❓WHAT HAPPENED: Legislation was introduced to ban illegal migrants from accessing the American banking system.
👤WHO WAS INVOLVED: Senator Tom Cotton (R-AR) and U.S. financial institutions.
📍WHEN & WHERE: Introduced in 2025, targeting U.S. banking system.
💬KEY QUOTE: “Access to the American banking system is a privilege that should only be reserved for those who respect our laws and sovereignty.” – Senator Tom Cotton
🎯IMPACT: Aims to prevent illegal migrants from using financial institutions to remain in the U.S.
Senator Tom Cotton, representing Arkansas, has put forth the Know Your American Customer Act, a legislative proposal aimed at barring illegal migrants from participating in the American banking system.
The proposed act mandates that U.S. financial institutions verify the legal status of new customers, ensuring that American banks do not facilitate illegal migrants in violating U.S. laws.
In a letter addressed to Treasury Secretary Scott Bessent in 2025, Senator Cotton requested a review of the existing rules concerning illegal immigrant access to the U.S. banking system.
The act requires banks and credit unions insured by the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA) to confirm that anyone opening a new account is either a U.S. citizen, a permanent resident, or legally present with a valid visa, using identification such as a driver’s license or passport.
While the legislation would grandfather in existing clients, allowing them to maintain or open new accounts if they have an established relationship with their financial institution, it also criminalizes the act of illegal migrants opening or maintaining accounts, placing legal responsibility on individuals unless institutions fail to verify documentation in good faith.
The logic behind grandfathering in old accounts revolves around getting buy-in from the banking industry, which has objected to fronting the cost of finding existing illegal migrants in their systems.
Join Pulse+ to comment below, and receive exclusive e-mail analyses.