I am temporarily suspending wall of shame inductions but I think the following blog post is rather interesting. Ann Hollingshead and the Task Force for Financial Integrity & Economic Development have been big FATCA supporters for many years whom I sparred with back in the early days of Brock. At one time she was also critic of Jim Flaherty for as she put it interferring with the soveriegn right of the US to make its own tax policies. Clearly she knows about our criticism and has been stung by it(She in fact singles out American Citizens Abroad for as she puts it hyperbole). I think this might be a wonderful opportunity to bring our criticism back home to her and let her know about our latest activities. (The actually point of the blog post is to say how great the IGA’s are).
A Strong, Sustainable, Future for FATCA and Tax Compliance.
Why are you suspending Hall of Shame Inductions? I always enjoy them!
“opprobrium” Oh, how impressive. ;-P
In the Task Force’s ideal model, these agreements would require both the U.S. and partner governments to collect data from their own financial institutions on income, gains, and property paid to non-resident individuals, corporations, and trusts and then automatically provide that data to their partner countries. In practice, these may look slightly different.
If it were really about non-resident individuals, far fewer people would have anything to complain about. Margo in the comments section of the article noticed the same thing. Maybe this Ann Hollingshead needs to learn the rules of what she’s writing about.
We just need more posts like this one from Nigel Green to counter this:
FATCA flatulence.http://www.nigel-green.com/2012/11/16/us-treasury-should-be-called-to-account-on-economy-damaging-fatca/
I wished I knew more about this guy’s level of influence in the financial world. He has been on the subject consistently for a while now. Seems like a good alliance partner.
When the oppressor doesn’t like the cries of pain coming from those whom she is oppressing, she calls these cries of distress “opprobrium”. This is the essence of Paternalism.
Politically, Ms. Hollingshead strikes me as kind of a far-left anti-matter twin of Barbara Amiel, though they obviously share a similar disdain for all us little people who dwell in reality. She hasn’t even seen fit to respond to any of the comments at the end of her article, probably realizing that they are much better researched and far more accurate than hers.
@Just Me
just tweeted him our PR at newswire. Perhaps he’ll contact us? I’ve read his stuff, seems knowledgeable to me.
The FATCA Model Agreement Nr. 2, published on November 14, 2012, has a rather interesting clause for “local FFIs”. To the extent that “local FFIs” have policies/ procedures that discriminate against resident Americans, they will NOT qualify as “deemed-compliant FIs”. Please see excerpt below (highlight added):
“II. Deemed-Compliant Financial Institutions.
A. The following categories of institutions are Non-Reporting [FATCA Partner] Financial Institutions that are treated as deemed-compliant FFIs for purposes of section 1471 of the U.S. Internal Revenue Code:
1. Small Financial Institutions with Local Client Base
j. The Financial Institution must not have policies or practices that discriminate against opening or maintaining accounts for individuals who are Specified U.S. Persons and who are residents of [FATCA Partner].
http://www.treasury.gov/resource-center/tax-policy/treaties/Documents/FATCA-Model-2-Agreement-to-Implement-11-14-2012.pdf
@innocente
Is this like the school yard bully saying that if we don’t play with his friend, he’ll beat you up?
That’s brilliant, in a sick and disgusting sort of way. Treasury’s propaganda experts will no doubt loudly toot their own horn on this, framing themselves as “fighting against anti-American discrimination by evil foreign banks”. Of course, the real effect of this will be to raise the cost of compliance necessary to become a “deemed-compliant FFI” even further, making it a less attractive option for banks to pursue in the first place — and this on top of the existing stupid rules like forbidding advertisements for US dollar accounts on bank websites.
There is an article in today’s Swiss newspaper NZZ on the FATCA model agreement. The journalist considers it ironic that the model agreement would prohibit deemed-compliant local banks from discriminating against resident Americans. Following is a relevant excerpt (translated):
“Certain to cause a stir in Switzerland is a clause in the model agreement. This prohibits local banks, who want to benefit from the deemed-compliant simplifications, from rejecting as a matter of policy American customers who live in Switzerland. This
“discrimination prohibition” is not without irony since the U.S. has done everything possible with FATCA to keep Swiss banks away from American customers. But Americans living abroad are also voters, and the biting criticism of American Citizens Abroad towards the law was not without effect in Washington. As such, the organization complained about the fact that U.S. expats were struggling to open local accounts. The “discrimination prohibition” seems not to apply generally everywhere, since it is mentioned only in the (model agreement) section on local banks.”
http://www.nzz.ch/aktuell/wirtschaft/wirtschaftsnachrichten/usa-legen-fatca-vertrag-vor-1.17813385
Due to FATCA it is expected that American and non-US corporations will be increasingly disinclined to offer overseas jobs to Americans in the future and instead many director-level positions in overseas subsidiaries requiring signatory authority will go to other native English speakers such as Brits, Canadians, etc. The CIA may find this regrettable. As many of you may recall, Belgium-based SWIFT (Society for Worldwide Interbank Financial Transmissions) was led for many years by an American CEO, Leonard Schrank. After 9/11, contrary to Belgian privacy laws, he agreed to provide financial data to the CIA. This went on until 2006 when the activity was reported in the NY Times and he resigned in 2007, apparently forced out.
http://www.nytimes.com/2006/06/23/washington/23intel.html
For purposes of data redundancy, SWIFT has run a mirror-image data center in the US that replicates the transactions at its main data center in the Netherlands. To avoid the prying eyes of the CIA, it has been shifting its non-US transactions to a new data center in eastern Switzerland.
“The “discrimination prohibition” seems not to apply generally everywhere, since it is mentioned only in the (model agreement) section on local banks.” — in otherwords, the point is to handicap small banks in their competition against big competitors. Small banks are left between a rock and a hard place. They can become local FFIs, forswearing international expansion and obligatorily taking up the massive risk of accepting US customers (and being accused by some future administration of “aiding tax evaders”). Or they give up on local FFI status and have to bear the full brunt of FATCA compliance, whose fixed costs they will be amortising over a smaller number of customers than their large international competitors.
In the mean time, US banks will face no such limitations …
More FATCANATICs applauding the creation of GATCA Just in case there was any doubt what FATCA is about.
GFI Applauds Treasury for Work Expanding FATCA toward Automatic Tax Information Exchange
@Just Me
Interesting slogan they have for their web site:
“Advocating a U.S. foreign policy based on cooperation, demilitarization and respect for human rights”
How ironic.