In a move that basically turns your local bank teller into a border patrol agent, President Trump signed an executive order on Tuesday called "Restoring Integrity to America's Financial System." As Conservative Brief reported, this shiny new directive tells financial institutions they need to factor in a customer's immigration status when evaluating potential risks. Because apparently your Wells Fargo branch wasn't stressful enough already.
The order leans on the 1970 Bank Secrecy Act, requiring the Treasury Secretary and federal regulators to help banks spot customers whose profiles might signal sketchy behavior like money laundering, terrorism financing, or labor trafficking. Fair enough on paper. But then it gets into what it calls "red flags and typologies" of suspicious activity, and that's where things get spicy.
Among the supposed warning signs? Repeated cash withdrawals, shell companies hiding who actually owns accounts, and platforms used for under the table wage payments. Oh, and using an Individual Taxpayer Identification Number instead of a Social Security number when opening an account. You know, that ITIN thing the government literally created so people could pay their taxes regardless of immigration status. So the government gave people a number to pay taxes, and now having that number is suspicious. Peak bureaucratic logic.
Critics worry this could make banking even harder for non-citizens, including undocumented immigrants who are just trying to keep their money somewhere safer than a mattress. Meanwhile, the administration has been tightening immigration policy across the board, restricting access to public services, ramping up scrutiny on visa applications, and conducting mass detention and deportation operations that have swept up people with lawful status too. Protests have erupted nationwide over these operations.
A White House fact sheet declared this order would crack down on illicit activity threatening national security and stop banks from extending credit to "high risk borrowers" that American citizens supposedly subsidize. The administration argued that costs from lending to undocumented immigrants get passed along to consumers through higher fees and interest rates. Economists, however, generally point to benchmark rates, bank funding costs, and individual credit scores as the actual drivers of what you pay. But sure, blame the guy with an ITIN and a checking account.
According to research from the left leaning Urban Institute, lenders issued roughly 5,000 to 6,000 mortgages to ITIN holders. Banks already avoid lending to ITIN customers like they avoid free checking accounts, and Fannie Mae and Freddie Mac typically won't insure those mortgages either. So we're talking about a tiny slice of the lending universe here.
Meanwhile, in a delicious twist of irony, Trump has personally sued JPMorgan Chase for $5 billion, claiming they discriminated against conservatives by closing his accounts after January 6th. JPMorgan responded that they close accounts over legal and regulatory risk, not politics. At the very same time, the White House has been deregulating everything in sight and embracing cryptocurrency, with Trump promising to transform America into the "crypto capital of the planet." So traditional banks need more rules, but crypto gets the velvet rope treatment. Makes perfect sense if you don't think about it.
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