WASHINGTON—The Trump Administration is discussing a dramatic expansion of the role of the U.S. banking system in federal immigration enforcement, news outlets are reporting.
According to The Wall Street Journal, officials within the Treasury Department have been weighing a possible executive order or similar action that would require financial institutions to collect customers’ citizenship information — potentially including passports or other proof of citizenship — both for new account holders and existing customers.
Under current U.S. rules, FIs already gather identifying information to comply with anti-money-laundering “Know Your Customer” (KYC) requirements, but they are not specifically required to verify or record a customer’s citizenship or immigration status. What’s being discussed, however, would go beyond established practices and could create barriers to accessing basic banking services, industry experts warn.
White House officials have publicly pushed back on the reports, with a spokesman calling unannounced policy speculation “baseless.” Nonetheless, the discussions have alarmed both banking executives and consumer advocates, who say such mandates could be costly, complex to implement, and potentially discriminatory in practice, Semafor reported.
The broader context for these deliberations appears to be the Administration’s ongoing immigration enforcement agenda, which in recent months has included expanded citizenship vetting on federal forms and other initiatives aimed at reducing unlawful presence in the U.S.
On social media — including on platforms like Facebook and Reddit — commenters and industry observers highlighted concerns about how such a policy might affect millions of residents, including legal non-citizens and small-business owners who depend on basic banking access. Discussions also questioned whether an executive branch directive could compel compliance without new legislation from Congress.
The Defense Credit Union Council emphasized that CUs already comply with extensive federal requirements under the Bank Secrecy Act, AML, and Know Your Customer rules.
"Our institutions verify identity, monitor risk, and report suspicious activity as required by law and they do so with a strong record of compliance," stated DCUC Chief Advocacy Officer Jason Stverak. "If policymakers pursue additional customer documentation requirements, it is essential that any changes be carefully tailored, legally sound, and developed in close coordination with regulated institutions, particularly small credit unions that operate with limited compliance resources."
Stverak noted that defense credit unions serve servicemembers, veterans, and their families who depend on timely access to financial services.
"Any new mandate must avoid unintended barriers to lawful account access and must account for operational costs, cybersecurity implications, and implementation complexity," he said. "DCUC stands ready to work constructively with the Administration and Congress to ensure that any regulatory changes are proportionate, feasible, and appropriately calibrated to institution size and risk."