,” directing banks to factor a customer’s immigration status into financial risk assessments.

The order instructs the Treasury Secretary and federal financial regulators to issue guidance for banks on identifying customers whose profiles or transactions may indicate risks such as money laundering, terrorism financing, and labor trafficking under the 1970 Bank Secrecy Act. The changes aim to address “the risks foreign consular identification cards pose to the integrity of the United States financial system,” according to the order.

The order outlines “red flags and typologies” tied to suspicious activity, including repeated cash withdrawals, use of shell companies to hide true account ownership, and use of certain platforms for off-the-books wage payments.

Additional “red flags” include using an individual taxpayer identification number (ITIN)—available to anyone regardless of immigration status for tax filing and payment—instead of a Social Security number when opening accounts or conducting certain banking actions.

The measure could make it harder for non-citizens, particularly undocumented immigrants, to obtain financial services even for legitimate purposes. The Administration has intensified enforcement on both legal and illegal immigration, conducting large-scale detentions and deportations that have included people with lawful status, increasing scrutiny of visa and citizenship applications, and limiting immigrants’ access to public services. Large-scale immigration raids have sparked nationwide protests, some of which have resulted in deaths involving federal agents.

The Treasury Department also announced plans in November to reclassify certain refundable tax credits as federal public benefits, restricting eligibility for some non-citizens filing taxes in the U.S.

“President Trump is taking action to restore integrity to America’s financial system, cracking down on illicit activity that threatens national security and ending the extension of credit to high-risk borrowers that American citizens are forced to subsidize,” a White House fact sheet on the order states. “Restoring sound underwriting standards puts money back in the pockets of law-abiding Americans.”

The fact sheet argues that “gaps in customer identification practices have allowed terrorists, drug traffickers, money launderers, and other criminal networks to exploit U.S. financial institutions to move illicit funds and evade law enforcement,” citing documented Chinese-linked money laundering networks.

The White House also cited cases of banks providing mortgages, credit cards, and loans to undocumented immigrants and employers underreporting wages for undocumented workers, claiming the associated “costs are passed on to American consumers in the form of higher fees and interest rates.”

The degree to which these activities raise banking fees and interest rates for ordinary Americans remains unclear. Economists generally attribute higher rates to benchmark rates that balance inflation and job growth, bank funding costs, and individual factors such as borrower credit scores. A left-leaning Urban Institute study estimated that 5,000 to 6,000 mortgages were issued to customers with ITINs. Banks are typically reluctant to lend to ITIN holders, and Fannie Mae and Freddie Mac generally avoid insuring mortgages for such borrowers, according to the Associated Press.

The order also directs the Treasury to consider Bank Secrecy Act regulatory changes that would let financial institutions more easily collect customer data, including immigration status and employment authorization.

The Trump Administration had earlier weighed a stricter proposal requiring banks to collect citizenship details from new and existing customers. Financial leaders largely opposed it, warning it would be burdensome and costly. Critics argued it risked “debanking” millions of Americans, as many citizens lack passports or other citizenship documents banks might require, disproportionately affecting elderly, low-income, and rural residents, and could drive consumers away from regulated banks. Analysts shared this concern.

Tuesday’s order marks a pullback after months of targeting major U.S. banks over “political debanking” and customer screening. Trump has repeatedly accused banks of discriminating against conservatives and sued JPMorgan Chase and its CEO for $5 billion over account closures following the Jan. 6, 2021, Capitol attack. JPMorgan Chase said in January, “Our company does not close accounts for political or religious reasons. We do close accounts because they create legal or regulatory risk for the company. We regret having to do so, but rules and regulatory expectations often require it.” Meanwhile, the White House has pursued broader deregulation benefiting non-traditional financial firms and embraced cryptocurrency, with Trump pledging to make the U.S. the “crypto capital of the planet.”