The purpose of this executive order is to address the risks associated with exploitation of the United States financial system by nonwork authorized populations and their employers and is aimed at preventing the extension of credit and financial services to the inadmissible and removable alien population of the United States. Activities that are indicative of such exploitation of the financial system include patterns of payroll tax evasion by employers or labor brokers, including (a) the failure to withhold or remit federal employment taxes for nonwork authorized individuals; (b) the utilization of foreign identity documents, nominee accounts, shell companies or complex “funnel” structures designed to hide the identity of the ultimate beneficial owners who conceal the true nature of payroll disbursements; (c) the strategic use of unregistered money services businesses, third-party payment processor or peer-to-peer platforms to facilitate off the books wage payments, and then bypass the Bank Secrecy Act; (d) patterns of repetitive, sub-threshold cash withdrawals or deposits that correlate with payroll cycles conducted outside of regulated payroll processing systems; (e) financial activity indicative of labor trafficking or forced labor where proceeds are commingled with legitimate business revenue, or transferred to foreign jurisdictions; and (f) use of individual taxpayer identification numbers to obtain credit products or open depository accounts where applicant lacks verified lawful immigration status.

Within 90 days of the date of the order, the secretary of the treasury shall propose changes to applicable implementing regulations of the Bank Secrecy Act to strengthen risk-based customer due diligence requirements for covered financial institutions. The changes should ensure that institutions (a) collect and verify sufficient customer identity information to reasonably identify the nominal and beneficial owners of accounts and (b) maintain the authority to obtain additional information necessary to resolve material compliance concerns, including information relevant to whether the account holders possess lawful immigration status and employment authorization in the United States. Within 180 days of the order, the secretary of treasury is also directed to consider changes to applicable implementing regulations of the Bank Secrecy Act.

Finally, within 60 days of the order, the Consumer Financial Protection Bureau is to consider clarifying that potential deportation and loss of wages are factors that could adversely affect a nonwork authorized borrower’s ability to repay an extension of credit under the ability-to-repay standards in 12 CFR Part 1026; and each appropriate federal functional financial regulator shall issue guidance regarding the management of potential credit risks posed by the nonwork authorized population.