20,682 complaints in six months: the wave of bank account closures hitting immigrants in the United States

The letter arrives in the mail and fits in a single paragraph. The bank has decided to close your account. You have thirty days. There is no number to call and argue, no explanation, and if you walk into a branch the teller will tell you — honestly — that they don't know why either.

This is happening to a lot of people. Between December 2025 and May 2026, the Consumer Financial Protection Bureau received 20,682 complaints from customers locked out of their bank accounts with no explanation, according to an analysis by the firm McCarthy Hatch reported by American Banker. There were 609,000 complaints in total over that period; roughly 3 percent were about account closures.

And that number understates the problem on purpose. Most people whose accounts get closed never file a federal complaint — they switch banks and move on. "The number of accounts that are suddenly closed is going through the roof," says Jim McCarthy, chairman of the firm behind the count.

Why the bank won't explain

This is the maddening part, and it is worth understanding because it changes what you can actually do about it.

When a bank closes an account over suspected irregular activity, it files a confidential report with the government. The Bank Secrecy Act flatly prohibits telling the customer that report exists. It is not rudeness or contempt: the employee on the phone would be breaking the law by telling you.

The outcome is the one you already know. Someone who has done nothing wrong loses access to their money, gets no explanation, and is left feeling like a suspect. The balance almost always comes back — but it can take weeks.

Diane Thompson, of the National Consumer Law Center, puts it plainly: "In the current climate there is a desire by many financial institutions to overcomply." Overcomplying means closing first and not asking later, because a regulatory fine costs far more than losing a customer.

The industry has a word for it: de-risking. The Treasury Department acknowledged in 2023 that it is a real problem, and that it falls hardest on remittance businesses and on organizations serving immigrant communities. Banks don't always close accounts one at a time — sometimes they walk away from an entire market.

What has actually been proven against Bank of America

Nothing here needs to be assumed, because there is a signed federal order.

In July 2022, two regulators fined Bank of America $225 million — $100 million from the CFPB and $125 million from the Office of the Comptroller of the Currency — over how it handled unemployment benefit cards for twelve states during the pandemic. The CFPB's order describes precisely what many people have lived through since:

• From fall 2020 through mid-2021, the bank replaced real fraud investigations with an automated filter that froze accounts on very simple flags. Regulators wrote that it "set a low bar" and harmed thousands of legitimate cardholders.
• It applied that filter retroactively, to deny claims that had already been investigated.
• It put people through a maze to unfreeze their own money: problems couldn't be reported online or in a branch, hold times ran for hours, and the bank advertised service "24 hours a day, seven days a week" that did not actually exist.
• It sent customers back to California's unemployment agency knowing that agency was overwhelmed and could not help them.

"Taxpayers relied on banks to distribute needed funds to families and small businesses to rescue the economy from collapse when the pandemic hit," CFPB Director Rohit Chopra said at the time. "Bank of America failed to live up to its legal obligations." The order also required the bank to repay wrongly denied benefits and to pay compensation scaled to how long each account stayed frozen — an amount regulators estimated would reach "hundreds of millions of dollars."

And a lawsuit that is still alive

There is a second front, and it goes directly to closing accounts because of who someone is. In the class action Nia v. Bank of America (case 3:21-cv-01799, Southern District of California), a permanent resident of Iranian origin alleges the bank closed his accounts even after he provided every document requested, and that this was not an isolated case but a pattern affecting people of that background.

The bank asked the court to throw the case out. On May 18, 2022, Judge Cynthia Bashant denied that motion and let the case move into discovery. A judge allowing a case to proceed does not mean the allegations are proven — that deserves saying plainly. It means they are serious enough to force the bank to open its files.

Now the part that needs saying, even if it is uncomfortable: the hoax

In 2025 a TikTok video went viral — more than 727,000 views — in which a woman presenting herself as a Bank of America customer service employee claimed the bank was freezing and closing immigrants' accounts and demanding proof of immigration status. It spread across Facebook, Instagram, Reddit and YouTube too.

It is false. The bank said the claims were "completely false," that "there have been no changes to our policy," and that the woman did not work there. Factchequeado reviewed the claim and found no credible reporting to support it.

We are not saying this to defend any bank. We are saying it because believing the hoax hurts you. People who believe it pull their money out in cash, stop using the account they need to get paid, and — worst of all — never see the real problem, the one documented above, the one that does have legal remedies. A false rumor about a real problem is the most efficient way to leave people defenseless.

One legal point worth knowing: to open an account, the USA Patriot Act requires verifying identity — name, date of birth, address and a government ID — but it does not require proving citizenship. Millions of people bank with an ITIN and a foreign passport, and that has not changed. What American Banker does report is that some banks have started refusing to open accounts for people without a Social Security number. That is each bank's policy, not the law.

ChexSystems: the list nobody told you about

This is what turns a bad week into a years-long problem, and almost nobody hears about it until it happens to them.

When a bank closes an account — especially one left with a negative balance or flagged for suspected fraud — it can report that to Chex Systems, Inc., a private consumer reporting agency. Think of it as a credit bureau, but for checking accounts. Nearly every bank checks it before opening an account for you.

If you show up there, bank after bank will turn you down without telling you why. And the record stays for five years, according to the company itself, unless whoever reported it asks for removal or the law requires it to come off.

The good news is that ChexSystems is regulated. The Fair Credit Reporting Act gives you concrete rights, and the company spells them out in writing:

• Your report, free. You can request it at least once every twelve months — and also free within 60 days of being denied an account because of that file. Request it at chexsystems.com or by mail to Consumer Relations, PO Box 583399, Minneapolis, MN 55458.
• Dispute what's wrong. If something is inaccurate or incomplete, you dispute it and they must investigate free of charge, within 30 days. Whoever supplied the bad information has to correct it and notify everyone who received it.
• Sue. If ChexSystems reports wrong information, the FCRA lets you sue — and if you win, the company pays your attorney's fees and costs. That detail matters: it means lawyers will take these cases without charging you up front.

The CFPB keeps an official page on Chex Systems with contact details and the process.

If your account was just closed

First things first. You don't have to do all of it in one day, but do it in this order.

1. Get your money out and protect anything that pays itself. Direct deposit, rent, utilities, phone. If those payments bounce, the damage multiplies.
2. Get everything in writing. Ask for written confirmation of the closing date and how your balance will be returned. Don't argue by phone — ask for paper or email.
3. Pull your ChexSystems report. It's free, and it is what will explain why the next bank also says no. Do this before you try to open another account.
4. If there's an error, dispute it. In writing, and keep a copy. They have 30 days.
5. File a complaint with the CFPB at consumerfinance.gov. It's free, it's available in Spanish, and the bank is required to respond. Those 20,682 complaints this story is built on are exactly that: people who put it on the record. Without that record, the problem does not exist as far as regulators are concerned.
6. If a collector calls, know the rule. When an account closes in the negative, the debt usually goes to a collection agency. The Fair Debt Collection Practices Act bars that agency from threatening you, abusing you, calling at odd hours, or telling you that you'll go to jail over a consumer debt. You can demand written validation of the debt and tell them in writing to stop calling.
7. Meanwhile, find a bank that won't shut the door. Many community credit unions and Bank On certified accounts are built for exactly this situation: no overdraft fees, and several don't screen through ChexSystems at all.

Why this matters

Losing your bank account in the United States isn't an inconvenience — it's a quiet sentence. Without an account you pay a fee to cash your own paycheck, you can't get direct deposit, you can't rent in many places, and every dollar you send home costs more.

The FDIC has documented that close to half of the people without a bank account in this country used to have one. In other words: this is largely not about people who never got in. It's about people the system pushed out.

The abuse, where it exists, isn't in a TikTok rumor. It's in an automated filter that freezes thousands of people's money with nobody reviewing it, in a phone line advertising 24-hour help that isn't there, and in a private list that keeps you out of the banking system for five years without telling you why. All of that is in public documents, with signed fines and open lawsuits. And all of that you can actually fight.