Bank Of America Freezing Accounts Of Non-citizens

by Bamidele Ogunberu Posted on September 1st, 2018

Charlotte, North Carolina based Bank of America is facing scrutiny amid reports it has been freezing the bank accounts of customers suspected of not being legal U.S. citizens.

Saeed Moshfegh woke up earlier this month to discover the strangest thing: though he had plenty of money in his Bank of America account, he couldn’t access it.

An Iranian getting his Ph.D in physics at the University of Miami, Moshfegh used the account for everyday transactions. All he had to do to maintain the account was show proof of legal residency every six months.

“I think it’s onerous, but I’d been doing it,” said Moshfegh, who has lived in the U.S. for the past seven years. He recently married an American.

That Thursday, Moshfegh went to his local branch near South Miami. He was told that the documentation he had provided could not be accepted. Bank officials insisted he produce a different form, according to Moshfegh. The bank was wrong, he maintains, because the form he had supplied was the correct one based on his current status as a student nearing graduation.

“This bank doesn’t know how the immigration system works, so they didn’t accept my document,” said Moshfegh, 36.

Locked out of his account, Moshfegh couldn’t pay his rent, which was due that week. Credit card payments were suddenly rejected.

His case isn’t unique. In recent months, Bank of America has been accused of freezing or threatening to freeze customers’ accounts after asking about their legal status in the U.S.. In July, multiple customers reported that they had been locked out of their accounts after Bank of America questioned whether the account holders were U.S. citizens or dual citizens.

Josh Collins and his wife Jessica Salazar Collins of were notified by Bank of America that Josh, who was born in Wichita, had to prove his citizenship. They thought it was a scam until the bank cut off access to their assets

Kansas-born Josh Collins received an unusual-looking letter purportedly from the bank asking about his citizenship status. He said he thought the mailer was spam and ignored it—only to have his account frozen a few weeks later.

After Collins’ story was first reported locally, he and his wife received messages from others who had been locked out of their accounts for weeks, the Post reported.

Tennessee native David Lewis says he received the same suspicious-looking letter as Collins. In an interview with the Miami Herald, Lewis said he has maintained an account with Bank of America for about 30 years. In the letter, the bank inquired about his citizenship, income, and social security number.

When he called Bank of America, he was told his account would be frozen if he did not fill out the forms. That phone conversation led him to cancel his account, he said. “One would think a national bank would be careful about looking stupid after Wells Fargo,” he said, referring to Wells’ having been accused of creating millions of unauthorized accounts.

Proof of citizenship is not required to open a bank account in the U.S., according to Stephanie Collins, a spokesperson for the Office of the Comptroller of the Currency, the federal agency that supervises branch banking. Banks are merely required to identify and report suspicious transactions and maintain and update customer information, she said. Banks have not received any new instructions to collect more information about customers.

In response to an inquiries from the Miami Herald, Bank of America spokesperson Carla Molina said she could not comment on specific cases. But she said there had been no change in how Bank of America collects information from customers, including citizenship, in at least a decade. The bank attempts to contact customers before the change the status of their bank accounts, she said.

“There’s nothing new,” Molina said.

Paulina Gonzalez, executive director of the California Reinvestment Coalition, told the Herald she disagrees.

“We work with consumer groups and financial counselors in immigrant communities across [California] and the country,” she said in an email. “This is new. We have Bank of America customers who we’ve spoken to who have never been asked this before last year. If they have this asked of them before they can show us proof.”

In recent months, her group has received several complaints about being asked for proof of citizenship; almost all have come from Bank of America customers, she said. An article in American Banker magazine also highlighted Bank of America as the one institution specifically facing backlash for its policies.

Spokespersons for Wells Fargo and Citibank both said they may ask about customers’ citizenship to maintain compliance with know-your-customer and anti-money laundering rules. They said no new policies asking for citizenship status have been put in place.

Molina, the Bank of America spokesperson, said the new customer complaints may simply be a response to heightened sensitivities to the debate over immigration in the U.S.

But Gonzalez said the bank’s scrutiny has created a chilling effect in immigrant communities already feeling pressure from the Trump Administration’s crackdown on foreign-born residents.

“Fear is gripping these communities,” Gonzalez said. “It’s like walking into a grocery store to buy milk and being asked for your citizenship at checkout—banking is one of the core aspects of daily life in this country. To be faced with this question in order to do banking seems as un-American as you can get.”

Gonzalez’s coalition has now launched a petition, “Tell Bank of America: Stand with immigrants,” that accuses the bank of abetting the Trump Administration’s crackdown on immigrants, and calls on the bank to to “protect immigrants’ civil rights and stop collecting information about the citizenship status of its customers.” The petition has received more than 61,000 signatures since Aug. 29.

Dan Hernandez, a Broward County native of Cuban heritage now working as a TV writer in Los Angeles, said he had his business account suspended by Bank of America in December 2016. When he asked why, he was told he was under suspicion of doing business with Cuba. His corporation was called Cuban Missile Inc.—”Cuban Missile” has been his nickname since childhood.

“I started screaming that this was racist,” he said. “Like, did you go through every company that had ’Jewish bagels’ in its name, or how about calling someone with ‘Korean BBQ’ to see if they’re doing business with Kim Jong Un?”

He eventually Tweeted at the bank’s social media account—and had his situation resolved within 45 minutes. He says he feels lucky that he was able to leverage that platform and his status to get a relatively quick fix, because he is certain others do not have the ability to do so.

“It was extremely scary,” Hernandez, 34, said. “I knew I didn’t do anything wrong, but it puts doubt in your mind. A bank can crush your life for arbitrary reasons and never tell you why.”

For Moshfegh, the Miami physics student, it was not until he’d had conversations with multiple Bank of America officials that he was able to convince them to let him withdraw all his funds; Bank of America would not let him keep the account.

“It’s not the business of Bank of America to shut down someone’s account,” he said. “Immigration officers are different from Bank of America—with a bank, I would like to feel respect…[and be treated] how they treat other customers. But they treat me as an alien.”

EARLIER : Bank Of America Faces Backlash For Asking Customers Citizenship Status

Charlotte, North Carolina based Bank of America is facing backlash for asking customers to reveal their citizenship status, a predicament that illustrates how banks’ efforts to comply with customer identification rules carry higher risk at a time when many immigrants feel threatened by President Trump.

The bank has been inquiring about account holders’ country of citizenship, as well as whether they hold dual citizenship. In one case that has garnered attention nationally, a Kansas couple that failed to provide the requested information said their account was temporarily frozen.

Bank of America’s questions are setting off alarm bells in Latino communities, where many people fear that any information that noncitizens provide to their banks could later be used against them. Those worries are particularly acute given the Trump administration’s hardline approach to immigration enforcement.

Hey @BankofAmerica if you keep harassing customers about their citizenship status I’m going to empty my accounts and switch to a credit union. What’s with that?

— John Corgi (@JawnCorgi) July 30, 2018

Time to #Boycott @BankofAmerica — Have YOU gotten a letter asking for verification of citizenship?

— Left Of Main Street (@LeftOfMainSt) July 30, 2018

“You’re going into the bank to deposit your weekly earnings, and you could be a legal permanent resident, and you’re being asked to show your citizenship,” said Paulina Gonzalez, executive director of the California Reinvestment Coalition. “That’s concerning to us.”

Though worries about the citizenship questions only made headlines in recent months, as existing Bank of America customers have reported receiving notices for the first time, a bank spokesman said that the firm has been asking questions about citizenship status for many years.

A local Bank of America customer said he felt like both he and his wife were being targeted because of their ethnicity after an online profile update asked him if he had dual U.S. citizenship.

Mickey Citron, a Bank of America customer since 2005, said the questions went from routine to unsettling when the dual-citizenship inquiry popped up on the second page.

“I felt like I was being targeted because of us being Hispanic,” Citron said. “I felt attacked.”

Citron said the couple moved to Orlando from Brooklyn, New York 13 years ago, and opened accounts with a Bank of America Orlando branch.

“I’m like ‘What are they talking about?’” Cintron said. “I told my wife I refuse to answer the question.”

The Citrons said they will keep their accounts with the bank.

A Kansas City news photographer said his account was suspended until he told a bank representative he was a U.S. citizen.

Josh Collins was born in Kansas but he said his Bank of America account was frozen until he confirmed to a company representative he was a U.S. citizen.

The photojournalist said he received a letter from the bank in the mail asking for personal information that included his Social Security number and citizenship status. He ignored it because he thought it might be a scam. “I figured if it was legitimate there would some follow-up,” he told us by phone. “The second communication from them was freezing my bank account. It’s a great way to get my attention.”

Collins said his family first discovered their bank account was frozen during a week off they spent at home in Kansas City. On 24 July 2018, his wife Jessica tried to buy tacos for their children while they were en route to go swimming, but their debit card was declined for the purchase. They phoned the bank to inquire about the problem and learned their account had been frozen. Josh Collins said one of the first things the bank representative asked him was whether he was a U.S. citizen.

As a result of the incident, Collins said he and his wife and phasing out use of their Bank of America account and have opened one with a local credit union.

As immigration and citizenship have been topics of intense focus in recent months, Collins said he was not surprised that his story went viral. But he pointed out that although some reports said the bank “demanded” proof of citizenship, that is not true. Bank representatives asked him to confirm his citizenship status orally, and the only identification he was required to show in order to re-access his bank account was his driver’s license.

Bank of America, BofA, spokesman Christopher Feeney also noted that all banks are required to maintain complete and accurate records for all of their customers.

“Customers are asked to provide information banks need to meet a variety of requirements, including those related to economic sanctions, anti-money-laundering, and other programs administered by the U.S. Treasury and other government agencies,” Christopher Feeney said.

“One of the reasons we ask about country of citizenship is to ensure adherence to economic sanctions laws. Because banks must comply with sanctions that restrict or prohibit activity in or with certain sanctioned countries or persons, it is important for banks to know the country of citizenship of its customers,” Feeney added.

“Like all financial institutions, we’re required by law to maintain complete and accurate records for all of our customers and may periodically request information as required by law and regulation. This is not unique to Bank of America. This type of outreach is nothing new and the information must be up to date. Therefore we periodically reach out to customers, which is what we did in this case.

Over time, we reach out to all customers to verify their information, not only specific customers. If we don’t hear from a customer in response to our outreach, as a last resort, we may restrict the account until we can confirm it is in compliance with regulatory requirements.” Bank of America added.

Banks are not explicitly required under federal regulations to ask about their customers’ citizenship status, and it is unclear how common that particular question is.

A spokesman for Treasury’s Financial Crimes Enforcement Network said that banks generally must collect their customers’ names, dates of birth, addresses and tax identification numbers, and that foreign passport numbers can be collected in lieu of a tax ID number.

“We would defer to financial institutions to discuss their specific compliance programs,” the spokesman said in an email.

Banks with large foreign operations may be more likely to ask customers about their citizenship status, due in part to the risks associated with providing banking services to citizens of countries that face U.S. sanctions.

The American Bankers Association confirmed the security protocols.

“Banks of all sizes are required to collect a range of information about their customers to comply with the Bank Secrecy Act of 1970 and ‘Know Your Customer’ standards,” ABA spokesperson Blair Bernstein said. “Since 9/11, these strict regulatory requirements have steadily expanded to deter illicit activity within the U.S. financial system.”

According to Bernstein, banks have been required to “verify the identities of all customers and maintain updated and accurate customer information.”

Erich Ferrari, a lawyer who represents financial institutions in connection with sanctions rules, argued that all U.S. banks should be asking their customers about their citizenship status.

As one example of why he believes banks should be asking the citizenship question, Ferrari noted that banks face certain restrictions on doing business with Cuban citizens, regardless of where those people live.

But what makes sense inside of a large financial institution may be hard to understand in an immigrant community. Undocumented immigrants are often fearful about their ability to remain in the U.S., and may be reluctant to provide information that they fear could be used against them.

And at least in some instances, BofA’s response to concerned customers has sown more distrust. Jessica Salazar Collins, the Kansas woman whose husband’s account was temporarily frozen, said that they still have not received an explanation from the bank about why it needs citizenship information.

“Not one person on the phone could get me a reason,” she said. “Nobody from Bank of America has contacted us to explain better why this happened to us.”

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