U.S. regulator says executive order on bank customer checks is common sense

A U.S. banking regulator described a new executive order directing banks to review customer immigration status as a reasonable set of reforms. The order aligns with ongoing federal efforts to update anti-money laundering rules. The regulator spoke Wednesday at Semafor’s Banking on the Future Forum.

The official said the order gives banks tools they need while preserving flexibility in how they know their customers. The regulator added that the order syncs with the Treasury Department’s Financial Crimes Enforcement Network effort to overhaul how banks monitor for money laundering and terrorism financing.

That effort will allow officials to highlight certain areas of potential risk and direct banks to examine those areas.

Fintech access and charter approvals The regulator expressed optimism that incoming Federal Reserve leadership might speed fintech firms’ access to central bank payment rails. A separate executive order signed Tuesday seeks the same goal. The regulator defended the Office of the Comptroller of the Currency’s accelerated approval of charters for nonbank firms, including crypto companies.

The official said the agency is restoring regular working order and following statutory timeframes set by Congress. The regulator noted that the Federal Deposit Insurance Corporation has seen many national trust bank charter applications after an 18-year period of low activity.

Changes at the FDIC under its current leadership aim to make the deposit insurance process faster and more predictable for applicants. The regulator said litigation threats from banking groups keep the agency focused on its statutory duties. The official also called on banks to help build political support for federal preemption on issues such as swipe fees.