Soon after I finished my PhD, I had the experience of teaching as an adjunct professor in Ontario. Eventually, I quit because I felt that the working conditions for contingent labor in higher education sucked–and they do: just google the terms “adjunct hell”. Then, I worked another job which I soon quit. But to damage my reputation after I quit, one of the people from the second job asked for a reference via e-mail from the first employer and soon a flurry of e-mails had damaged my reputation among about a couple dozen people. The first employer had even gone so far as to accuse me of “unpleasant breaches of trust”, not realizing that the term “breach of trust” is legaleze, usually for criminal behaviour related to money or the virtue of young women. Later, the man apologized to me, saying that what he meant is that I had let them down.
This whole incident made me look into privacy laws in Ontario, and soon I found that I could have sued my first employer for defamation of character and the improper divulging of private information with malice. Employers must be circumspect about information: about what information they share with outsiders; about the recipients of the information; and about who within the company gives out the information. Since the recipient of the information was no longer my employer, it no longer served any purpose as a reference. Since the person who wrote the damaging reference evidently felt malice towards me, he should have found someone else to write the reference. Since the information could potentially damage my reputation, the first employer should have made sure that they followed proper protocols as an institution in order to avoid a defamation or privacy of information lawsuit. The guiding principle is: Information is on a need to know basis. Never divulge private information to someone who is not in the need to know.
This is the curious thing about FATCA. The Canadian government has announced that it has serious concerns about FATCA. Furthermore, Finance Minister Flaherty has insisted to the Americans that Canada is not a tax haven, and therefore there is little likelihood that the IRS will glean information through FATCA that will help with tax enforcement.
So if FATCA isn’t about tax enforcement, what then? Well, as our own renounceuscitizenship has so adeptly pointed out, the most valuable FBAR to the IRS is an unfiled FBAR.
I believe that this is all part of a master plan: The first part of the plan is to saturate the media with the OVD offer. Then, those who still remain can no longer use the excuse of ignorance; the IRS will say, ”Where the hell were you, in Timbuktu, that you didn’t hear about FBAR and OVD programs?” So any remaining undeclared accounts that they find will now be subject to wilful penalties up to 50% of the contents of the account. But the perennial problem of FBAR is this: since the account is in a foreign country, the only way that the US government can learn about it is if you tell them. So if you don’t tell them they won’t know.
So the second part of the master plan is FATCA: they will force your bank to rat on you.
Now the Canadian government has said that it will not collect FBAR fines. So if you don’t have to pay the fines, and the information is useless for tax enforcement, why then does the IRS need the account information? In other words, the basic test for divulging private information is not satisfied: the IRS is not in the need to know because the information should be useless to them.
But it won’t be useless to the IRS, because the third part of the master plan is this: the IRS will start sending fines to Canadian residents, based on the FATCA information that the Banks have sent them. These fines will consist of 50% of your account balance, for wilful failure to file FBARs (this is implied by what the IRS has official stated). Even though the Canadian government has said they won’t collect these fines, the IRS is hoping that there will be some very frightened people who will nevertheless pay the fines to them directly, either the full amount or a settlement of a portion of the extortion.
Thus, the banks are preparing to divulge information to the IRS that the Canadian government has said is unnecessary since Canada is not a tax haven. Not only so, but that information can do great damage to many Canadians residents who have undisclosed accounts. This is a disaster and this is why we must stop the Canadian banks from implementing FATCA and giving millions of account numbers with names and addresses to the United States. We must plead with the Canadian government to stop them. If that doesn’t work, we need to begin protests and other actions against the major banks.