Reposted with permission of the author
Originally posted on Tax Connections Blog

Fighting FATCA “Tyranny” in U.S. Court
 
Born and raised in Communist China, naturalized American citizen Solomon Yue says he understands why people leave a country because of tyranny.

That’s exactly why Yue “can’t watch people abandoning (U.S.) citizenship because of FATCA tyranny.”

So, the Vice Chairman and CEO of Republicans Overseas Action spearheaded a constitutional challenge to Foreign Account Tax Compliance Act (FATCA), Intergovernmental Agreements (IGAs) and Foreign Bank Account Reports (FBARs).

Although Yue lives in Oregon, he was alarmed and troubled by soaring number of Americans living outside the United States relinquishing or renouncing American citizenship to maintain banking and financial accounts where they live, work and are often citizens.

Yue says FATCA, IGAs and FBARs strip 8.7 million Americans around the globe of their constitutional rights. “Stop making overseas Americans second class citizens by taking away their constitutional rights,” asserts Yue.

“This lawsuit’s aim is to restore those overseas Americans’ and “Green Card” holders’ full citizenship through legal action on constitutional grounds all the way to the U.S. Supreme Court,” Yue says.

“Financial Surveillance of Unprecedented Scope”

On July 14, Republican Overseas Action filed a lawsuit in U.S. District Court on behalf of seven plaintiffs from Albania, Canada, Czech Republic, Israel, Switzerland, and United States claiming eight counts of constitutional violations, including violations of Fourth, Fifth and Eighth Amendments.

The lawsuit says “FATCA was intended to address tax evasion by U.S. taxpayers who fail to report foreign assets located outside of the United States. But in practice it is a sweeping financial surveillance program of unprecedented scope that allows the Internal Revenue Service (“IRS”) to peer into the financial affairs of any U.S. citizen with a foreign bank account. At its core, FATCA is a bulk data collection program requiring foreign financial institutions to report to the IRS detailed information about the accounts of U.S. citizens living abroad, including their account balances and account transactions.”

The lawsuit also highlights some of the real challenges of FATCA for Americans living abroad. “On the most fundamental level, FATCA deprives individuals of the right to the privacy of their financial affairs. FATCA authorizes the IRS to collect information on the financial assets of U.S. citizens living abroad that it cannot collect on U.S. citizens domestically. On a practical level, FATCA is severely impinging on the ability of U.S. citizens to live and work abroad. It is affecting all facets of individuals’ lives from day-to-day finances and employment to family relations and citizenship.”

Fighting Back

“I once got trapped in an enemy minefield with no good choices — getting hit with FATCA felt a bit like that,” U.S. military veteran Major Roger Johnson told the Washington Times. So, after fighting for the U.S., Johnson is now battling the American government for his own liberties and rights.

Johnson, who has lived in the Czech Republic with his Czech wife for 21 years, is one of seven American and former Americans who have not met each other who have united as plaintiffs in the lawsuit to fight back against the intrusion of the United States government into honest, law-abiding lives outside U.S. borders.

Other plaintiffs are a lawyer in Israel, a professor of psychiatry and pharmacology in Canada, an owner of a securities brokerage firm in Albania, an information technology worker and U.S. military veteran in Switzerland, an author in Switzerland and U.S. Senator Rand Paul. All except Senator Paul have experienced serious issues relating to normal banking and financial services in the countries where they live, work, earn incomes and pay taxes. They have lived for years or decades in their respective countries and most are citizens of those countries. The two Swiss plaintiffs took the extreme step of renouncing U.S. citizenship to be able to maintain normal banking and financial lives.

“This lawsuit will not only enable Republicans Overseas to defend all overseas Americans and stateside Green Card Holders right to privacy and other constitutional protections, but also provide them immediate injunctive relief by crippling the Treasury’s ability to enforce IGAs and IRS/FCEN FATCA enforcement capability,” says James Bopp, Jr., the lawsuit’s lead lawyer.

Americans around the world are watching.