Quick Hits
- On June 5, 2026, FinCEN and several other federal agencies issued a joint advisory highlighting fraud typologies and suspicious activity linked to unlawful employment and employers, including immigration-related schemes.
- The Treasury Department is expected to propose revisions to the Bank Secrecy Act related to customer due diligence requirements, as well as updates to customer identification program rules to address foreign consular identification cards.
- On June 8, 2026, the CFPB issued a statement reminding creditors that a consumer’s immigration status, lawful presence, employment authorization, and factors that may indicate risk of removal may be considered as part of a lender’s ability-to-repay analysis, tying these factors to credit underwriting decisions.
Executive Order 14406, titled “Restoring Integrity to America’s Financial System,” signals increased federal scrutiny of banking activity that may be linked to unauthorized employment, employers of non-work authorized individuals, tax and identity fraud, and cross-border movement of funds. The executive order directs agencies such as the U.S. Department of the Treasury, the Financial Crimes Enforcement Network (FinCEN), and the Consumer Financial Protection Bureau (CFPB) to review existing rules and consider additional measures or changes to the implementing regulations of the Bank Secrecy Act (BSA). As a result, banks and other financial institutions have received additional guidance and advisory statements from federal agencies and regulators, and these institutions should expect greater focus on immigration-related factors in their compliance and risk management programs.
Several agencies have already taken initial steps to implement the executive order’s objectives. On June 5, 2026, FinCEN, the Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), National Credit Union Administration (NCUA), and Internal Revenue Service (IRS), issued a joint advisory outlining potential warning signs associated with unlawful employment schemes. These include the use of stolen identities, shell companies, off-the-books payroll practices and payroll tax evasion, staffing arrangements, and the use of foreign identity documents or Individual Taxpayer Identification Numbers (ITINs), as they may be designed to conceal unauthorized workers and related unlawful activity.
Treasury is also expected to propose regulatory updates to customer due diligence and account-opening requirements, including potential changes affecting customer identification program requirements and the use of foreign consular identification cards. While FinCen’s joint advisory provides nearly twenty examples of red flag indicators related to fraud schemes associated with unauthorized employment of foreign nationals, including some related to the use of ITINs, it reminds financial institutions that a red flag should not be considered in isolation and that no customer type presents a specific level of risk or risk profile.
The administration’s focus also extends to consumer lending. In a June 8, 2026, statement, the CFPB reminded lenders that existing law requires them to assess a consumer’s ability to repay prior to offering mortgages and other types of credit. The CFPB noted this obligation may include considering a borrower’s immigration status and employment authorization if those factors could affect future income, particularly if removal from the United States could impact the borrower’s income. For example, a lender may consider an individual’s immigration status, lawful presence, and work authorization as factors that might indicate risk of removal, as it relates to a borrower’s income from employment and repayment capacity. The CFPB also reminded lenders that there are a variety of immigration statuses and emphasized that lenders cannot assume different statuses have the same ability to pay.
Key Takeaways
Employers and foreign nationals may encounter additional questions or documentation requests when opening accounts or applying for credit, particularly where immigration-related factors are relevant to a bank’s risk assessments, due diligence, and identification obligations.
Employers should monitor upcoming regulatory developments and may want to consider reviewing workforce and identity verification practices in anticipation of heightened scrutiny.
Ogletree Deakins’ Financial Services Industry Group and Immigration Practice Group will continue to monitor developments and will post updates on the Immigration blog as additional information becomes available.
For additional insight into the critical immigration issues facing employers today, please join our Virtual Immigration Insights Symposium on Wednesday, October 7, 2026, from noon to 2:30 p.m. ET. Register here.
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