I just read a report from the Credit Union Central of Canada, which seems to indicate that most Canadian credit unions will be at least partially exempt from FATCA.
Even credit unions over the 175 million asset limit (which are MOST credit unions) appear to be partially exempt. IF less than 2% of their customers are non-resident ‘US persons’ they only have to report those non-residents of Canada under the FATCA IGA presuming I am interpreting this report correctly.
Am I dreaming? I sure hope not, and if not, we should have a HUGE BANK PROTEST DAY by moving all our funds out of the big banks and into a credit union!
Select the article titled: “FATCA IGA & Guidance provide much needed details, Mar 11, 2014” from:
http://www.cucentral.ca/SitePages/Publications/Connections.aspx
@WhiteKat
I don’t find anyone irritating… ok… my significat other perhaps… lol.. I find this fatcrap pissing me off. I just wanted to calm the person down… because as I read the person’s post… they seem to get madder & madder… that is not good for them at all. Deep breathe… it will work out… if u rant & rave… its fine… but there is no reason this crap destroys ones sanity… I admit… I can’t spell…lol
Our saviour has arrived
The Portman Letter
https://www.facebook.com/republicansoverseas/photos/a.197014807148989.1073741828.187406564776480/240684266115376/?type=1&theater
The Republicans WILL win in the mid terms and that’s the end of FATCA in my opinion
@US_Person_Foreigner,
Its OK. my signifiCAT other pisses me off too!
And this fatCAcrap even more so. There is medicine in humoUr!
@ChearsBigEars
Problem with all of them saying repeal… repeal… we have seen no real effort at all… Republican….. I feel they are jumping on this band wagon to raise funds & garner seats in gov’t… Until I see crap really being done other then letters here & there… I don’t believe them… My biggest fear is that if it goes into effect… we may get pulled into that giant database… we could never get out… then everyone & their mother will have a road map of our life… which is none of their dang business.
@Chears,
I need to get my glasses (and some sleep) before I read this Portman Letter. I hope you are right about the saviour arriving. I will try to reflect on this when I go to bed and hopefully have pleasant dreams for a change.
WhatAML…..no a federal CC system destroys the concept of local investment and the members will NEVER go for it
I point you to this from BC Central, a private document leaked to someone here if I recall
http://bsmlegal.com/PDFs/Central1.pdf
@US_Person_Foreigner,
It is good to have passion and be alarmed, but when it interferes with your effectiveness, its not such a good thing. Breathe deeply. We will solve this thing.
FATCA has been renamed
Fascist America Taxation and Communists ASSociation .
@ChearsBigEars
Thank goodness Posey is my representative – a lot fewer letters to write, although I’ve still written him a few. No response, unless you count newsletters.
Fear not, Russia is about to bring the banking system down so get cash and keep some safe out of the financial institutions
http://www.businessinsider.com/wikistrat-the-next-russian-military-invasion-2014-3
@WhatAmI,
I had raised the question of whether credit unions who take up Flaherty’s offer to transition to being federally regulated institutions (in order to expand nationwide rather than being confined to serving members only within their province) rather than remaining provincially regulated is an emerging issue re the FATCA IGA implementation.
The issue of federal vs. provincial regulation and jurisdiction was raised in the March 10th, 2014 letter from the BC FIPA Freedom of Information Privacy Association in their submission to the Finance Department about the FATCA IGA http://fipa.bc.ca/library/Reports_and_Submissions/MoF%20consult%20sub%20signed%20Mar%2010%202014.pdf
which Blaze has posted it on the Maple Sandbox site with this comment re;
“…..a four page Submission by the B.C. Freedom of Information and Privacy Association to Finance Canada…”
“….BCFIPA challenge several aspects of the IGA as well as question the jurisdiction of the federal government to regulate credit unions which fall under provincial jurisdiction.”
AND,
this http://www.fin.gc.ca/n14/14-010-eng.asp is the notice I have been trying to draw attention to; ‘Minister of Finance to Provide Temporary Transitional Support Under the Federal Credit Union Framework’
January 24, 2014 – Ottawa, Ontario – Department of Finance
“Finance Minister Jim Flaherty today announced the Government’s intention to enhance the federal credit union framework by providing temporary transitional support to eligible provincial credit unions that have provincial acceptance to move to the federal framework.”
I have no special insight into this. I am underscoring the BCFIPA comments, and asking whether the fact that the credit unions are (all? mostly? ) provincially regulated adds another potential and important obstacle in terms of FATCA implementation as applied to ‘small’, ‘local’ credit unions. I don’t know how/whether the federal government can unilaterally force each and every province to accept the application of FATCA to credit unions which are at least in part/or totally under provincial control. Wouldn’t that require provinces to change their regulations to match? Can the federal government force the provinces to? Wouldn’t that delay things? What if some provinces refused ex. Quebec (because taxation is a sovereignty issue)?
I don’t know the answer.
But, I think that it is NOT in our or Canada’s interests to have our credit unions opt to move to being federally regulated if that removes the provincial layer of oversight/regulation – if that layer acts as a barrier or obstacle to the smooth implementation/imposition of FATCA on them. And the reason/motivation for some credit unions to consider moving to federal regulation is in order for them to be able to expand operations to nationwide. Which, would tend to make their total asset holdings larger – putting them into a less advantageous category re FATCA deemed compliance – since holdings of “smaller deposit-taking institutions” was defined as those holding assets of “less than $175 million” I think.
@badger stop worrying in my opinion. Not a remote chance of it happening, not a hope in Hell and the Feds cannot do anything about it as they don’t have jurisdiction over the Provinces. If it does then that’s the day credit unions become banks. Credit union customers don’t want to become regulated federally.
Read this article and you will see why it is an impossibility for credit union co-ops to go nationwide
http://www.coopscanada.coop/assets/firefly/files/files/E-Credit_Unions_Nov_4_13_.pdf
I think all of the 10 credit unions that I’ve been talking about are provincially registered, and 9 of them have online banking, and most or all of these have online applications. They all offer Canada-wide services. Some have Canada-wide branches. I wonder if the online banking is connected with their ability to offer services outside of their provinces? Just a guess, but I mention it because offering national service doesn’t seem to be tied to federal registration. Half of them are in Manitoba and have MB deposit insurance, which is unlimited, unlike CDIC which is $100K.
With this in mind, I wonder what the attraction would be to go to federal registration, and why the feds are pushing for it. I apologize if one of the posts above explain it; it’s all Greek to me.
Not all credit unions will be exempt from FATCA. Here is a reply I just received from a question I sent to mine:
Libro is Ontario’s second largest credit union and the eight largest in Canada. It is ironic that a credit union that was established over 60 years ago for Dutch immigrants who could not get financial services is now preparing to discriminate against another group of Canadian immigrants (most of whom are citizens).
I replied:
@Blaze
Strange reply.
The IGA says the deemed-compliant designation is for FIs who do not allow non-Canadian residents to hold accounts. It doesn’t matter from what I’ve read if the customers are US persons, as long as they reside in Canada.
I just phoned Libro and was told they don’t accept accounts from people outside of Ontario (even though their online application allows you to choose any province) let alone outside of Canada. I have tested other online applications and found that if you enter an outside province, they may stop you after you click APPLY and say you are not eligible. Libro’s form could be like that but I didn’t want to actually apply (and the button send SUBMIT, not NEXT PAGE).
I suspect that the person who answered your letter knows more than the help desk person who took my call, and more than I know. However, the reply you got doesn’t convince me that they are not eligible to be a non-reporting FFI. I really would like to understand their position. Do you feel like pressing for more details?
Thanks for that @Blaze re LIBRO.
This is weasel wording from LIBRO:
…… ..”Much has been said about FATCA’s extra-territorial reach beyond the US and implications for the sovereignty of Canada and other countries. Many of us at Libro certainly have our own personal opinions on that issue but, as an organization, we must do what is necessary to continue to provide quality financial service to our owners in a manner consistent and compliant with the laws of Canada and Ontario…”
Contrast with the strong anti-FATCA statement from VanCity:
https://www.vancity.com/AboutVancity/News/AdditionalNews/FATCA/
‘FATCA: Vancity’s response to Canada-U.S. intergovernmental agreement on the U.S. Foreign Account Tax Compliance Act’
February 18, 2014
“Vancouver, B.C. – On February 5, the federal government announced an intergovernmental agreement with the United States that paves the way for the U.S. Foreign Account Tax Compliance Act, commonly known as FATCA.
The intergovernmental agreement outlines FATCA requirements including specific exemptions for Canadian entities. The agreement is designed to improve international tax compliance through enhanced exchange of information. FATCA requires financial institutions around the world to create information collection and reporting systems for accounts held by American taxpayers residing outside of the United States.
Over the past years, our Board of Directors spoke out against FATCA, and took a leadership role among Canadian financial institutions to express our opposition, based on FATCA’s wide-reaching and potentially negative impact on:
personal privacy and freedoms
due process
financial well-being and
national sovereignty.
Our Board’s continuing concern is that issues regarding privacy, human rights and other interests of Canadians remain fully protected under existing Canadian laws……..”…
and see also FATCA criticism from CUNA (US)”the largest national trade association in the United States serving America’s credit unions.” http://www.cuna.org/Stay-Informed/News-Now/Washington/Republican-senators-oppose–FATCA-in-letter-to-foreign-based-citizens/
LIBRO may have decided that it had no choice but to comply, but that doesn’t mean that it is right or ethical to resort to convenient (and snarky sounding) rationalizations when speaking to its ‘member’ ‘owners’. Honesty and being forthright about the basis for their decision is a better policy.
And I wonder what was behind that reference to the laws of Ontario?
“WhatAmI The person who sent me the e-mail is the Vice-President. Well, he was the VP. His new title in Libro`s warm-fuzzy language is Governance Coach and Corporate Secretray“ The CEO`s title is “Head Coach and CEO`(I kid you not!)
I think they can be non-reporting. Either they have decided to report anyway or they have not bothered to check it out. Either way, I`ve lost my faith in them.
In fact, this reply (especially the offer to refer me to an “accountant with specific expertise in U.S. taxation“!) makes the `comfortable` FATCA banking experience promised by my bank look good.
I`m in the process of trying to find other credit unions in London. It`s not looking good. Libro has most of the market wrapped up. Meridien and Your Neighbourhood Credit Union seem to be the other two viable options.
@Blaze
I just wrote to the Libro CEO to ask why they have decided against, or are not eligible for, being a non-reporting CFI.
I’m new to the world of credit unions, but I do understand the community spirit of a local credit union. However, if I was OK with getting between 0.1 and 1.0% on my savings deposits I would have stayed with RBC. There are several credit unions available Canada-wide that pay between 1.3 and 1.9%. TFSAs and especially GICs pay even higher. I don’t need to find one based in Calgary, as many have online banking. Some you can deposit cheques by taking a picture of the front and back with your smartphone and it’s transferred to your account.
I’m just wondering if you really need a new CU to be located in London?
@BLAZE…ET AL…
Libro Credit Union does not appear to be a run of the mill credit union for members by members.
They provide business banking and they also sell investment products. I saw that on their website.
If anything that complicates matters.
You need to have a credit union that serves only residents in Canada and residents being defined as individuals not businesses and they need to provide savings accounts/cheque accounts and nothing securities related.
@George: Thanks. I just checked the other wo “credit unions” in London. Bacingoth Meridian and Your Neighbourhood CU also offer small business and wealth management services, which will put them in the same category as Libro.
Someone who used to work for a credit union told me a few weeks ago most of the smaller credit unions have merged with the larger ones due to all of the regulations and other complexities they are facing. That seems to be what is happening here and why Libro and the other two (to a lesser degree) have all the local credit union business tied up. He said we should expect to see more mergers in the future.
@WhatAmI: It may be old school, but I prefer to deal with financial institutions where I live. However, my neighbourhood branch (where I have been a customer for 34 years) and my credit union (where I have been an “owner”) for 15 years have shown me clearly they don’t care about me or my privacy. So, I think it may be time to check out my other options.
In the meantime, IRS has finally admitted they are not going to be able to handle FATCA. Here is a new thread I started at Sandbox today with a link to an article at Bloomberg (after Hazy first posted the article in the What’s New thread there. Thanks Hazy!)
http://maplesandbox.ca/2014/irs-admits-it-cant-handle-fatca/
Senator John Fleming, R,LA-4 – Bossier
“Again, class warfare never created a job. That’s people that will not get jobs. This is all about creating jobs. It’s not about attacking people who make certain incomes. You know, in this country most people feel that being successful in their businesses is a virtue, not a vice. And once we begin to identify it as a vice, this country is going down.”
Wish that it would be good to tell him what Obama is doing to American’s Abroad. Because FATCA is class warfare against those who live outside of the USA by those who live within it’s borders.
Hopefully Coast Capital won’t sell those of us IBS’rs who use their services down the river. If they try, we’ll be switching to VanCity.
…and we’ll also buy gold .99% pure bullion just in case…
Here is KPMG’s “Submission to the Department of Finance Canada” about FATCA:
http://www.kpmg.com/Ca/en/topics/fatca/Documents/kpmg-submission-fatca-iga.pdf
There is a section surrounding the “deemed-compliancy” issue:
Based on the response I received and posted above from Libro Credit Union (where I have been a member for 15 years), this morning, I transferred a large sum of funds to Your Neighbourhood Credit Union.
YNCU is based in southwestern Ontario. They recently began operation in London after merging with Boomerang, which was the credit union for municipal, provincial, school board, Labatt and GM employees.
I will transfer more when my RRSPs are up for renewal and will also be transferring assets from TD Canada Trust to Your Neighbourhood. Your Neighbouhood even has comfortable purple (my favourite colour!) chairs–not green ones like TD!
Read the following from YNCU Director of Risk Management, contrast it to the above from Libro and you will understand why I made this decision:
Good morning,
We appreciate the opportunity to earn your business and are more than pleased to provide you with information with respect to your FATCA inquiry. Without implying that you are either an American citizen or born in the United States, I would like to confirm the status of FATCA in Canada which was the original question you asked. Your personal tax residency would not alter our response.
The Canada Revenue Agency and the US Internal Revenue Service have had a tax treaty in place for an extended period of time. With the introduction of FATCA in the United States, governments around the world have revisited their tax treaties with the United States. Very recently, the Canada Revenue Agency and the US Internal Revenue Service have agreed upon an inter-governmental Agreement. With the nature of your questions, you can refer to the full Canada Revenue Agency Agreement here: http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/menu-eng.html
When Your Neighbourhood Credit Union receives a new Membership Application we require the following information:
An original valid, unexpired government issued photo identification in one of the following forms:
1. Canadian Driver’s License
2. Ontario Photo Card
3. Canadian Passport
4. Canadian Record of Landing
5. Canadian Permanent Resident Card
6. Canadian Certification of Indian Status
7. Canadian Birth Certificate
8. Foreign Passport
Your physical address
Your mailing address (if different)
A contact telephone number
Your Social Insurance Number
Politically Exposed Foreign Person confirmation (whether you are a Political person with a foreign government, or directly related to one)
Confirmation that you are/are not operating the account(s) at the instruction of any third party
The intended use of the account(s) being opened.
The purchase of a $10 share, which grants Membership in the Credit Union and a vote as a Credit Union Member.