There has been a request to bring the subject of Security to the forefront. Another look at prior commentary on the subject follows.
Does FATCA pose an unacceptable security risk to Americans abroad?
There has been a request to bring the subject of Security to the forefront. Another look at prior commentary on the subject follows.
Does FATCA pose an unacceptable security risk to Americans abroad?
The security issues are real and multi-dimensional. One aspect, not obvious or ever discussed is that some countries do not permit dual citizenship (e.g. Malaysia, Singapore and many others). The ‘US Person’ who is a dual in such countries risks being ‘outed’ by his/her FFI to the local nation’s authorities as a direct result of FATCA enforcement. This unfortunate dual US citizen would then have to deal with not only FATCA issues with the IRS but also local nationality issues with the country of his residence.
Just look at stories like this one, http://www.cbc.ca/news/world/password-hack-affects-1-2-billion-accounts-more-at-risk-1.2728865 and ask yourself why those living ordinary lawabiding lives outside the US should be put at additional peril merely because of inherited citizenship via a parent, or a long ago birthplace, etc.?
Wouldn’t FATCA data be a juicy plum that determined hackers would already be anticipating plucking? And there is already the FBAR – now mandatory to be filed online.
The US Treasury and the IRS are making US status a growing danger to the financial and personal security of those living outside the US. The true criminal masterminds who are ostensibly the targets of FATCA and FBAR would be unlikely to put their assets at risk, and unlikely to be filing FBARs. Thus those most vulnerable will be those ordinary people with legal local savings – not the drug lords, terror funders, money launderers etc. that the US pretends they’ll be catching.
Do democracies usually put masses of ordinary people at such high risk routinely and automatically, just in case they MIGHT catch a criminal unawares? Is that the kind of country the US is?
Like fishing by throwing dynamite into the pond.
Security is one issue. How about extortion?
Angry business partner?
Angry wife?
Corrupt government officials?
Also FATCA put Americans abroad at an unfair advantage with law enforcement agencies. If you’re British, other countries won’t have this 12 month old database at the ready by using MLAT agreements.
Rather than use old fashion policing, just coerce the local FFI to give you the data.
I feel thrown under the FATCA bus every time I think about it.
Australia’s Privacy Principles were amended at around the time of the IGA to include exception in case of international treaty.
And those of us who are fully compliant with US filing receive no protection whatsoever because not only do we send our financial information electronically to the IRS (at least we know it is accurate to the last penny), but there are two more chances that our information (correct or incorrect) could end up in the wrong hands when it is transmitted from the banks to CRA and onwards to the IRS.
One of our FFIs has already made the assumption that my Canadian only husband is a US citizen or has a green card because he is married to me. They planned to forward his “accounts owned separately” information in addition to our joint account information. When my husband wrote to say that he has never worked or lived in the USA and that the bank did not have his permission to send his private information to a foreign government, they responded that they would only send his information if it was required by CRA! So as we all know a lot of people who are not US citizens will be caught up in this net and exposed to hacking and identity fraud, as well as possible criminal investigation letters from the IRS.
Allison Christians mentions the problem of data security and the FBAR; “……… a growing problem of FBAR fraud, in which criminals attempt to get personal & financial information from people by sending them serious looking notices……… I’m sorry I didn’t see this before I published my column, as I would have mentioned it as a significant issue. Capitalizing on the ignorance and fear of regular (non-rich) US persons outside the United States will be all too easy for criminals, I am afraid. I hope that the IRS and FinCEN can figure out a way to warn people–but I don’t see how they can really do that on a global scale, especially since FATCA’s job is to funnel information about millions of people to the IRS, and not the other way around. At minimum, every government that signs an agreement to implement FATCA should be sending out the warnings, since each is undertaking a huge responsibility in implementing US citizenship taxation on their own residents.
”
http://taxpol.blogspot.ca/2014/08/christians-on-regulating-tax-preparers.html
Isn’t laying US citizens open to fraud and data theft a human rights violation? The US forces people who have broken no laws to make themselves vulnerable to significant harm, and it achieves that via threat of force – which is extortion. The US does nothing to assist those who it makes vulnerable, and can’t be bothered to warn them.
http://tax-expatriation.com/2014/08/06/samples-of-international-tax-frauds-that-are-flourishing-now-with-more-taxpayer-financial-information-required-under-the-law/
Allison Christians refers in part by this blog post:
‘ Samples of International Tax Frauds that are Flourishing Now with More Taxpayer Financial Information Required Under the Law’
August 6, 2014
I do not know what a Canadian Passport would list for place of birth. I also know you can get a passport issued showing no place of birth.
I have lost the link but The Daily Mail (UK) had an article about threats to Americans.
I would think that many people would be able to petition their passport issuance office and request that USA or anything that makes the place of birth an unambiguous place of birth in the USA to be removed.
Provide a solid letter and references on why it place3s you in danger to have a Canadian Passport that might list USA or Montana in place of birth.
Again….solely as a reason to aid in personal security.
The link you’re looking for, George, I believe is: http://isaacbrocksociety.ca/2012/12/07/fatca-facilitating-attacks-by-terrorists-on-citizens-abroad/comment-page-2/#comment-2526155, which has a link to my post of yesterday: http://isaacbrocksociety.ca/2012/12/07/fatca-facilitating-attacks-by-terrorists-on-citizens-abroad/comment-page-3/#comment-2528394
(See the final link there on threats to security of financial information and person of *US Persons*), in the body of this post where you’re at.)
This would be hysterically funny if Schumer wasn’t a two-bit money-grubbing ass.
http://www.businessinsider.com/senator-warns-fitbit-is-a-privacy-nightmare-2014-8
On the flipside he champions FATCA which would blow the privacy door wide open for American expats who would end up losing their privacy with regards to financial information, but he’s going on like an idiot about a “fitness program”???
Has the rest of the world gone stupid and we just didn’t notice it until now?
http://globalguerrillas.typepad.com/globalguerrillas/2014/08/the-irs-bot-scam-from-pakistan.html
Good thing Jack Lew is negotiating an IGA with Pakistan! That way the banks will help these scammers compile a local list of Americans who they can target for more sophisticated scams, e.g. pretending to be the bank itself and asking you to reconfirm your date of birth, US Social Security number, and all other personal & banking details.
Easily they can get enough information to apply for credit cards, loans, or even a US passport in your name back in the US …
There was a fairly alarming story about the murder of an American kindergarten teacher and attempted bombing of an American doctor a few days ago in the United Arab Emirates. It appears that the assailant deliberately targeted the woman solely because she was American. I hope that they have some pretty heavy security on that FATCA U.S. persons list for Kuwait, since the murderer is not believed to have been a lone wolf.
http://www.dailymail.co.uk/news/article-2861660/Woman-arrested-murder-American-mother-inside-Abu-Dhabi-mall-not-lone-wolf-house-base-operations-terror-plan.html
http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments/comment-page-115/#comment-5372942
Will the FATCA data be as insecure as that at the Obamacare portal?
http://bigstory.ap.org/article/31490a20926d4ed3b98ff2d0ed8fc81d/new-privacy-concerns-over-governments-health-care-website