SECURING AMERICA’S FINANCIAL SYSTEM: Today, President Donald J. Trump enacted an Executive Order aimed at safeguarding the nation’s financial infrastructure from illicit activities, enhancing customer verification protocols for financial institutions, and addressing the credit challenges associated with providing financial services to unauthorized immigrants.
- The Order instructs the Secretary of the Treasury to issue a formal advisory to financial institutions, highlighting warning signs and suspicious activity patterns linked to payroll tax evasion, hidden account ownership, unreported wage payments, structuring schemes, labor trafficking, and the use of individual taxpayer identification numbers to open accounts or obtain credit without confirmed legal status.
- The Order calls on the Secretary of the Treasury, in collaboration with Federal financial regulators, to suggest amendments to the Bank Secrecy Act regulations to bolster customer due diligence requirements. This includes enhancing the authority to acquire additional information when necessary, ensuring institutions can identify the actual owners of accounts to evaluate risks associated with illegal activities.
- The Order mandates the Secretary of the Treasury and Federal financial regulators to consider revisions to the Bank Secrecy Act to enhance customer identification program requirements, addressing the potential risks posed by foreign consular identification cards to the U.S. financial system.
- The Order directs the Consumer Financial Protection Bureau to evaluate potential changes to regulations to clarify that the risk of deportation and loss of wages could impact a borrower’s ability to repay a loan under “ability-to-repay” standards.
- The Order instructs Federal financial regulators to issue guidance on managing the credit risks involved in extending loans and financial services to unauthorized immigrants without work authorization.
RESTORING BANKING INTEGRITY: President Trump is taking measures to restore integrity within the U.S. financial system by targeting illicit activities that threaten national security and halting the provision of credit to high-risk borrowers, which American citizens ultimately subsidize.
- Flaws in customer identification practices have allowed terrorists, drug traffickers, money launderers, and other criminal networks to exploit U.S. financial institutions to move illicit funds and evade law enforcement. Notably, Chinese money laundering networks have utilized U.S.-based accounts to launder over $312 billion for criminal organizations, including financing human trafficking.
- Financial trend analyses have revealed significant hubs of fentanyl-related illicit financial activity in the U.S. linked to Mexico-based cartels.
- Providing mortgages, credit cards, and auto loans to unauthorized immigrants facing potential deportation or wage loss introduces structural credit risks that threaten the stability and security of the national banking system.
- Employers of unauthorized immigrants may underreport wages and evade payroll taxes, distorting the income data essential for credit underwriting and obscuring risks across the financial system.
- When banks are compelled to absorb these heightened credit risks, the resulting costs are transferred to American consumers through increased fees and interest rates. Reinforcing sound underwriting standards returns money to the wallets of law-abiding Americans.
MAKING AMERICA THE FINANCIAL INNOVATION CAPITAL OF THE WORLD: President Trump is taking steps to ensure America retains its position as the global leader in financial innovation.
- President Trump signed an Executive Order to ensure Federal regulators do not advocate policies that allow financial institutions to deny or restrict services based on political beliefs, religious beliefs, or lawful business activities, thereby guaranteeing fair access to banking for all Americans.
- The Trump Administration conclusively ended Operation Choke Point 2.0 by working to stop regulatory measures that deny banking services to the digital assets industry.
- President Trump signed an Executive Order to ensure that every American planning for retirement has access to funds that incorporate investments in alternative assets.
- President Trump enacted the GENIUS Act into law, a landmark piece of legislation set to position the United States at the forefront of the global digital currency revolution.
