Sen. Tom Cotton (R., Ark.) is introducing legislation that would ban illegal immigrants from accessing the American banking system.
Cotton’s legislation, obtained exclusively by the Washington Reporter, would require American financial institutions to verify the legal status of new customers to ensure that American banks are not helping illegal immigrants break the law.
“Access to the American banking system is a privilege that should only be reserved for those who respect our laws and sovereignty,” Cotton said of his bill, the Know Your American Customer Act. “My bill will prevent illegal aliens from using our financial institutions to help them stay in our country.”
The Know Your American Customer Act would require banks and credit unions that are insured by either the Federal Deposit Insurance Corporation (FDIC) or by the National Credit Union Administration (NCUA) to verify that new customers are an American citizen, a permanent resident, or in America legally on a valid visa.
Currently, customers opening bank accounts are required to provide valid identification; Cotton’s bill adds an additional check for legal status, while putting the onus and the liability on the customers, not on the banks.
The bill also makes it a federal crime for anyone in America illegally to open or maintain an account at covered institutions, as long as the institution makes a “good faith effort to verify documentation and comply with the new requirements,” Cotton’s office said.
In order to prevent immediate chaos in the banking industry, the bill would grandfather all existing clients into the system and allow them to maintain their existing accounts or create new accounts at banks or credit unions, provided they already have a relationship with the institution in question.
Cotton has long been a staunch critic of illegal immigration; in 2025, he wrote to Treasury Secretary Scott Bessent urging an investigation into illegal immigrants accessing the American banking system. “When individuals are allowed to open accounts without verifying legal status, we are permitting illegal aliens to establish financial roots and integrate economically, all while bypassing the legal channels that millions use properly,” Cotton said at the time.
Cotton, the Senate GOP’s Conference Chair, has rolled out a series of bills, obtained exclusively by the Reporter, in recent weeks that would tackle different aspects of the illegal immigration problem facing America.
Another Cotton bill, the Naturalization Accountability Act, would make it easier to denaturalize criminals convicted of felonies and terrorists by adding any felony conviction as grounds for revocation of naturalization.
