Cleaver requests congressional hearing following reports of banks asking customers about citizenship status

Cleaver requests congressional hearing following reports of banks asking customers about citizenship status

KANSAS CITY, MO (KCTV)

A KCTV5 News investigation into banking practices by Bank of America hit a nerve with many of you who we’ve heard from since our initial report.

We’re hearing from customers almost every day now who are furious after finding out their accounts had been frozen without warning.

After our investigation, we heard from even more customers who say the bank froze their accounts when their citizenship came into question.

Dozens of customers tell KCTV5 that they feel the bank does not have the right to freeze their accounts without warning or ask about their citizenship status.

Halfway across the country in Massachusetts, another Bank of America had another customer fuming. 

“I was extremely upset. It was unsettling, scary,” said Susan Milano who lives in Boston.

She contacted KCTV5 after seeing our investigation on the Daily Mail website, a news website based out of the United Kingdom.

“They easily pushed a button and froze my account yet it took them four to five days to turn back on, and I’m still living with the ramifications of this,” Milano said.

Milano says she’s still in disbelief. She’s been a Bank of America customer for 30 years and has never even bounced a check. She suddenly has no access to her checking, savings and credit card. 

Back in May, Milano called Bank of America after she got a W-9 form in the mail. She says she was confused because the form is for independent contractors which didn’t apply to her.

“It took a long time, about 40 minutes,” she said. “I finally got somebody who told me I need to update my information, so I did that. Before I hung up, I asked them if I was all set, and they said yes.”

That was May 31. She thought everything was OK, because they said it was.

However, she was wrong. About a month later on June 23, her card was declined at the ATM. She was in disbelief. Then, she found out all of her accounts were frozen.

“What do you do? Do you call the police because they’re holding your money hostage?” she said.

It was Monday before Milano could talk to anybody with the bank that could help. That’s when a supervisor told her the bank sent her a notice asking for more info, including her citizenship status.

“Which is ridiculous because I just updated my information and nothing has changed,” she said.

This all sounds just like Josh Collins from our first report. But, Milano’s story sounds very much like Collins’ story in our first report.

“That was my money, not their money. It’s not Bank of America’s money,” Collins said.

The bank told the KCTV5 photojournalist he’d received a notice about needing to update his information, including citizenship status. 

Collins thought it was maybe a scam. After all, Bank of America already had his personal info. He thought it was weird considering he’s been a customer for 20 years and was born and raised in Kansas. He figured if it was legit, Bank of America would follow up.

But, Bank of America froze his account.

“They only do that to people’s accounts for people trying to flee the country. We’re not criminals, we didn’t do anything wrong,” Collins said.

Federal law requires banks to collect personal information. But, federal law doesn’t mandate banks ask about your citizenship.  

It is not uncommon for other banks to ask about citizenship status on applications for credit cards or checking accounts. 

Bank of America is the only bank KCTV5 has heard about freezing accounts when existing customers don’t confirm their citizenship.

Milano says she too was told she was sent a notice asking for updated personal info including citizenship. The bank told her it was emailed. However, it turns out they sent it to a non-existent email address.

“So he looked it up and said, ‘Yeah you’re right. We don’t have your email address.’ It was auto-generated to a non-existent email account. So I never received any letter telling me they were going to freeze my account,” Milano said.

She’s now suing the bank in small claims court.

“For me, it took four days, maybe five, to get any access to my money which is my money in my account. I just hope nobody else has to go through this, because I did nothing wrong and to be treated like that is just crazy,” Milano said.

Cleaver calls for congressional hearing

U.S. House Rep. Emanuel Cleaver is calling for a congressional hearing regarding reports of banks questioning customers about their citizenship status. 

KCTV5 has shared a number of stories from customers who said their Bank of America accounts were frozen without warning after their citizenship came into question. 

“I recently became aware of this after hearing reports of people in the area whose bank accounts had been frozen because they did not respond to an inquiry from the bank on their citizenship status. They are interfering with the livelihood of citizens,” Cleaver said in a statement. 

He said he’s requesting a hearing with the Office of the Comptroller of the Currency (OCC), the Financial Crimes Enforcement Network (FinCEN) and other institutions. 

KCTV5 contacted Bank of America and a media representative shared a statement:

Our goal when maintaining customer records – as required by federal law  – is to minimize customer inconvenience while also ensuring we have strong controls in place to mitigate risk of financial crimes.

When we need to update customer information, we ask customers to do so securely using online banking or by calling our client service centers. These requests are made in a variety of ways: online banking pop-ups, email, outbound calls and letters.  We do not disrupt service without attempting to contact customers via several means.   

When we don’t hear back from a customer, we may restrict the account until we can confirm it is in compliance with regulatory requirements. This is disclosed as part our service agreement.  These few instances are usually easily resolved.

All banks by federal law, especially banks with globally active customers, are required to have appropriate risk-based procedures in place to know their customers, including maintaining complete and up-to-date records for all customers. This information is required to meet a variety of obligations.

To fulfill this requirement, banks periodically review customer accounts and obtain from customers any additional, or more current, information necessary to ensure that account information is accurate and that banks can comply with laws and regulatory requirements, including those related to the U.S. Bank Secrecy Act or enforced by the Treasury Department’s Office of Foreign Assets Control (OFAC).

We ask about country of citizenship, in addition to a number of different elements we need. This includes name, address, taxpayer id number, birthdate, source of income, occupation, and country of residence. These questions have been asked for many years.

The Treasury Department’s OFAC enforces economic and trade sanctions against certain foreign countries and individuals. One of the reasons we ask about country of citizenship and dual citizenship is to ensure adherence to these 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.

Citizenship status is not considered when it comes to establishing bank accounts. We do not ask for proof of citizenship.  We maintain relationships with customers of many different nationalities. 

We treat all customers in a similar fashion and most global banks with similar customer account portfolios ask similar questions to meet the requirements we have cited above. 

KCTV5 also spoke with the US Comptroller of the Currency. It’s a federal department that oversees banking security and activity. It wouldn’t comment on any specific bank actions, but you do not have to be a citizen to have a bank account.

KCTV5 is keeping track of all of your complaints, and want to hear from you if you’ve experienced something similar. You can call us or send us an email at investigate@kctv5.com.

Copyright 2018 KCTV (Meredith Corp.) All rights reserved.