Trump signs executive order requiring banks to tighten nationality checks on customers

On 19 May 2026, United States President Donald Trump signed an executive order requiring the banking system to tighten checks on customers’ nationality. According to the text released by the White House, the order directs banking regulators and federal departments to review indications that people without lawful status are opening accounts, taking out loans or applying for credit cards.

Scope of the order

The order does not require banks to collect nationality information from every customer, making it considerably softer than an earlier draft reported in the American press. According to the Associated Press, financial institutions had lobbied against a mandatory approach, arguing that it would be costly, create a paperwork burden and risk pushing millions of customers — American citizens among them — out of the banking system for want of a passport or proof of nationality.

The White House argues that banks face credit risk if a customer is deported and a loan cannot be repaid. The document states that the administration will not “allow risks to the financial system to arise from the extension of credit or financial services to foreign nationals who are inadmissible and subject to removal”.

The order also directs the United States Treasury to consider amending rules under the Bank Secrecy Act so that financial institutions can more easily collect customer data, including immigration status and work authorisation.

Context and reaction

Speaking to reporters a month before the order was signed, United States Treasury Secretary Scott Bessent said “tighter rules are needed” on the opening of bank accounts. According to NBC News, Mr Bessent questioned how “foreign nationals of unknown identity” were able to open accounts, citing the know your customer principle that bank executives are required to follow.

Because the American banking system has never collected information on customers’ nationality or immigration status, there are no public figures on the level of risk this group poses to the financial system.

Research by the Urban Institute estimates that between 5,000 and 6,000 mortgages have been issued to customers using an Individual Taxpayer Identification Number (ITIN) — the number typically used by undocumented workers in place of a Social Security Number. The same organisation notes that Fannie Mae and Freddie Mac generally limit insurance on mortgages held by ITIN users, making home credit harder for this group to obtain.

Immigrant rights organisations argue that any mandatory collection of nationality information could push undocumented immigrants out of the financial system, increasing the number of people without a bank account.

Related developments at the Treasury

The new order follows a series of other administration measures restricting undocumented workers’ access to the financial system. In November 2025, the United States Treasury announced plans to reclassify certain refundable tax credits as “federal public benefits”, thereby excluding a section of immigrant taxpayers from eligibility even though they pay tax in full.

According to tax specialists cited by the Associated Press, those chiefly affected are people brought into the United States unlawfully as children under Deferred Action for Childhood Arrivals (DACA) and those protected under Temporary Protected Status. The order of 19 May 2026 does not change the position of holders of aUnited States permanent resident cardor of American citizens.