We have the smoking gun right here. I believe the fact that TD is now publishing this document is enough to now start making formal complaints to the Privacy Commissioner’s Office both in Ottawa and her provincial counterparts. If the Privacy Commisioners office won’t do anything then I believe the courts are now an available avenue. Lawyer up as they say. It might also be worthwhile to forward this form to the lawyer I recommended several months ago for his take.
http://www.tdwaterhouse.ca/products-services/investing/documentation-index.jsp
http://www.tdwaterhouse.ca/document/PDF/apply/forms/tdw-apply-forms-591856-di.pdf
I believe that by publishing the above linked form TD is now in VIOLATION of Canadian law and is now subject to whatever legal action IBS members want to throw at them. (Note: there is no definition at this point of who exactly even is a US citizen and I suspect many of us don’t even consider ourselves to be ones in our own minds).
I’m not sure if you can really make the “slippery slope” argument just yet, are RBC requiring this same information? TD through acquisition and expansion are now one of the top three retail banks in Manhattan through their TD Bank, N.A. subsidiary, so protecting their US relationships seems to be a given. I don’t know about the other major Canadian financial institution’s I think RBC owns a US retail bank too, do they all have major operations in the US?
@WhoaIt’sSteve
RBC most definitely has US holdings and I believe BMO also does. If TD is doing this, it truly is only a matter of time that all of Canada’s bank will be doing the same thing, with similar questions on similar forms.
About 3 weeks ago I attended an FBAR/FATCA seminar sponsored by Democrats Abroad in Victoria. Thanks to my excellent education at the IBS website there was very little information presented by the accountant that I wasn’t already familiar with. However, from the deer-in-the-headlights expression on many faces and the barrage of questions from the audience it was obvious that many were just beginning to see that they had a serious problem.
A couple of comments from the audience are of interest:
– A woman stated that she and her husband were dealing with an officer regarding an account at RBC and were given a form to sign indicating they had no ties to the U.S. When they said that they were American citizens they were given a different form to sign. I don’t know the details of the form, but it sounded like it was intended to designate whether they were or were not U.S. persons.
– The speaker asked if anyone had been questioned about tax compliance when crossing the border and one man stated that he had been asked by a border guard if he was up to date with his taxes. He answered in the affirmative and apparently had no problem crossing.
@Blaze
TD Waterhouse is provincially regulated by the BC and other provinces securities commission. They have to comply with BOTH federal and provincial privacy laws. TD Canada Trust is a chartered bank under the Federal Bank Act and has to comply with more stringent rules in terms of opening up basic checking and savings accounts. These are the so-called Access to Basic Banking Services regulations enforced by the Financial Consumer Agency of Canada I discussed the other day.
This might be a good opportunity to get the BC Privacy Commissioners Office involved given TD Waterhouse is within her jurisdiction. Maybe you could even get a meeting in person. In terms of the Access to Basic Banking Services rules TD has said in several letters to the IRS the TD Canada Trust division cannot comply with FATCA as long as the ABBS rules remain Canadian law.(The penalty for violating the ABBS rules is 200,000 CAD per violation)
@LadyBug
I would strongly advise anyone to NOT sign any privacy waiver form they find unfamiliar. If the already have any existing account the bank has to give substantial notice before the close out your account(and possibly go to arbitration at IIROC). Additionally you are entitled to a basic checking and savings account no matter what under current law. Your going to see more of the requests for privacy waivers on investment accounts more than on basic checking accounts which fall under the ABBS rules.
@ Ladybug
I’m only too familiar with the “deer in the headlights” reaction. A couple of years after we got back to Canada my husband and I went to the US consulate for a tax seminar. We knew we had to do 1040s and we had been but we had some questions. Quite a few people there didn’t seem to know this though and I swear faces were turning green all around the room. The person giving the seminar actually told them that they would have to back file for 13 years. Yes 13! I remember that vividly. Needless to say the whole seminar became focused on filing and we had no opportunity to ask our specific 1040 questions. BTW, that was back when you could actually get into the consulate without too mush hassle. I guess all those non-filers must have had an inkling that something was up but they weren’t prepared for what they heard that night.
@Tim – I sent a note to my MP the PM, Finance Minister and Foreign Affairs Minister here in Canada. I also sent notes to the Calgary Herald and Global News. I just wanted to see if I could stir anything up and directed them to Isaac Brock Society.
@all- I look at it this way. The U.S. may think that it is so smart with legislating FATCA and getting all of the world’s financial institutions to becoming its agents but it may all blow up in their face.
Just imagine the amount of negative publicity that the U.S. is leaving itself exposed too. These financial reps may have to inquire about your U.S. status but there is nothing stopping them from giving their own commentary on the legislation. They are free to say what they want and there is nothing that the U.S. can do about it. If I were the Americans I would be very worried about how all of this unregulated negative publicity will affect the flow of the wealthy and educated to U.S. shores.
I don’t really find any solace in the fact that these forms seem to only apply to new accounts because that basically means that as a pre-existing account holder that you are pretty well locked into your existing accounts at your existing financial institution. Hopefully the questioning won’t go any deeper than the Canadian I.D. that you supply. But of course if something slips, as happened with iamquincy, about your U.S. connection then you are toast.
In the end even with these modifications you are still better off renouncing U.S. citizenship. None of this does away with the tax reporting and investment restrictions obligations that confronts a U.S. person. Citizenship based taxation still has to go.
It looks like other non-US people have to submit a W-8 BEN as well. So if you do business with the US as well, even if it’s a citizen of a different country, the IRS is going to get a form.
Take Charles Schwab in Hong Kong, for instance: they deal with people from every country, but they still require the W-8 BEN. I guess “US Persons” will have to sign this “waiver” though.
If you left the US 40 years ago to pursue a life in a different country, you’re probably thinking WTF? Imagine me? I left there because I felt like the government was TOO intrusive. This one is over-the-top!
I have just forwarded the TD Waterhouse links to the Director General of Communications at the Privacy Commissioner’s office.
@Tim: Is there a Privacy Commissioner for Ontario? I’m in Ontario (was in Vancouver when I became a Canadian citizen 40 years ago. Tiger is in Vancouver. She was in Ontario when she became a citizen 40 years ago, so it’s easy to confuse us. I and others could contact the one in Ontario. Maybe Tiger and others could contact the one in BC. Folks in other provinces could do the same. It’s important to remember what is provincial and what is federal as Tim has outlined above.
@vin-de-table: Welcome to Brock and Welcome to Canada. I’m sure you will make great contributions to this great country and to this great website.Remember, even as a Canadian resident, you have rights–including the right to not have to provide your citizenship information for banking or investment services.Providing your SIN and driver’s license is sufficient.
BTW Tim, I’m surprised permanent resident card is not listed as ID on TD Waterhouse website. Isn’t that one of the pieces of ID that is acceptable? Of course, once someone provides PR card, that indicates the person is not (yet) a Canadian citizen. Could it be TD Waterhouse is providing a way for the customer to open an account without any discussion of citizenship or suspicion being raised about possible “US person” status?
@Blaze
Only Quebec, Alberta, and BC have full provincial commissioners. For Ontario the Federal Commissioner is the main regulatory body.
The president of the Canadian Bankers Association, Terry Campbell, gave a talk to the Calgary Chamber on May 25th. Although it covered many areas, I did find some of his published speech quite interesting. Discussing a survey, he said,
“Customers also know, and highly value, the fact that banks will keep their private information just that – private.”
The second piece was regarding the ‘problem of extraterritoriality’, “the most egregious case is a U.S. law called ..FATCA”. He says, “The more you know about this U.S. statute, the more concerned you will be and I encourage you to make your voice known.” He says it will be nightmare for Canadian customers.
Link to the doc: http://www.cba.ca/contents/files/presentations/pre_20120525_calgary_en.pdf
@Blaze: http://ipc.on.ca/english/Home-Page/
In Ontario they also handle FOI issues. It’s run by Ann Cavoukian, who is a privacy expert.
The IRS does not get copies of the W-8 Ben, they are kept by the financial institution and can be inspected at any time by the IRS and yes every “US Person” will be asked to waive their privacy, this is a requirement of FATCA that the financial institution is only trying to comply with. Don’t blame financial institutions for this they are only trying to comply with unilateral legislation put upon them by the US congress. Take for example Country A that has a mutual fund that invests in US securities, mutual fund only has Country A resident investors yet it must comply with FATCA and identify every one of its investors and obtain W8-BENs from those investors who have nothing to do with the US, If the mutual fund does not comply 30% withholding tax will be deducted on US sourced income as well as proceeds from the sale of US securities. It’s not easy for non-US citizens as well
@Katrina;
FATCA is not yet the law in Canada for the banks here to have to comply with. So, why not blame a financial institution for instituting this well in advance of the law that would compel them? They are placing their own interests above that of their clients, BEFORE they are legally compelled to. How can you explain that? Last time I looked, Canada wasn’t governed by Congress.
@Katrina;
It is definitely a strike against a Canadian financial institution when it places the interests of the IRS and the US above that of it’s Canadian citizen and resident customers. I don’t think that anyone reading here is going to be amenable to continue to do business with an institution that does that, so long as they have a choice to go elsewhere. Currently, it looks as if this is another reason to use Canadian credit unions only.
@badger- if you read Mr. J. Richard Harvey’s paper, Offshore Accounts: Insider’s Summary of FATCA and its Potential Future, then you come to the sad realization that FATCA will eventually either engulf credit unions or so marginalize them from the banking system as to force them to close.
There is actually no scenario under which any financial institution anywhere is really seen as being exempted from FATCA compliance.
thanks @recalcitrant, I’ll find that and look at it. I realized that as FATCA was designed, if it was implemented, the credit unions would not be exempted. At least at the moment, we’ve heard no examples of them asking for citizenship in advance of FATCA implementation?
*@All
Re: Privacy concerns, FATCA made the London (Ontario) Free Press recently. It surprises me that there is only one comment thus far.
http://www.lfpress.com/money/columnists/david_canton/2012/06/01/19827946.html
@CanadianPat, I think they moved the column, your link didn’t work, but I did find it:
http://www.lfpress.com/money/columnists/david_canton/2012/06/01/19827946.html#/money/columnists/david_canton/2012/06/01/pf-19827946.html
It’s tone is pretty critical, which is good, although it doesn’t really go into the privacy issues that it specifies in the headline. It also requires a facebook account to comment, that may be why there’s not many comments.