Treasury Tells Banks To Flag Suspected Payroll Schemes Involving Unauthorized Workers
FinCEN told banks on Friday, June 5, 2026, to flag suspected payroll schemes involving unauthorized workers and to report related suspicious activity.[1]
The advisory says such schemes can signal identity theft, payroll-tax fraud or money laundering, and it lays out more than a dozen "red flags" for banks to monitor.[1]
President Trump signed a related executive order in May 2026 directing regulators to look for signs that people without legal status are opening accounts or getting credit.[1] Treasury declined to require banks to collect citizenship data on all customers after industry lobbying over costs and paperwork.[1]
Treasury Secretary Scott Bessent framed the advisory as targeting abuse of the financial system by people in the U.S. illegally while stopping short of new universal data-collection mandates.[1] The guidance asks banks to step up monitoring and to file suspicious-activity reports with FinCEN when they see the outlined warning signs.[1]
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📌 Key Facts
- On Friday, June 5, 2026, FinCEN issued an advisory to banks about schemes tied to hiring unauthorized workers.
- The advisory tells banks to monitor for identity theft, payroll tax fraud and money laundering and outlines more than a dozen “red flags.”
- President Trump signed a related executive order in May 2026 directing regulators to look for signs that people without legal status are opening accounts or getting credit.
- Treasury declined to require banks to collect citizenship data on all customers, after industry lobbying over costs and paperwork.
- Treasury Secretary Scott Bessent framed the move as targeting abuse of the financial system by people in the U.S. illegally.
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