The Trump administration ordered banks and federal agencies to strengthen the review of foreign clients within the US financial system. The measure, presented through an executive order signed this week, seeks for financial institutions to detect possible risks related to people living without legal status in the country.

The document, as revealed by NBC News, instructs banking regulators and government agencies to pay greater attention to accounts, credits, mortgages and financial cards linked to clients whose immigration status may represent, according to the White House, a “financial risk.”

Although the order does not directly require banks to collect the immigration status of each customer, it does open the door to stricter controls and new internal policies within the banking system.

White House argues financial risks

According to the official text, the Trump administration maintains that banks could face economic losses if a person is deported before repaying loans, mortgages or lines of credit.

“The policy of my administration is to protect the integrity of the American financial system,” states the executive order promoted from the White House.

Treasury Secretary Scott Bessent had announced weeks ago that the government considered it necessary to tighten the requirements for opening bank accounts.

“How can you really know a client if you don't know if they have a legal or irregular status?” Bessent questioned in statements reported by US media.

However, the measure was far from the harshest proposal that the financial sector feared. Previous reports indicated that the administration was considering mandating information on citizenship or immigration status, something that was ultimately not included in the executive order.

Banks and migrant advocates react

The banking industry had been lobbying the White House for months to avoid new regulatory obligations. Financial institutions warned that requiring immigration documents could increase costs, generate more bureaucracy and complicate access to banking services for millions of people.

Immigrant advocacy organizations also reacted with concern, warning that these types of policies could push thousands of families out of the formal financial system.

Specialists pointed out to the aforementioned media that many immigrants use the Individual Tax Identification Number (ITIN) to pay taxes, open accounts or request certain financial products, even without having Social Security.

According to data cited by the Urban Institute, between 5,000 and 6,000 mortgages were granted to people with ITINs in recent years, although experts maintain that banks are already extremely cautious with this type of clients.

The new order could also impact beneficiaries of programs such as DACA or Temporary Protected Status (TPS), who depend on the banking system to work, pay taxes and access basic financial services.

Meanwhile, critics of the measure consider that Trump seeks to turn the financial system into another tool of immigration control heading into the midterm elections.