TRUMP SIGNS ORDER DIRECTING BANKS TO REVIEW CUSTOMERS’ CITIZENSHIP STATUS IN IMMIGRATION CRACKDOWN MOVE. (PHOTO).

Trump signs order directing banks to review customers’ citizenship status in immigration crackdown move

   President Donald Trump signed an executive order on Tuesday directing banks and federal regulators to review whether customers may be in the United States without legal status when accessing financial services such as loans, credit cards, and bank accounts.

The order instructs financial regulators and government agencies to look for indicators that individuals without legal immigration status could be using the banking system, framing the effort as part of a broader push to reduce what the administration describes as financial risks tied to deportation. The White House argued that lenders could face losses if borrowers are removed from the country and are unable to repay loans.

The directive stops short of requiring banks to collect citizenship or immigration status from all customers, a step that had been considered more aggressively in earlier discussions. Instead, it offers guidance rather than a strict mandate, easing concerns raised by the banking industry over compliance costs and administrative burdens.

Banks have traditionally not collected citizenship or immigration status data from customers, making it difficult to assess how many account holders or borrowers might be affected. A study cited in policy discussions estimated that a small number of mortgages—roughly 5,000 to 6,000—have been issued to borrowers using Individual Taxpayer Identification Numbers, which are often used by individuals who do not have Social Security numbers. Lending institutions and government-backed mortgage programs have generally been cautious about extending credit to such borrowers.

The administration had signaled for weeks that it was preparing action targeting how financial institutions interact with undocumented immigrants. Treasury Secretary Scott Bessent previously argued that banks should impose stricter standards when opening accounts and raised concerns about verifying customer eligibility.

In response, banking industry groups had reportedly lobbied against any requirement that would force widespread collection of immigration status data, warning it could significantly increase paperwork and operational costs. With the final order stopping short of a mandate, industry officials view the outcome as less burdensome than initially feared.

Immigration advocates have warned that efforts to require or indirectly pressure financial institutions to screen customers based on immigration status could push more people outside the traditional banking system, increasing reliance on cash-based transactions and reducing financial inclusion.

The policy is part of a broader set of actions aimed at limiting access to federal benefits and financial services for individuals without legal status. Previous measures have included changes to how certain tax credits are classified, potentially affecting eligibility for some immigrant taxpayers, including Deferred Action for Childhood Arrivals recipients and individuals with Temporary Protected Status.