CFPB ADVISES LENDERS TO WEIGH IMMIGRATION STATUS

On June 5, 2026, the Consumer Financial Protection Bureau told lenders they may need to consider a borrower’s immigration status when judging whether that person can repay a mortgage or credit card, following a May 19, 2026 executive order from President Donald Trump. The statement admits it has no legally binding effect, and the National Consumer Law Center (NCLC) called it “clear as mud.”

The bureau, which is led by Russell Vought, said Truth in Lending Act ability-to-repay rules may call for a look at immigration status, especially where removal from the country could disrupt a consumer’s income. It also said lenders do not have to account for income changes that “cannot be reasonably anticipated.”

Then came the line that gave the whole thing away. The statement says “it has no legally binding effect,” NCLC reported.

The executive order behind it

The order, titled “Restoring Integrity to America’s Financial System,” was signed on May 19, 2026, according to a White House fact sheet. It told the CFPB to consider changing its regulations to make clear that possible deportation and lost wages could factor into ability-to-repay assessments. It also told the Treasury Department to put out an advisory listing red flags and suspicious activity patterns.

NCLC described the order as an effort to cut huge numbers of immigrants out of the mainstream financial system and turn banks into a tool for mass deportation.

The group said the CFPB statement cannot do what the order seems to want. “This statement does not and cannot change existing law, which means it cannot impose a hard-and-fast requirement that lenders consider immigration status,” said Alys Cohen, NCLC’s director of housing advocacy and acting co-director of federal advocacy. She added: “Ironically, in May 2025, the Vought-led CFPB criticized the last Bureau administration for using non-binding guidance.”

Chi Chi Wu, NCLC’s director of consumer reporting and data advocacy, laid out the confusion. The statement says lenders should consider immigration status because an immigrant could be detained or deported and lose income, she said, but it also admits lenders cannot always reasonably predict that, and in those cases they do not have to consider it.

NCLC pointed to the 24 million non-citizens living in the United States with varying immigration statuses. With numbers like that, it said, the odds that any one immigrant is detained or removed are small, and lenders cannot reliably guess who will be affected or how. The group also warned that relying on actual or perceived immigration status could violate the Equal Credit Opportunity Act’s ban on national-origin discrimination.

Credit cards were a particular worry. The Truth in Lending Act only requires lenders to weigh ability to repay when an account is opened or a credit limit is raised. “There’s no need or reason for lenders to harass people with foreign sounding names who hold credit card accounts about their immigration status,” said Lauren Saunders, an NCLC senior attorney.

A second announcement the same day

Also on June 5, 2026, the Financial Crimes Enforcement Network, the FDIC, the OCC and the NCUA issued a joint advisory in coordination with the IRS. It is aimed at non-work-authorized populations and their employers and warns banks about red flags that could point to suspicious activity under the Bank Secrecy Act.

One of those flags is the use of an Individual Taxpayer Identification Number, or ITIN. NCLC said the advisory links ITIN use to possible unauthorized employment and the possible funding of criminal or terrorist organizations. The advisory says certain ITIN use “may be identified as a risk factor requiring enhanced due diligence,” according to the FinCEN advisory page.

Thomson Reuters reported the advisory lists 18 red-flag indicators and tells institutions to report suspected unlawful work arrangements through a Suspicious Activity Report. It also noted that the IRS issues ITINs to people who cannot get Social Security numbers, and that an ITIN does not authorize employment. Banks are asked to include the key term “FINANCIALINTEGRITY-2026-A002” in those reports.

Mayer Brown said the advisory centers on identity theft and payroll fraud, and that no single indicator is decisive on its own.

NCLC said the advisory targets small businesses in agriculture, construction, domestic service, hospitality and home health, among other industries. “The Trump Administration is trying to use the banking system to throttle employment opportunities for immigrant workers and curtail wealth building for people of all different immigration statuses,” said Carla Sanchez-Adams, an NCLC senior attorney.

FinCEN’s advisory page was last updated on October 2, 2026, and it still lists the joint advisory issued June 5, 2026.