The Trump Administration is considering requiring banks to verify the citizenship status of new – and existing – account holders. In a new insight, Director of Regulatory Policy Dan Goldbeck uses existing data to estimate the potential administrative burdens of such a compliance regime and finds it would be very costly for both banks and their customers.

Key points:

• To estimate potential costs of the requirement, this analysis applies cost estimates from similar verification programs across other agencies to the Financial Crimes Enforcement Network’s (FinCEN) current Customer Identification Program (CIP).
• It finds that the checking the citizenship status of new accounts could add anywhere from 33.1–73.3 million additional paperwork hours and $2.6–$5.6 billion in additional costs.
• Verifying new accounts is the tip of the iceberg; the lack of details makes it difficult to estimate the costs of verifying existing accountholders, but even under the most conservative of assumptions it would add millions of hours and billions of dollars in administrative costs.

Read the analysis.