On July 2 2014 my understanding is that Canada’s banks will be asking (at least) new account holders questions and employing a variety of approaches to establish U.S. personhood. These questions will violate Canada’s Charter Of Rights and other laws. Many of us also wonder whether the Silent Majority out there feels that such questions have no consequence.
Coming to a Canadian bank near you?
We need to know the actual questions and approaches and are focusing first on questions about U.S. personhood that will be asked by Canada’s major banks when Canadians open a NEW PERSONAL CHEQUING account after July 1. I suspect that different banks may ask different questions.
When you have this information, please provide in your comments these questions to be asked and I will update the top of this post.
[Please also read the disturbing comments below from @Pollyanna, who reports that one Canadian bank actually used information provided in casual conversations with the account manager to help establish whether the account holder is a U.S. person.]
My local Canadian bank branches provide this information on U.S. questions asked or not asked when opening a new account (this info may all be incorrect; please correct):
SCOTIA BANK: “Are you a U.S. person for tax purposes?”
http://www.scotiabank.com/ca/en/0,,6098,00.html
TD BANK CANADA TRUST: “Are you a U.S. citizen” AND “Where were you born?”
TD’s web information page: http://www.td.com/fatca/index.jsp
See: LM Correspondence with CustomerCare, TD for others to consider in relation to their own FFI’s web information and their relationship with their FIs.
HSBC CANADA: “Do you hold multiple citizenship” AND “What is your place of birth”
http://www.expat.hsbc.com/1/2/hsbc-expat/services/expat-tax/tax-matters/fatca?WT.ac=HBIB_14_5_29_home_small_pro_FATCA_Find_out_more
NEW HSBC information consent
CIBC: Local branch will receive info July 2.
Note: the link below is for CIBC World Markets, which deals with Wholesale Banking (Corporate & Institutional) as opposed to Retail Banking (Personal & Small Business). We have yet to see a CIBC FATCA page specifically written for Retail Banking clients. Perhaps as of July 2, once local CIBC branches receive info, there will be such as page on the CIBC website.
http://www.cibcwm.com/cibc-eportal-web/portal/wm?pageId=fatca&language=en_CA
BMO: “Do you have any other citizenships” (tentative per @Anne Boleyn)
http://www.bmo.com/home/about/banking/foreign-account-tax-compliance
RBC ROYAL BANK:
http://www.rbc.com/aboutus/fatca.html
I would be very skeptical of this information:
“If you open a new account and provide two pieces of ID that are not U.S. tainted and do NOT INCLUDE A CANADIAN PASSPORT (e.g., Canadian driver’s license and social insurance number are ok) and the bank has no other evidence to indicate that you are a US person (e.g., you never told the bank by mistake) no U.S. questions will be asked.
However, should you PRESENT A (TOXIC) CANADIAN PASSPORT at the time of opening an account, YOU WILL BE ASKED whether you do or do not have a U.S. place of birth.”
The way to stop the questions from being asked is to go to:
@WhatAmI – my god that is F…ed up! But hey…I know how I would answer every one of those questions….”no”, “no” and “no”
The links provided to the FATCA information for each of the big five banks is helpful. I did want to point out that the link for CIBC is for CIBC World Markets, which deals with Wholesale Banking (Corporate & Institutional) as opposed to Retail Banking (Personal & Small Business).
In fact, I have yet to see a CIBC FATCA page specifically written for Retail Banking clients as of this moment. Perhaps as of July 2, once local CIBC branches receive info, there will be such as page on the CIBC website.
I just noticed this for Alterna CU, there is no date on the webpage, but I’ve looked for it before and I don’t think it was there before:
https://www.alterna.ca/OnlinePolicies/SecurityAndPrivacy/FATCA/
FATCA
What is FATCA?
FATCA stands for the Foreign Account Tax Compliance Act. It is a new piece of legislation to help counter tax evasion in the US.
The purpose of FATCA is to encourage better tax compliance by preventing US persons from using foreign banks and other financial organizations to avoid US taxation on their income and assets.
A significant number of countries worldwide have either signed or are expected to sign inter-governmental agreements (IGAs) relating to FATCA compliance with US government.
What is the intergovernmental agreement (IGA)?
The Canadian government had entered into an intergovernmental agreement with the U.S. government under the existing Canada-U.S. Tax Convention. The requirements of the IGA will be reflected in changes to the Income Tax Act (Canada) and financial institutions in Canada are required to comply with the changes under Canadian law.
Under the IGA, financial institutions in Canada will report relevant information on accounts of U.S. persons to the Canada Revenue Agency (CRA) rather than directly to the IRS. The CRA will then exchange the information with the IRS through the provisions in the existing Canada-U.S. Tax Convention.
More information on the IGA can be found on the federal Department of Finance and CRA websites at these links:
http://www.fin.gc.ca/n14/14-018-eng.asp
http://www.cra-arc.gc.ca/tx/nnrsdnts/nhncdrprtng/menu-eng.html
How do I know if I am affected?
FATCA legislation will affect both personal and business customers who are treated as a ‘US person’ for U.S. tax purposes. The FATCA legislation will also affect certain types of businesses with U.S. owners.
The term US person includes the following (but is not limited to):
A citizen of the U.S., including an individual born in the U.S. but resident in another country (who has not given up their U.S. citizenship)
A person residing in the U.S., including US Green Card holders
Certain persons who spend a significant number of days in the U.S. each year
U.S. corporations, U.S. partnerships, U.S. estates and U.S. trusts.
For more information regarding how FATCA may affect you please contact your tax professional.
When will the FATCA legislation becomes effective?
The FATCA legislation comes into force on July 1, 2014. Alterna has worked to ensure it is compliant with the requirements of FATCA and the IGA.
What are my obligations?
Please contact your tax professional to determine your status under FATCA.
Will financial institutions have to disclose information about registered plans?
The following registered plans will be exempt from reporting:
Registered Retirement Savings Plans (RRSPs)
Tax Free Savings Accounts (TFSAs)
Registered Disability Savings Plans (RDSPs)
Registered Pension Plans (RPPs)
Registered Retirement Income Funds (RRIFs)
Pooled Registered Pension Plans (PRPPs)
Registered Education Savings Plans (RESPs)
AgriInvest Accounts
Deferred Profit-Sharing Plans
Thanks, badger.
What reckless and misleading information given, especially to those reading all of this for the first time! These financia institutions and the Canadian government should be sued if the US comes for anyone who heeds this PR information, thinking “I’m OK.”
@calgary, I know what you mean. I think these two sentences were meant to be read together like so; “…… Will financial institutions have to disclose information about registered plans? The following registered plans will be exempt from reporting:”…..
And it should have made clear that the reporting or lack being discussed is that done by the CU, and does not describe the reporting required by the US of the individual accountholder if deemed a ‘US taxable person’.
Interestingly, the webpage is not dated at the bottom. I have been monitoring the site for some time now, and have not seen it before. It has a better tone than Meridian CU does, especially as Meridian makes this offensive and baseless claim “..We expect that FATCA will not have any impact on most of our Members..”.. http://www.meridiancu.ca/meridian/legal/FATCA/Pages/default.aspx and I note that it is the same wording as this one https://www.copperfin.ca/Personal/AboutUs/MediaCenter/ They are borrowing the wording from somewhere.
And I note this wording by Meridian CU regarding their FATCA reporting of accounts belonging in part by joint account holders who are NOT USpersons, wherein the WHOLE acct, including transactions, etc. will be reported anyway – REGARDLESS of the RIGHTS of the NON-USP accountholder. See Meridian FATCA FAQs;
“FAQ 15. How are joint accounts handled under FATCA?
If at least one of the joint owners qualifies as a U.S. person, any required reporting would treat the U.S. person as the owner of the entire account. If more than one of the joint owners are U.S. persons, any required reporting would treat each U.S. person as the owner of the entire account.” from http://www.meridiancu.ca/meridian/legal/FATCA/FAQ/Pages/default.aspx
Note that the baseless claim that FATCA won’t impact most accountholders is also being made on the First Ontario CU site; “We expect that FATCA will not impact most of our Members.” https://www.firstontariocu.com/Personal/AboutUs/OnlinePolicies/FATCA/
There are no agreed upon official statistics being offered anywhere about just how many USPersons are in Canada, so how can these institutions make these irresponsible claims?
And some of these CUs are in border and heavily populated areas like S. Ontario where one can’t walk without falling over an unexpected dual or a permanent resident or a USPerson or a greencard holder, or snowbird (who might be deemed one), someone married to one, in business with one, parent or child of one, co-signatory with one, POA held by one, etc.
So they have no reasonable or reliable or responsible basis to soothe their Member SHAREHOLDERS that not many fellow MEMBERS of the CU are going to be affected – and affected NEGATIVELY.
http://business.financialpost.com/2014/07/02/canadian-institutions-scramble-in-race-to-comply-with-fatca/
See particularly details re Credit Unions and quotes from specific ones:
“…Smaller institutions like credit unions, who may lack the necessary resources for compliance, have been particularly vocal in their opposition to FATCA. The Board of Directors of Vancouver City Savings Credit Union, known as Vancity, for example, opposed FATCA’s introduction to Canada, citing the legislation’s “wide-reaching and potential negative effect on personal privacy and freedom, due process, financial well-being and national sovereignty.”
Bill Keen, VP, Finance and CFO of Vancouver-based credit union BlueShore Financial, says his organization faces numerous challenges, among them preserving client relationships.
“We must ensure that we are able to obtain the information that’s needed without offending our clients because we now have to ask for additional information, like a client’s citizenship, that we didn’t require in the past,” Mr. Keen said in an email.
BlueShore has also had to adjust its IT systems to track and monitor FATCA-related information, change its member application process to cover the required information, educate all staff and provide extra-training for front-line staff….”
……”Perhaps the most difficult task is reconciling FATCA with Canadian privacy laws. Like many credit unions, BlueShore has engaged a third party consultant to formulate a strategy for complying with FATCA without breaching privacy laws.”…….
AND WHAT ABOUT THOSE THIRD PARTY Consultants? And are third party consultants privy to our account data and personal information? Are third party consultants processing or handling the data too? Are they US contractors?
I am not sure when this changed but the FATCA page at Vancity now states:
https://www.vancity.com/PrivacyAndSecurity/YourPrivacy/FATCA/
.
Interesting…
Is your privacy affected?
If you are a Vancity member, a non-Canadian resident and a U.S. person living outside of the United States, FATCA may affect you.
Notice it says “and” and not “or” 🙂
@GwEvil
Yes, that matches exactly the Local Client Base exemption in the IGA. They only have to report or close accounts for US persons not resident in Canada.
Presumably, if you live in Canada they won’t ask about your citizenship or US tax status since they don’t need to know. On the other hand, if you have an account an later leave Canada, then they have to know if you were a US person so they can report you or close your account at that time (as written into the IGA). The question is, will they get that information about you now, or not unless and until you leave Canada?
@WhatAmI – leave Canada? Leave how? Like forever or for a trip? I, for one, won’t be leaving for anything but a trip and it won’t be to the US!
@GwEvil
Leave, as in change your permanent residence. I’m just quoting/referring to Page 40 of the Canadian IGA.
@WhatAmI – aha!…well then, I guess I won’t have to worry; its holidays only for me 🙂
Good for Vancity and anyone who is a member of that credit union! And, thanks for reporting, GwEvil.
@Calgary411 – actually it was Just a Canadian who reported. I was just following up 🙂
Thanks JustACanadian.
Together we can try to keep tabs on the position and actions of the CUs, the Bankster FIs, their investment kin, and affected NonFIs.
I am not sure if this is the right place to post this. But it seems to follow along the lines of opening accounts.
See this link to Fidelity Funds. So what is happening here? If you don’t live in the US you will be penalized if you buy foreign mutual funds for retirement. . Now Fidelity is saying if you live outside the US and you are American you can’t buy or trade their US mutual funds either???? 50,000 Americans living outside of the US holding Fidelity funds will be impacted.
http://online.wsj.com/articles/fidelity-bans-overseas-investors-from-buying-mutual-funds-1404246385?mod=WSJ_hp_LEFTWhatsNewsCollection
Fidelity Bans U.S. Investors Overseas From Buying Mutual Funds
Fidelity Investments and other asset managers are telling U.S. clients who live outside the country that they can no longer buy or trade mutual funds in their brokerage accounts.
Stephen Austin, a spokesman for the financial-services firm, said the change, effective Aug. 1, was prompted by “today’s continually evolving global regulatory environment,” but he said it wasn’t in response to a specific issue.
The change will affect about 50,000 accounts, or less than 0.3% of Fidelity’s 20 million accounts, he said.
“Customers will not be forced to sell holdings simply because they live in a foreign country,” Mr. Austin said.
Observers said fund managers are becoming more conservative in the wake of global developments such as the U.S. Foreign Account Tax Compliance Act and other U.S. efforts.
I didn’t catch that. So, of course, to the finder of that statement, Just a Canadian, thanks for more of your valuable contributions.
How easy it would be for our financial institutions to JUST SAY —
Anyone been in their local CIBC branch yet to inquire about FATCA? I still don’t see a Retail Banking specific FATCA page on their website.
It seems right now they are more interested in selling that new Tim Hortons Visa Card then informing their clients about the impacts of FATCA.
Also, has an existing client at one of the Big Five tried to open a new bank account online in the last two days? Are they doing FATCA screening for online account openings?
@All, thats great news for Canadian Brockers on Vancity Credit Union. To be honest, I think based on how the IGA was designed that was part of the intent NOT to net all the legit minnows living their life at home. I think the compliance jackals have scarred a lot of firms into being hyper-compliant.
Ditto what Cerium wrote, I have noticed in the EU the online opening pages for many EU firms literally changed overnight and became very draconian.
Why does ATB have this fact sheet on FATCA http://www.atb.com/SiteCollectionDocuments/Personal/FATCA-FAQs-2014.pdf ?
ATB stands for;
“Alberta Treasury Branches, doing business as ATB Financial,[2] is a financial institution and crown corporation owned by the Province of Alberta. ATB operates in Alberta only, providing financial services to 680,000 Albertans and Alberta-based businesses. ATB has 167 branches and 130 agencies, serving a total of 242 communities in Alberta. Wealth management services are offered under the name ATB Investor Services or ATBIS. ATB has more than 5,300 employees.
Headquartered in Edmonton, Alberta, Canada, with total assets of C$36.4 billion, ATB is the largest Alberta-based financial institution.
ATB is not a chartered bank, and unlike all banks operating in Canada, ATB is regulated entirely by the Government of Alberta, under the authority of the Alberta Treasury Branches Act, Chapter A-37.9, 1997, and Treasury Branches Regulation 187/97. “……… http://en.wikipedia.org/wiki/ATB_Financial
I thought that banks and FIs owned entirely by a government or a branch thereof was exempt from FATCA?
@Badger – wtf??? Why is a crown corporation complying when they don’t even HAVE to?!?!?!
I refer to this:
“…A. Governmental Entity. The government of [FATCA Partner], any political subdivision
of [FATCA Partner] (which, for the avoidance of doubt, includes a state, province,
county, or municipality), or any wholly owned agency or instrumentality of [FATCA
Partner] or any one or more of the foregoing (each, a “[FATCA Partner] Governmental
Entity”). This category is comprised of the integral parts, controlled entities, and political
subdivisions of [FATCA Partner]..”…..
http://www.treasury.gov/resource-center/tax-policy/treaties/Documents/FATCA-Annex-II-to-Model-2-Agreement-11-4-13.pdf
As the Alberta Treasury Branches are wholly owned by the Province of Alberta, a political subdivision of Canada, and serves only a local clientele; “We Serve Only One Community. Alberta.”
http://www.atb.com/about/Pages/default.aspx
So, why would it have a FATCA FAQ page?
That is what I wondered Gwevil. The FAQ page doesn’t display the eager collaborationist air of the one from Meridian, but why a FI wholly owned by the Province of Alberta is not exempt is something I don’t understand.
Perhaps one of our renounced or compliant people should call and ask them.