Recent reports indicate that the Trump Administration is actively exploring an executive order that would require financial institutions to collect proof of citizenship from customers, a move that could have significant implications for credit unions and the broader financial services industry.
According to statements from Treasury officials, the proposal is “in process” and would potentially require banks and credit unions to collect documentation such as passports or birth certificates from both new and existing account holders.
At this time, no executive order has been formally issued, and key details – including scope, implementation, and legal authority – remain unclear.
What this could mean for credit unions
If implemented, this type of requirement would represent a major shift from current compliance practices.
Today, credit unions follow “Know Your Customer” (KYC) and Bank Secrecy Act (BSA) rules focused on verifying identity – not citizenship status. A new requirement could:
- Add significant operational and compliance burden
- Require system and process changes for onboarding and existing accounts
- Potentially impact member access to financial services
- Raise legal and regulatory questions around authority and implementation
Industry experts have also noted that such a policy could blur the line between financial regulation and broader federal enforcement efforts.
What credit unions should do now
While no action is required at this time, credit unions should:
- Stay informed as details continue to develop
- Monitor guidance from regulators and national partners
- Be prepared for potential compliance changes if the proposal advances