In the eyes of the Swiss, the reputation of the United States of America has for various reasons been in sharp decline, and America has been presenting itself to Switzerland less and less as an old friend, and more and more as an enemy. I want to remind our friends in Switzerland, as well as every American in Switzerland, that the US is a friend of Switzerland, and I want to tell you what the Swiss as friends must do.
The US and Switzerland are two of the worlds oldest democracies, and both share the founding principles of freedom and independence. At the time of the American revolution, Switzerland was surrounded by tyrannical monarchies, and its fierce independence and stubborn refusal to submit to these despots earned it the title of ‘Sister Republic’ to the United States of America.
How things can change. In 2010, the US Congress with FATCA decreed that every bank in the world must report to the IRS, or face severe consequences. This is nothing less than an act of war on the sovereignty of every nation. Switzerland must under no circumstances submit to these threats, and we must as friends tell America that they are out of line. Brute force has replaced enlightened thinking, and the language of threats and intimidation have become the norm of US foreign policy.
Swiss politicians talk of appeasing the Americans to preserve our friendship. Real friends however don’t allow themselves to be bullied or intimidated by their friends. America needs to be brought back to its senses, so that Switzerland and America can sort out their differences as equals. Switzerland must not allow itself to be bullied and treated as a vassal state.
This is why I wish to encourage every person in Switzerland who values real friendship between the US and Switzerland to sign the referendum to repeal FATCA in Switzerland.
The Swiss government recently agreed to enforce FATCA on every Swiss bank. They must report on accounts defined as belonging to ‘US persons’. The US government is however the only one who can decide who a ‘US person’ is, and Switzerland has already agreed to accept all future modifications to FATCA.
This is pure bullying against Switzerland, and were any other country to attempt similar legislation aimed at the US, it would be considered an act of war. The criminal actions of a few Swiss bankers are leading to the subjugation of the entire Swiss banking sector (not to mention other sections of the economy), and Swiss politicians have accepted this with hardly a word of protest.
The referendum to stop FATCA has been launched, and a core group of volunteers is fighting tooth and nail to get the necessary 50,000 signatures before the deadline. It’s a difficult struggle though.
The banks and the large parties are too afraid of the US to mount any resistance, and the average Swiss voter doesn’t yet see how FATCA will affect them personally. By the time they do, it will be too late.
This referendum is a small grass roots movement that needs your help.
Here’s what you can do:
– Go to www.stop-fatca.ch, download the referendum sheet (http://www.lldc.ch/wa_files/referendum_fatca.pdf), and get as many signatures as possible. If you can’t sign yourself (you must be Swiss to sign), find a friend who is willing to sign.
Then send the sheet to:
FATCA
Le Lobby des Citoyens
Rue du Conseil-Général 20
1205 Genève
Please try to send your letters before 16 December. The holiday season means that most communes will be closed, and it will be very difficult getting the signatures validated in time for the 16 January deadline. Every signature counts though, so keep them coming until the very end.
If every American in Switzerland could just get one or two signatures, we’d easily have enough signatures, and we would be making a giant leap towards killing FATCA for good.
– We need every volunteer who is willing to help us. We are working hard and setting up stands to inform people and to collect signatures. But we need help. If you have the time, and are willing to stand outside in the ever colder weather, we’d love to have your support. Send an email to: info@lldc.ch or call 022 807 08 32 to find out more.
– Contact your local representatives and political leaders and ask what they are doing about FATCA. The large Swiss parties have sold out the country to protect the interests of the large banks. They are hoping this law will pass unnoticed. We need to make some noise and stir things up.
FATCA is a steamroller coming down on the world economy, and Americans abroad are going to be this law’s first victims. We can choose to fight and stop FATCA in its tracks, and if we work together we will succeed.
Spread the word to as many people as possible, and good luck!
Richard
@bubblebustin
I will see you at hotel oblivion. We will be the two grannies drinking to our ride on the oblivion belt
@northernstar
YES! We’ve got some great company, don’t we?
I wonder when the private(customer) owned credit unions will hold a press conference to tell their shareholders of the massive costs of Fatca. The Swiss system of banking is destroyed for life. Any country stupid enough to sign an IGA or any other kind of agreement will be in turmoil like Switzerland. All by threat from the USA. Terrible!
@NativeCanadian
Canada’s banking system is precarious right now. The PC were not truthful how bad shape Canadian banks are in.. serious problems are ahead.
@NativeCanadian, re; “I wonder when the private(customer) owned credit unions will hold a press conference to tell their shareholders of the massive costs of Fatca”…
Good question.
They have been quiet in terms of alerting or discussing this with their members, and their FATCA advocacy/ information web access is locked. Look under the Advocacy drop-down to FATCA http://www.cucentral.ca/SitePages/login.aspx?ReturnUrl=%2f_layouts%2fAuthenticate.aspx%3fSource%3d%252FSitePages%252FProgramsAndServices%252FFatca%252Easpx&Source=%2FSitePages%2FProgramsAndServices%2FFatca%2Easpx
This is despite the philosophy espoused;
“THE CREDIT UNION DIFFERENCE
WHAT IS A CREDIT UNION?
Credit unions are co-operative financial institutions, owned and controlled by their members. One of the fundamental principles of a credit union is democratic control. As shareholders, all credit union members have a voice in setting their credit union’s direction at the local level”
@Swisspinoy:
The US Program is playing out differently than I would have imagined. The 15-30 thousand USPs living in Switzerland will have spread a low-level contamination across nearly all of the retail banks, i.e., 0.2% to 0.3% of all retail bank accounts in CH will be held by USPs by virtue of their living here and only tiny banks may have the good fortune to be spared by not having a single USP as a customer. Since the retail banks don’t have any idea whether their USP customers have reported the small amount of interest earned on their current or savings account as taxable US income, nearly all retail banks must put themselves as Category 2 and confess to helping USPs to evade to US taxes.
As evidenced by Vontobel, some of the private banks may be able to place themselves in Category 3 since they actually know their wealthy American customers, even though most do not live here, and could determine whether their US tax returns included income from their CH accounts or whether they had entered OVDP.
Scoring sofar:
Category 2
1. Migrosbank *
2. Coop Bank *
3. Bank Linth
4. Valiant Bank
5. Corner Bank
(1-4 are retail banks, 5 is a credit card bank.)
Category 3:
Vontobel (private bank, asset mgmt for wealthy clients)
It is expected that around 95% of the 300 CH banks will place themselves in Category 2, which is an admission to helping Americans to evade US taxes. This will be a propaganda victory for DOJ and should play well in the US press. It will be a hollow victory, however, since the banks’ admission of guilt will be largely based on having accepted USPs living and working in Switzerland as customers.
* Interestingly, Migrosbank and Coop are owned by the two largest grocery chains in CH. Not exactly the banks where wealthy non-resident Americans would bank. The same for Linth and Valiant.
@Innocente
I read somewhere that in order for a bank to qualify for category 3, they have to prove that they have no USPs who aren’t 100% compliant with the IRS. However, not surprisingly, none of the big accounting firms (KPMG, PWC, etc. etc.) are willing to testify for any bank that that is the case. It’s simply too risky for them. No wonder almost all banks will be forced to go for category 3!
@notamused
To be in Category 3 the bank needs to prove that it was sin-free. There have been several reports that the Big 4 accounting firms will not give this attestation but that US law firms may step into this void.
An essay in today’s Neue Zuercher Zeitung laments the fact that there is no differentiation between the banks in Category 2. Nearly all Swiss banks must plead guilty because they cannot prove that all of their USP customers are fully in compliance with US tax law:
http://translate.google.com/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Fwww.nzz.ch%2Fmeinung%2Fkommentare%2Fein-ungutes-signal-1.18202099
Swissinfo.ch has an article on the retail banks, belonging to Swiss supermarket chains, Migros and Coop, joining Category 2. “Migros Bank said on Wednesday that 370 of its 825,000 clients – mostly Swiss citizens residing temporarily in the US or clients with dual nationality – came under the criteria of the scheme brokered by the Swiss and US governments.” 370/ 825’000 = 0.04% of its customers.
http://www.swissinfo.ch/eng/business/Supermarket_chains_sign_up_to_US_tax_probe.html?cid=37516028
Kathryn Keneally, Asst Attorney General responsible for this program, has pushed for a zero-tolerance approach, i.e., one possible non-complying bank customer is sufficient to put a bank into Category 2. It shows a serious lack of judgement. Eric Holder should be looking for her replacement.
@innocente
I believe I’ve read somewhere that under the US ‘pogrom’, Swiss banks will also catch heat for not disclosing to their US customers that the investments they’ve sold them were taxable by the US. They can only get away with it because its Switzerland – a known tax haven, but if banks in other countries like Canada show the same degree of culpability as those railroaded into Category 2 in Switzerland, doesn’t it then become an obligation to try it there too?
MISSION CREEP:
“Mission creep is the expansion of a project or mission beyond its original goals, often after initial successes.[1] Mission creep is usually considered undesirable due to the dangerous path of each success breeding more ambitious attempts, only stopping when a final, often catastrophic, failure occurs. The term was originally applied exclusively to military operations, but has recently been applied to many different fields.”
http://en.wikipedia.org/wiki/Mission_creep
@Innocente, in an ironic note, it was that Eric Holder who admitted that US banks are considered too big to fail and too big to prosecute for their own wrongdoing – including furthering money laundering by their accountholders, and FBAR violations under the Bank Secrecy Act. http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/untouchables/eric-holder-backtracks-remarks-on-too-big-to-jail/
“…In a March appearance before the Senate Judiciary Committee, Holder testified that big [US] banks’ clout “has an inhibiting impact” on prosecutions. As he explained:
I am concerned that the size of some of these [US] institutions becomes so large that it does become difficult to prosecute them … When we are hit with indications that if you do prosecute, if you do bring a criminal charge it will have a negative impact on the [US] national economy, perhaps world economy, that is a function of the fact that some of these institutions have become too large. It has an inhibiting impact on our ability to bring resolutions that I think would be more appropriate….” See also at 1:50 on, http://youtu.be/Z3zwhp5-jXA0
Found this…From a Canadian credit union perspective—the not-so-good news
While delayed for several months, the Final Regulations provide helpful guidance on FATCA classification and compliance to FFIs. However, the US Treasury and the Canadian Department of Finance announced last fall that the two countries are working together on an intergovernmental agreement (IGA) that will provide specific rules on how Canadian financial institutions will comply with FATCA. The IGA will provide the final rules that will apply to Canadian financial institutions and will supersede the final regulations. It is not clear when the US and Canada will finalize this IGA and given that FATCA starts to becomes operational in 2014. We hope to see this process concluded as soon as possible.
It is expected that the US-Canada IGA will clarify the status of Central 1 Credit Union and its members form an “expanded affiliated group” for FATCA purposes. FATCA classification and compliance for Canadian credit unions will become significantly more complex if all or some are part of an expanded affiliated group. Central 1 has requested clarification on this point and we trust to receive an affirmative response in the US-Canada IGA.
Canadian credit unions that will not qualify as deemed-compliant will be required to register become a participating FFI. While the expected US-Canada IGA will supersede the final regulations with respect to the governing rules on how participating FFIs in Canada will need to comply with FATCA. However, in the absence of a US-Canada IGA, credit unions that are not deemed compliant should use the final regulations as a base for FATCA compliance. Canadian credit unions, along with other Canadian financial institutions will need to be flexible when the IGA is eventually agreed to and released I guess they are silently working on an IGS and screwing Canadians behind our backs Transparency?
@NativeCanadian,
and how do they justify the silence on the topic re their members?
Between a rock and a hard place I’d still pick the credit unions over the banks anytime, but they need to think hard about how they are handling it – choosing not to tell their members anything.
Are these institutions afraid that we’ll pull all the assets we can out? After all, it is our money is it not? We OWN it. AND shares in the credit union.
Makes me wonder if alerting the Credit Unions “Members” might be a way to get the media’s attention to this. I’d be willing to bet less than 5% of the credit union’s member/owners have no idea what they are about to pay for and why…….
Article in SwissInfo with the judge who brought a bank down:
http://www.swissinfo.ch/eng/business/US_is_no_bully_says_judge_in_Swiss_bank_case.html?cid=37528014
Love his trying to justify the US imposing its laws on others. If you use the argument “because it harms us” you could do anything. Impose trade tax/sactions because it harms us, etc. Sounds pretty much like a bully to me.
A blogger writes in his column today that Raiffeisen, a cooperative retail banking group in Switzerland, will place itself into Category 2. Reader comments to his blog include:
1) Raiffeisen produces account documents in the three national languages, French, German and Italian, and not English. Considering the poor foreign language abilities of Americans, it is unlikely that Raiffeisen was actively pursuing American accounts.*
2) Another reader commented about Raiffeisen that he didn’t know it was illegal to open a bank account for an American but it has since been so determined that it was.
If banks in Switzerland (or other non-US country) are fined by the US for maintaining bank accounts for Americans living and working Switzerland (or other non-US country), why would a Swiss (or other non-US) bank allow an American to bank with it in the future? Has Kathryn Keneally, DOJ Asst Attorney General responsible for this program, thought this through? Why hasn’t the DOS intervened on behalf of Americans abroad? The future impact on Americans abroad from this DOJ program is rather predictable.
* – The Tages-Anzeiger made a similar comment about Migros Bank this week.
Blog on Raiffeisen:
http://insideparadeplatz.ch/2013/12/13/heck-suchte-vincenz-im-us-business/
Tages-Anzeiger article on Coop and Migros banks:
http://www.tagesanzeiger.ch/wirtschaft/unternehmen-und-konjunktur/MigrosBank-und-Bank-Coop-vermuten-Steuersuender-unter-Kunden/story/11941339
@Badger:
In an interview with the Neue Zuercher Zeitung, Federal Judge Jed Rakoff, who was responsible for the Bank Wegelin case, says that the fines should not be so high to endanger the existence of the bank. Something that was apparently learned from the criminal indictments of Arthur Andersen and Enron was that these were death sentences for these companies, causing around 30,000 employees at Andersen to lose their jobs even though 99% had no contact with Enron. (It was Michael Chertoff, an overzealous prosecutor, who pulled the trigger on Andersen. He later gained entry into the hall of infamy as DHS head and its disastrous Hurricane Kathrina efforts. Kathryn Keneally may prove that she has as little sense with the US Program as Chertoff had with Andersen).
Rakoff also says that if a bank has not actively pursued American customers it should not have to plead guilty to aiding tax evasion. This is of course differs with the US Program which essentially forces any Swiss bank with USPs as customers into Category 2, similar to how US plea bargaining is oftentimes done.
http://translate.google.com/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Fwww.nzz.ch%2Fwirtschaft%2Fwirtschaftspolitik%2Fbusse-soll-die-existenz-einer-bank-nicht-bedrohen-1.18203419
Swiss bank PostFinance to join U.S. tax deal http://dlvr.it/4VgGMn
Private bank and securities firm Vontobel has also said it is taking up the U.S. offer, but put itself in the category of institutions that have not committed any U.S. tax-related offences and are therefore exempt from penalty payments.
@nativeCanadian
Sweden has also been saying they are trying to negotiate something different than the terms of the other IGA’s, something more like OECD’s principals. And I think the budget included buried language allowing them to implement it. The last proposal went to US in June, and they are still waiting.
GenevaLunch.com has posted an article on PostFinance signing up for Category 2. With 2.9 million customers and CHF 104 billion in deposits, this would be the largest bank that has joined the DOJ’s program Category 2 to-date. If the goal is to extract as much money from Swiss banks as possible, PF should be an easy mark for the DOJ because, under its charter, it has to accept accounts from anyone with a close relationship to Switzerland (called “service publique” or “universal service”). Also, the accounts are normally opened by Swiss Post employees who, at the end of the day, are postal employees and not better-trained bank employees regarding banking. PF received a banking license “lite” in June which allows it to continue offering transaction and savings accounts but does not permit PF to make loans for its own book, as before.
http://genevalunch.com/2013/12/13/post-finance-cites-uncertainty-joins-us-programme-banks/
In conjunction with obtaining a bank license, PF obtained a revised charter that will permit it to exclude groups of people from its universal service. Although it has not been exercised so far, this particular change can be directed at USPs living in Switzerland (and possibly is the reason it was added):
“b) Special rules for payment transactions as a public service:
PostFinance can prevent customers from using payment transaction services in accordance with postal legislation (public service) if carrying out the service would be contrary to national or international provisions related to financial market, money laundering or embargo legislation or if there is a danger of
serious legal and reputational damage.
A customer may be partially or fully excluded from the named services in particular:
– if PostFinance or its employees would be breaching international agreements or sanctions, legal provisions, regulatory specifications or official rulings by supplying the customer in question with the public service;
– if PostFinance would suffer significant financial risks by allowing the customer to benefit from its services;
– if PostFinance would incur undue expenditure by monitoring the customer relationship in order to meet its obligations of due care;”
https://www.postfinance.ch/content/dam/pf/de/doc/about/info/compar/compar_pf_gtc_en.pdf
MedeaFleecestealer
perceived harm is exactly how US laws work, whether for banking or trade or anything else
The US attitude is “we are the best” if we are losing( (loss being the perceived harm) the other party must be cheating. The US policy on foreign accounts is “no tax, no tell”
the crime of the Swiss banks was doing to the US what the US was doing to the world.
The Swiss SVP wants to put FATCA on ice
http://bit.ly/1cGxLNw
They seem to be just learning of DATCA lite and the U.S. Banking association law suit.
@Innocent, Badger
Guilty until proven innocent. The banks themselves find the best course of action is to recommend to the customer that they enter OVDP – which is an admission of guilt by the taxpayer, and where the taxpayer implicates his banker in the crime.