# Trump Orders Banks to Check Citizenship

**Published:** 2026-05-20T01:04:00.000Z  
**Topic:** Banking  
**Sentiment:** neutral  
**Publisher:** TrendWatcher — https://www.trendwatcher.in/article/f96f3880-617f-414b-a8e6-0fdf38450554

Trump signs executive order requiring banks to scrutinize clients' citizenship, potentially affecting 5,000 to 6,000 mortgages, amid immigration enforcement

President Donald Trump signed an executive order that requires banks to take a closer look at the citizenship of their customers, a new measure in his administration's push to clamp down on people living in the country illegally [1]. The order directs bank regulators and government departments to look for signs that people without legal status are opening accounts or obtaining loans or credit cards, and could lead to an increase in the number of "unbanked" individuals.

| At a glance | |
|---|---|
| Number of mortgages issued to customers with ITINs | 5,000 to 6,000 |
| Type of identification used by undocumented workers | Individual Taxpayer Identification Numbers (ITINs) |
| Reaction of banks to the executive order | Less aggressive than expected, with banks able to avoid mandatory collection of citizenship information |

## Background on the Executive Order
The White House has been signaling for weeks that it was planning some sort of executive order that would involve how banks handle their undocumented customers [2]. Treasury Secretary Scott Bessent said last month that "there should be stricter rules" to open bank accounts, and claimed that bank executives were supposed to "know your customer" [1]. The banking industry had been aggressively lobbying for months to stop the White House from issuing an executive order that would have made collecting customers' citizenship status mandatory, arguing it would be expensive and require vast amounts of paperwork [3].

The order is less aggressive than banks had expected, as earlier reports suggested the White House was drafting an order that would make collecting customers' citizenship information mandatory [2]. Since banks have never collected any information about their customers' citizenship or immigration status, there are no reliable public figures on how much risk these customers pose to the financial system [1]. A study by the left-leaning Urban Institute estimated that banks were highly reluctant to lend to individuals with ITINs, and that Fannie Mae and Freddie Mac are also generally reluctant to insure mortgages for borrowers with an ITIN [1].

## Impact on the Financial System
The White House has taken other measures to discourage undocumented workers from using the financial system, including reclassifying certain refundable tax credits as "federal public benefits" [2]. Tax experts said immigrants brought to the U.S. illegally by their parents as children, known as Deferred Action for Childhood Arrivals, or DACA, recipients, and immigrants with Temporary Protected Status would be largely affected by the planned change [1]. The executive order could lead to a decrease in the number of loans and credit cards issued to undocumented immigrants, and could also lead to an increase in the number of "unbanked" individuals.

## What to Watch
* The reaction of the banking industry to the executive order, and whether they will implement stricter rules for opening bank accounts
* The impact of the executive order on the number of "unbanked" individuals, and whether it will lead to an increase in alternative financial services
* The potential effects on the financial system, including the risk of loans not being repaid if undocumented immigrants are deported

The real significance of the executive order lies in its potential to affect the lives of thousands of undocumented immigrants, and to change the way banks interact with their customers. As the banking industry and regulators work to implement the order, it remains to be seen how it will impact the financial system and the broader economy.

## Sources
1. Nbcnews — [Trump orders banks to take a closer look at clients ...](https://www.nbcnews.com/news/us-news/trump-orders-banks-take-closer-look-clients-citizenship-new-immigratio-rcna346070)
2. AP News — [Trump orders banks to take a closer look at clients ...](https://apnews.com/article/trump-immigration-banking-citizenship-treasury-08eecd2738bb0b454dce1152492bc3e2)
3. Fox Carolina — [Trump orders banks to take closer look at clients’ citizenship in new immigration enforcement move](https://www.foxcarolina.com/2026/05/20/trump-orders-banks-take-closer-look-clients-citizenship-new-immigration-enforcement-move/)

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Cite as: TrendWatcher, "Trump Orders Banks to Check Citizenship", https://www.trendwatcher.in/article/f96f3880-617f-414b-a8e6-0fdf38450554