Boy unlike the big banks in the FATCA partner countries are they pissed in their comment letter.
A couple of key points:
1. Still very concerned about the remittance issue with credit unions in Central America.
2. Want an almost complete exemption for all credit unions from FATCA.
3. Basically impossible in terms of resources for credit unions to fully comply with FATCA even if they wanted to.
4. Want to be able to accept local resident US Persons without a reporting obligation
5. Significant number of credit unions will be non participating no matter what.
It will be interesting to see how this turns out. The left is always a huge fan of credit unions. I wonder how they will play this.
When someone storms into a British bank and starts to complain that their data is being shared with the IRS than sparks will start to fly.
British banks have learnt their lessons about unhappy customers and legal action resulting in £100s millions being paid out for overcharged banks fees, mis-sold pensions, endowment policies, and currently PPI commercials on the telly.
Will FATCA and discrimination be next lesson learnt?
And we haven’t even started to talk about the 30% withholding tax yet?
The UK government can do what they want by getting in bed with FATCA, but UK courts will decide FATCA’s final version.
From the US government’s point of view, I can’t remember in living memory a situation where US citizens are fighting thier own government in foreign courts by sueing foreigning companies against implementing a US law. It’s such a waste of time. But Carl Levin would know all about wasting time being a member of the US Senate.
So guys I meant “sparks” early morning typing. [fixed, but it is also early for me, so I fixed the each of the words “start” first before getting the right one–Petros 🙂 ]
@A Gentleman’s Rapier – the IRS and god like powers, let them come to my overseas front door – I’ll give them a “I’ve found JC” moment outside the US.
@Wondering
What you describe is already happening where I live in the EU and to me personally as an EU citizen unfortunate enough to have a US birthplace. I am currently restricted to current and savings accounts at Deutsche Bank, for example. Unlike in Canada, in the EU you have to show a passport or national identity card and they register your place of birth as well, so it is easy for the banks here to weed out “US Persons” in a way that currently isn’t possible in Canada. This article mentions what is going on in Germany a bit more:
http://www.thelocal.de/money/20111215-39519.html
Swedish banks have yet to determine if they will comply with FATCA or simply start dumping US clients like the German banks are doing:
http://www.thelocal.se/39522/20120306/
Renouncing citizenship is the only option that I see to be able to plan financially in the long term and not be forced to live in the US. Good work US government!
@Don Pomodoro – has anyone looked into discrimination law. You’re being discriminated by place of birth and as an EU citizen you have the right to equal treatment. Also I’ve read in Germany you are “German” in Germany and the Bundesregierung doesn’t recognise second citizenships.
As also an EU citizen, if I’m denied financial services because of place of birth, I’m going to raise hell.
If worse comes to worst I’ll consider printing off an official looking CLN complete with some bull**it seal and present it to the bank and say I’ve renounced – how on earth are they going to verify it? It’s worth a go. As long as you have a valid EU passport are you really breaking German or other EU law by telling bank you renounced your US citizenship when you haven’t?? At the end of the day if you’re opening an account in your legal name and paying the German tax why would the German tax office really care?
All you want the bank to do is put you down as German or whatever your EU passport says and that’s it.
I’ve also considered creating a second EU identity. In the UK I’ll could change my EU passport name by deed poll for £80, open up new accounts under the new name, transfer funds, and the IRS willl have a fun time trying to matching up your new name if you want to resort to such measures. Where would they start if it was a common name?
However I’d rather the EU to enforce equal treatment of EU citizens first. As for stocks, I would only invest in foreign stocks and forget about US equities, you can make money in other parts of the world as well.
Both SIFMA(The US Domestic securities trade group) and the American Bankers Association have published comment letters also. ABA and SIFMA among other things want like everyone else FATCA to be delayed for one year and all foreign tax deferred accounts such as RDSP, TFSA, RESP etc to be exempted. SIFMA and ABA are also concerned the US if it is providing true recipricioty with the five European countries would have to require domestic US banks to ask for the nationality of their domestic US customers which ABA claims the US Treasury and IRS have no right to demand under current US law.
http://bsmlegal.com/PDFs/SIFMACommentsWithAppendix_2012_04_30.pdf
http://bsmlegal.com/PDFs/TCH-ABA%20Letter%20in%20Response%20to%20Proposed%20FATCA%20Regulations.pdf
I link comment SIFMA makes several times that FATCA is spiralling out of control.
@Don Pomodoro
I am so sorry it has come to this for you. It’s unfair by any standard. At risk of sounding naive, there any possibility of legal action based on discrimination or equality laws?
Why should your German citizenship (I assume that’s what you hold) be second class to other German citizens born anywhere else?
http://www.woccu.org/newsroom/releases/IRS_Issues_Foreign_Account_Tax_Compliance_Act_Regulation
January 18, 2013
IRS Issues Foreign Account Tax Compliance Act RegulationFinal regulation adopts World Council recommendations to reduce CU burden