The Trump administration is granting local banks broader authority to share customer surveillance videos and cyber information, aiming to target cartel lenders and fraudulent immigration activities, according to an announcement from the Treasury Department on Friday.
Treasury Secretary Scott Bessent shared with Houston bankers that this initiative follows a significant payroll tax fraud case involving an estimated $2.5 billion in questionable banking transactions from 2025.
He connected this financial mismanagement to the ongoing border crisis, attributing it to years of “unchecked illegal immigration under the Biden administration” that has enabled criminal networks to launder money through the U.S. financial system.
The new measures are based on a policy suggestion from the Treasury that mandates banks to report suspicious activities to the relevant authorities.
FinCEN stated that banks are now permitted to exchange surveillance footage and cyber data, like IP addresses, amongst themselves. It’s believed that this collaboration will empower them to present cases to federal entities.
The Treasury highlighted specific fraud indicators, such as adding a new payment recipient followed by a substantial transfer, or when login activities appear from different geographical locations or multiple accounts sharing similar identifying details.
According to the Treasury, this data-sharing capability is rooted in the Patriot Act, specifically Section 314(b).
Bessent remarked that “Americans lose hundreds of billions of dollars to fraud every year,” emphasizing the importance of financial institutions in promptly identifying suspicious behaviors.
Last week, FinCEN issued an advisory addressing the underground economy that supports the border crisis and urged banks to recognize and report certain warning signs associated with illegal immigrant labor.
This guidance focused on illegal employment, questionable labor brokers, shell companies, and widespread identity theft.
The Treasury stated that these fraudulent operations detrimentally affect lawful businesses, depress wages, steal taxpayer funds, and support international criminal organizations.
Meanwhile, the banking sector has been actively lobbying against an executive order that would require their customers to establish citizenship, citing the complexities and costs involved.
A Treasury official noted that this latest enforcement was not about “completely abolishing bank accounts for a wide segment of the population.”
Bessent clarified that their approach does not ask banks to take on border security roles.
He assured Texas bank executives that “we are not asking banks to become immigration officials. We want them to know their customers, identify risks, and report illegal activities.”
The recent measures, including the new video-sharing capabilities and recommendations on illegal labor, form part of President Trump’s broader crackdown.
This initiative intends to restore the integrity of the U.S. financial system, led by the White House Task Force to Combat Fraud, headed by Vice President J.D. Vance.
Bessent pointed out that the government cannot uncover all illegal payroll schemes or wire transfers on its own, recognizing that local bankers often notice emerging risks before they become evident in national data.
He emphasized the responsibility of banks stating that “when you see something and say something, you’re serving the American people by keeping them safe,” adding that information from the banking sector can significantly disrupt criminal activities.
Bessent concluded by asserting that this work significantly contributes to national security.
Since banks have not collected information pertaining to the nationality or immigration status of their customers, there’s a lack of reliable statistics on the potential risks posed by these customers to the financial system.
While FinCEN’s recommendations are not legally obligatory, failing to adhere to them could seriously jeopardize a bank’s regulatory standing, leading to investigations and reputational harm.
In March, the Treasury imposed an $80 million civil penalty on Canaccord Genuity for neglecting to oversee suspicious transactions adequately.
This initiative marks yet another step in President Trump’s aggressive immigration policy, which commenced with his declaration of a national emergency at the southern border on his second term’s opening day, mandating the blocking of work permits for unauthorized immigrants.
In November, FinCEN had already issued a caution regarding cross-border remittances associated with illegal immigration.
