I believe that the two Withers LLP employees are absolutely honest, from their perspective, when they made their statement that “FATCA… is just another form”.
Here is their Thanksgiving Message to all of us, a reply from @EmBee, and my short email to one of the employees:
“UK: Who’s Afraid Of FATCA?
Article by Jaime McLemore and Richard Cassell
Withers LLPWe are now firmly in the FATCA era and moving on to the post FATCA era. With the first FATCA reports being submitted in March 2015, by now many FFIs have registered and obtained their GIINs, trustees are documenting their trusts, holding companies have entered into appropriate sponsorship agreements, and the financial world is a flurry of W-8BEN-Es and tax status questionnaires. Many have come to the realisation that, although an annoyance, FATCA compliance is manageable. As many of us predicted, for compliant Americans, it is really just another form.
However this has not stopped financial institutions from using FATCA as an excuse either to exclude US clients or impose special requirements (for instance, minimum account balances) on US clients wishing to open or maintain bank accounts. Some financial institutions are offering to help clients with FATCA compliance for a fee, which is a handy way to generate revenue from a government requirement.
Americans residing outside of the US have long bemoaned the pariah status that FATCA seemingly imposed on them from the beginning. As labourers in the FATCA vineyards we are now coming to the conclusion that FATCA is being blamed for all the ills of the financial system, in some cases unfairly. It seems, despite the efforts of the US and local jurisdictions to ease the reporting implications of FATCA, primarily through the Intergovernmental Agreements, Americans still face difficulty when dealing with banks and other financial institutions. Perhaps these banks with some exposure are still smarting from their dealings with the US Department of Justice, either under a criminal investigation or a non-prosecution agreement.
Banks will need to develop a reasonable approach to FATCA reporting since, relatively soon, the OECD’s Common Reporting Standard (CRS) will also come into effect. The CRS is the first genuinely multinational automatic tax information exchange and will see OECD countries (including just about all European countries) voluntarily exchanging information about each others’ residents. It is intended to be consistent with FATCA reporting – so US citizens will not be alone.
When the US introduced FATCA many European countries objected to the long arm of US tax jurisprudence and claimed that data protection rules prevented compliance. Gradually the EU and OECD countries came round to thinking that, if adopted it could provide a good basis for implementing the long standing OECD information exchange initiative, and so most of the OECD countries have entered into intergovernmental agreements with the US to implement FATCA consistent with data protection laws. These agreements have formed the basis for implementation of CRS. And they can blame the Americans when anyone complains.
But the problems that US citizens can face in opening and maintaining investment accounts outside the US are not really related to FATCA in our view. Instead the blame should be laid at the door of a different part of the alphabet soup of cross border regulations.
The AIFMD (Alternative Fund Managers Directive) has combined with the SEC and Dodd Frank US regulations mean that managers offering fund investments on a retail basis now face a much higher degree of regulation. So Americans can still open bank accounts but finding an investment manager is more challenging. Partly this also reflects the competing US and UK tax issues for fund investors.
So Americans abroad can still have cash deposits, buy equities and bonds and trade currencies. But if they want to buy funds they will need to seek out the small, but growing, number of managers who are geared up for the new fund regulatory environment.
So this Thanksgiving Americans should pardon the FATCA turkey and hunt for sophisticated fund managers for their investments.
[“At Withers, we believe that the strength of our business must be aligned to our social values.”]
Here is @EmBee’s Thanksgiving message reply to the Withers LLP employees:
“Pardon me?
I say chain McLemore and Cassell to the FATCA turkey’s drumsticks, stuff that bird with some Guy Fawke’s gun powder and light a match.
Three turkeys in one big blow out.”
My email response to one of the employees:
“November 24, 2014
Dear Ms McLemore,
I couldn’t help but notice your FATCA Thanksgiving message to Americans abroad (I am one such person).
Because your message was, I believe, made honestly and represents an important point of view of Withers LLP and other similar firms I have re-posted the Thanksgiving message with a brief reply from my colleague (Mrs. Em Bee) on the Isaac Brock website.
There are many inaccuracies in your message, but for the moment I will take issue with one statement that you made, that FATCA is “just another form.” For example, our group, the Alliance for the Defence of Canadian Sovereignty, is taking the Government of Canada to court over its “agreement” with the United States to implement FATCA, under threat of economic sanction.
As you are an attorney, why don’t you have a quick read of some of our Claims and let me know what you think?
Also, I see that you are a graduate, like me, of Notre Dame University. By any chance were you a student of Michael Kirsch, well known for his views on U.S. imposed citizenship-based taxation?
Please let’s keep the dialogue going. I will post your response on the Brock site.
With best wishes,
Stephen Kish
Notre Dame Class of 1970″
Oh my! Now I’m going to be labelled as a terrorist too. 🙁 I may have to learn to keep my fingers off the keyboard after midnight. Oh well, we’ve all been given many labels, good and bad, so what’s one more? Needless to say I’ll be interested in Ms. McLemore’s reply, if she has one.
Something we may miss often and which Stephen points out- most of these accountants/lawyers are “absolutely honest, from their perspective.” I heard this same thing from someone who recently attended a “condor” seminar. Instead of assuming willful misuse of the situation for greed, gain and whatever, the impression was one of a group of people who simply are nowhere near the part of the page we’re on. Of course there will be a few who do abuse, overcharge, misrepresent, or omit info that should be transmitted. But by and large, these are folks who make their living by providing services that match the law- which would seem to be totally normal to them. Their experience is what they know from working in the system. They are not designed nor equipped to work outside of it. And not inclined to do so either.
Not condoning it. But sometimes to get folks to do what you want, you have to consider it from their point of view and adapt a bit. Ditto for journalists. Our fear and anxiety comes across as hysteria to them, they probably feel entitled to their fees and view the political/govt side of it as a waste of time………….
Excellent action, Stephen. Thanks for the read and your response to the “UK: Who’s Afraid Of FATCA?
article by Jaime McLemore and Richard Cassell of Withers LLP, including your invitation to keep the dialogue going.
New to me, but maybe not to others:
They are being blatantly disingenuous and obfuscating when they attempt to seek some moral high ground by condemning foreign FI’s for muscling in on their territory!
(Don’t worry EmBee, you’re in good company).
Tricia and Stephen
You are absolutely right when you say that “Wonderful World of Forms, Threats and Penalties” is completely normal from the perspective of the Compliance Condor. In fact, for most of them, the completion of forms is the fundamental obligation of citizenship (or at least U.S. citizenship). Furthermore, very few of them see the system of taxes, forms as penalties as being immoral. They just see it as normal.
One could say that the Compliance Condors work “within the system”. But, the truth is that the Compliance Condors “Are The System”. They make it work. They shape the law. They shape the expectation of the law. Once one Condor begins filing a specific form (example 3520 for the TFSA) the other Condors are sure to follow. Because Condors are “Inside The Form” looking only at the Form, they can’t imagine what it means to be “Outside The Form” looking in. They can’t see the immorality, the injustice, the waste of human resource and the dehumanizing of the individual. In fact the Compliance Condors “aid and abet” each of these things – they take pride in doing it. But, there’s much more.
In the “Form Industry” there is a hierarchy of forms. Those who are most experienced assist with the most complex forms. Imagine the day in the life of a Compliance Condor when he/she reaches the point where he is assigned a 5471 or an 8621. After all, those who are most junior would start with an FBAR or perhaps a schedule B. The value of a Compliance Condor is a function of the forms to which he is entrusted. His sense of “self worth” is defined by the form that he is assigned.
A Compliance Condor would start the day by looking the mirror and saying:
“In forms we trust”.
The most dedicated Condors dream of Forms. But, they do more than dream about Forms. Because their identity is a function of their forms, many of them go further than dreaming about forms. Those who are most dedicated actually dream about being specific line numbers on different forms . In social settings they confide about their dreams to other Condors. In the industry, these are known as “Form Dreams” .
So, yes when the Compliance Condors write about FATCA, FBAR and other sacred instruments of confiscation, they are being sincere. They believe are being helpful. They are NOT being dishonest And above all else, they are simply writing about the world they way they see it and the way they experience it.
And that Dr. Reader is exactly the problem!
P.S. Avoid “Form Crime” – The Compliance Condors will love you!
@USCitizenAbroad,
Aha, so a sort of misty-cloudy grey for the lowly 1040, perhaps a bit of astral pink for sch b.. I should think not only a hierarchy of forms/dreams, but imagine…an 8621 must be 3D tecnicolor! Would there be Dobly Atmos as the juicy totals are written in?
Being a compliance condor is like being a homelander then – they lack perspective.
What a complete load of BS! – a tip of my hat to you Stephen for taking a deep breath, keeping calm and writing an excellent response given the completely biased and inaccurate statements in the ‘message’
I heard a story about a compliance condor whose wife left him because she caught him having an affair with forms.
Even if McLemore and Cassell lack a sense of humour, it’s obvious Brockers do not. And that’s pretty amazing considering how the past few years have “formed” up for us.
I prefer Compliance Jackals.
@diharv
Lol. Some call it “formication”.
I’m probably being targeted for my Twitter comment of “Sure, send a drone over and we’ll make sure we shoot it down“. I’m sure Homeland Security is having a field day with it.
Up until we got the current crop of brainless idiots for government officials, when I traveled abroad, I encountered several American citizens who were proud of the fact they were citizens living abroad and in fact some of them were citizens by the accident of their birth to American parents. They loved being labeled Americans and even said they would probably live here some day…..It is a different story today. Many are trying to shed citizenship any way they can, by any means they can. Some have taken assumed names of non American citizens of their home country…….I am so saddened that we have gone into decline, when we were the one country everyone wanted to live in. I am a 10th generation American and have always been proud of it—not so much now—but where else would I go?
Withers LLP spoke at that talk that I went to. I can’t fault their professionalism, but they are wealth managers. I wonder if they have ever actually advised a typically middle class American abroad. The rest of the people at the talk were HNWis and the examples contained assumptions that the audience was wealthy. I suppose that if you call a talk Estate Management, the average Joe and Josephine don’t go because they don’t think that U.S. tax will hit them (hah!). If you look at Withers’ website, the examples include how they helped some aristocrat preserve the family art collection for future generations. I might test out my suspicion.
Here’s a behind the scenes look inside a Condor office: http://youtu.be/7xNnRBksvOU
@GwEvil
Not authentic. Not enough forms.
Related to GwEvil’s tangent, see:
https://www.youtube.com/watch?v=UNOvmQuyT8M
Video was posted 2009, comments below it are current.
@Shovel, lol! My bad!
For those compliance condors, take that turkey and stuff it with a few of their favourite forms for Thanksgiving.
I heard recently that psychologists in France had done a study of people who had been on a French TV programme in which participants gave electric shocks to other people. Through a questionnaire, they found that those who were most likely to give the maximum shock were the most conscientious. I would imagine that compliance condors are quite conscientious people.
We used to observe two Thanksgivings — not this year though — or ever again. We are both Canadians now so it’s Canadian Thanksgiving only for us from here on. Our next “turkey” (actually a chicken) will be on our plates at Christmas. BTW I just learned that Canada does not have a national bird. Could this be that our turkey of a PM thinks we are just fine without one since the U.S. Bald Eagle flipped us a bird with FATCA and cooked our Canada goose to boot?
That’s an insult to all turkey’s, EmBee, as Harper lacks all the grace and good taste a turkey has – although he’s just as likely to put you to sleep 🙂
@ Bubblebustin
Point taken. Although he does look stuffed and, as you say, when he speaks he definitely has that L-Tryptophan effect. He also seems to have a covert set of talons — the better to rip open our bank accounts and pass our savings across the border whenever the Bald Eagle screeches.
Any connection between compliance condors and turkey vultures at Withers LLP?