U.S. banks may soon collect citizenship data from customers

bix6

I don’t really understand this. We already run KYC / AML. Is that not good enough for some reason?

nemomarx

> Banks are required to collect information through “know your customer” rules, but have pushed back against this plan. But Bessent told CNBC, “If Treasury and the banking regulators say it’s their job, it’s their job.” Well I can't see this ending well. It's either more invasive KYC or it's a push towards debanking people out of favor with the government again.

fred_is_fred

I am surprised that this isn't already part of KYC.

zulux

Pretty normal in other places: Most banks in Japan are for Japanese customers. Foreign users have quite a few hoops to jump through.

adolph

An interesting aspect to changes like this is that they demonstrate the silos and fissures between various government functions. There isn't already a standard intra-government API that for an identify returns the relationship person has to the US government (i.e. citizen, legal resident, visa like student or H1B?

kylehotchkiss

So can they stop being so anal about “home addresses” so people traveling abroad for a few months don’t have to stress?

jmclnx

I cannot get to that link, here is another one. The main part to remember is " may ". The cost of this process could prevent the order from being issued: https://www.businessinsider.com/banks-requirement-citizenshi... An interesting quote: > Dissuading people from banking was "one of the more predictable outcomes," Braunegg said, adding that could include people ... and dual citizens who are "wary of cross-border reporting."

josefritzishere

This seems to be a debanking scheme. Debanking schemes are just a way to steal peoples savings of course. Deutsche Bank did the same from 1933 to 1945 in Germany.

guywithahat

Which is how most of the world does it. What is interesting is that in 2023 the CFPB/DOJ started threatening to sue banks if they relied on immigration status/duration of stay to approve loans, which was generally regarded as threatening banks not to consider immigration status for loans. There is a risk that if they use this information the next president in the white house may try to sue them, however if they don't use immigration information then they'll be left stranded with a bunch of bad loans. It's probably better that they have this information but it is a bit of a lose-lose

bradley13

The US forced stuff like this - and much more - on other countries, with FATCA. Just one example: Foreign banks must report all financial activities of Americans to the US. An American official wad asked in an interview if the US would then report financial activities of non-Americans to their home tax authorities. The answer was "lol, no, that would be too much effort". I am having a moment of Schadenfreude...

b8

I already have to upload my real ID and had to hop on a video call to show my face + ID for one bank.

runako

Since others are not saying it, enforcing this will immediately cause havoc as any number of citizens do not have ready access to any document proving citizenship. (Non-US people note that this is likely a major difference between the US and your country. The US does not compulsorily provide proof of citizenship to its citizens that can be used at places where one is typically asked to prove one's citizenship.) Bessent notes here that Real ID would not be considered valid ID for this purpose, which sounds like it will have the same problems as the SAVE act. This could mean debanking anyone who has changed their name and does not have a notarized copy of the name change certificate, and most people who do not drive. (I am not sure how it would handle minors, who generally do not have any photo ID. Would they have to come in to provide ID when they turn 18?) The underlying idea is fine, but it creates problems when combined with the reluctance to issue any kind of national ID.

alibarber

Having opened accounts in two different European countries, the more surprising thing here for me is that the US banks _didn’t_ already do this.

0xbadcafebee

Don't let commenters convince you this is normal. This is a concerted effort by Republicans to win the midterm elections. It's a very old Republican tactic: disenfranchise poor ethnic communities that would vote Democrat. > The planned EO is one more plank in President Donald Trump’s broader effort to tie his immigration policy to collection of information in the United States, including for voting and Census efforts. As usual for a Republican agenda, it hurts the economy in order to achieve its ideological goals. > In addition to legal questions, some policy experts and banks have warned about damage to the economy if people are denied access to the banking system and deposit accounts, as well as potentially big increases in administrative costs for banks. [...] Allowing noncitizens, including undocumented immigrants, to legally open bank accounts using documentation, such as an ITIN, means they can pay taxes and avoid being part of the “unbanked” existing in a purely cash economy. Being unbanked is often associated with less ability to move up the social ladder and contribute to economic growth.

gla67890543

This data collection is not for immigrants. most people they just come, work and leave. Sooner or later all those Maga clowns understand, this is all about controlling them.wait for the results until they integrate everything into Palantir.

exabrial

I think bank's KYC is fine, and I have no issues with making this more strict. After Equifax hired a music major for their Chief Security Officer and leaked everyone's information for free, I had someone open a bank account in my name. Luckily I caught it and got it shut down. I was not reimbursed by Equifax for the giant pain in the ass this was.

negura

avoiding this is one of the use cases for cryptocurrencies

chrismcb

Personally I think the American banking system is garbage. The technology is awful. But the government requirements are too onerous and potentially unconstitutional. The government doesn't need to know who I am, the bank doesn't need to know the customer.