Simple bank discriminates against permanent US residents

Upon applying for this new product, Simple asks for a couple of questions like occupation, source of income, whether you are a PEP (politically exposed person) etc. One of these questions is:

Upon submitting the short questionnaire, the following message appears:

I first thought this was a UX mistake, a wrongly phrased question, but it seems, according their Twitter support channel, Simple does actively discriminate against lawful permanent US residents, which is very odd. In the ten years I’ve been living in USA I never experienced any US bank discriminating against permanent residents.

Permanent residents — aka “green card holders” — pretty much enjoy the same privileges as US Citizens. Permanent residents have a social security number, tax ID number, driver’s license, credits score etc. They are lawfully eligible to live and work in USA, buy property, loan money, start a business, pay taxes etc. The only few things permanent residents can’t do is vote and take on a government job, but that (should be) about it.

Are things going south in terms of customer experience since BBVA Compass acquired Simple and the original CEO, Joshua Reich left? Simple always touted to be a new kind of modern banking, but I am not sure denying lawful residents can be considered modern. It’s conservative at least.

Lastly, when signing up for a regular account at Simple, there is already a verification process in place. But yet, existing customers who have been banking with Simple for several years suddenly get hit with a permanent residency exclusion. Explain me how Simple is avoiding doing business with potential terrorists by allowing them a regular account, but by excluding them from setting up a Savings Goal? It doesn’t make any sense.

What Simple is — unintentionally — doing, is building a wall between US Citizens and lawful permanent US residents.

I received an official reply from Simple:

Isn’t it odd that ONLY Simple bank discriminates, but US banks like Marcus, Ally etc. all welcome lawful permanent US residents? Following the thinking of Simple bank, ALL other US banks are non-compliant with the Bank Secrecy Act.

Additionally, there is very little difference between a US citizen and US permanent resident (both “US persons”), so the excuse that they “are not set up to offer accounts to non-citizens” is absolute bullshit. The way Simple verifies a US citizen is exactly the same as how one would verify a permanent US resident, by requesting the following pieces of information:

You can also turn around Simple’s thinking: How would Simple proof someone is not a US citizen? Will they ask a US citizen for their passport? I don’t think so, as most Americans don’t even have a passport… So Simple doesn’t even have a way of verifying whether a client is a US citizen.

There is only one option left and that is to take legal action against Simple. The issue here is not regarding the specific account they offer (lots of other banks offer comparable rates), but about the simple fact they treat lawful permanent US residents different from US citizens.

If you follow Simple’s thinking, US banks and lenders could ban lawful permanent US residents from opening accounts, getting credit cards, getting a mortgage, starting an education,… preventing people from doing business, buy a property etc. It’s a dangerous precedent that in light of the current political turmoil in US can simply not be accepted.

Simple’s reference to the Bank Secrecy Act’s new rules since May 2016 doesn’t hold any merit either as it doesn’t state anything about treating permanent US residents differently. The rules talk about building up a risk profile, but I don’t see how a lawful permanent US residents would indicate a higher risk. Like already said before, if the resident would be part of a rogue state (Iran, North Korea, Sudan, Syria), there is a case to be made. But excluding all permanent residents is pretty extreme and unfair.

A “US person” — which includes “permanent resident” — is protected by all laws of the United States, the state of residence and local jurisdictions. This prohibits discrimination based on a person’s national origin, race, color, religion, disability, gender, etc.

Marcus (by Goldman Sachs), Ally.com are just a few other banks offering a similar high yielding savings accounts. Looking at their requirements it’s clear they all clearly state that lawful permanent US residents are allowed to open an account:

Simple bank has gone completely silent on this issue and is ignoring my requests for more concrete information. I’ve been pushing them in a polite way, but it seems they decided to give me the cold shoulder instead. Facts and law are hard to argue about, but it seems they are unable to give any valid reason.

Ally now pays 2% on a high-yield savings account. There is no reason to Simple.

#closingsimple

Almost half a year passed and nothing changed, see yesterday’s screenshot below (date: March 26th, 2019):

Here is the full class action document (Case 3:19-cv-01541):

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