Posted on Ipolitics.ca You can add your comments at that website. The title of the article is “Revenue Canada quietly handed 155,000 Canadian banking records to IRS”
[Note that the journalist began article with point that our Canadian Government sent private bank info south before receiving privacy assessment from Office of Privacy Commissioner. Journalist failed to find Liberal Government MP willing to chat but did hunt down Liberal Senator who complained about actions of the Tories.]
The journalist, Elizabeth Thompson, comments on her own article: “The language is not misleading. A number of people I interviewed told me of their efforts to get comments from the new Liberal government since the election – from the same Liberal MPs who commented on this issue before the election. I’m trying once again today for an interview with the Revenue Minister (who has a lot less to do with the budget than the finance minister does) and I will keep trying.”]
THE ARTICLE:
“The Canada Revenue Agency quietly turned 155,000 banking records over to the U.S. Internal Revenue Service during last fall’s election, without waiting for an assessment from Canada’s Privacy Commissioner or the outcome of a court challenge to the controversial move.
According to documents tabled in the House of Commons, roughly 150,000 of the Canadian bank records transferred to the IRS on Sept. 30, 2015 related to individuals who are U.S. residents or people with U.S citizenship living in Canada.
The transfer, the first of its kind, was the result of a deal worked out between Canada and the United States in the wake of the U.S. decision to adopt the Foreign Account Tax Compliance Act (FATCA), pressuring financial institutions around the world to reveal information about bank accounts in a bid to crack down on tax evasion by U.S. taxpayers with foreign accounts.
The Conservatives have argued that given the penalties the U.S. was threatening to impose, they had no choice but to negotiate the information sharing deal and through the deal was able to exempt some types of accounts such as RRSPs and Tax Free Savings Accounts from the information transfer.
A second transfer of records to the IRS is scheduled for September 30, 2016.
As part of the deal, the IRS also agrees to send the CRA information on Canadians with U.S. accounts.
While the government says financial institutions should be open with clients about their files being sent to the IRS, the CRA is not automatically informing those whose records have been transferred, saying it is up to individuals to ask for the information.
The CRA says it submitted a privacy impact assessment to Privacy Commissioner Daniel Therrien’s office for review on Aug. 27, 2015 but only received recommendations from Therrien on Jan. 4, 2016 – well after the records had already been transferred.
Critics, including Prime Minister Justin Trudeau before he came to power, have raised concerns about the information sharing deal, saying the implications of the CRA reporting to a foreign government agency about Canadian citizens was “troublesome.”
“The Liberal Party of Canada believes that the Conservative government’s efforts to safeguard the personal privacy of Canadians have been inadequate,” Trudeau wrote in a letter dated June 25, 2015 to Lynne Swanson of the Alliance for the Defence of Canadian Sovereignty, which has been fighting to stop the CRA from turning the records over to the IRS.
“While the United States has the right to target tax evaders using offshore accounts, targeting hard working Canadians who pay taxes is unfair,” Trudeau added. “The Government of Canada has a responsibility to stand up for its citizens when foreign governments are encroaching on their rights. We believe that the deal reached between Canada and the U.S. is insufficient to protect affected Canadians.”
During the election campaign, Liberal Darrell Samson, who was elected MP for the Nova Scotia riding of Sackville-Preston-Chezzetcook, pointed out that Liberals had criticized the information sharing in the House of Commons and questioned whether the move was even constitutional.
“We also have concerns that the agreement reached with the U.S. may not stand up to a Constitutional challenge given that it forces the banks to treat clients differently based on their national origin, something forbidden by Section 15 of the Charter of Rights and Freedoms,” he wrote on his website.
Since taking office, however, Trudeau’s Liberal government appears to have been silent on the deal.
A spokeswoman for Revenue Minister Diane Lebouthillier said the minister was not available for an interview Tuesday.
Swanson, who has been a Canadian citizen since 1973, says she feels betrayed – first by the Conservatives and now by the Liberals.
“I’m furious. I feel totally betrayed,” she said, rattling off a list of prominent Liberals who spoke out against the deal before they formed the government.
Swanson questions whether Canadians would accept a similar deal to share private information with any country other than the U.S, saying it treats some Canadian citizens differently from others.
“FATCA requires Canadian banks and other financial institutions to report to the IRS private banking information, private financial information. In terms of bank accounts that includes account numbers, account balances, total assets, transactions, address and other personal identifying information.”
“If all Canadians were having that information submitted to the Canada Revenue Agency to pass on to a foreign government, there would be absolute outrage in this country.”
Swanson said her group’s constitutional challenge of the information sharing deal is currently before the courts. NDP Revenue Critic Pierre-Luc Dusseault, who placed the question on the order paper, is concerned that the CRA is not advising people whose records were shared with the IRS.
“What is worrying me is that CRA is not notifying people automatically whose information was transferred,” Dusseault explained. “So the CRA has some information on Canadian citizens who are happen to also have American citizenship and these people had their information transferred on September 30 without a lot of noise.”
Dusseault says the CRA should notify all of those whose records were transferred.
“Some people may not know that they are part of that transfer.”
Dusseault says he is also concerned by the CRA’s decision not to wait for the privacy commissioner’s ruling and to transfer the records during the election campaign – a time when under the caretaker convention public servants are supposed to abstain from anything but routine actions.
Dusseault said he plans to propose a parliamentary committee hold hearings into the CRA’s actions.
Senator Percy Downe, who sits as a Senate Liberal, says the CRA should have waited until after the election before transferring the records to the IRS.
“It’s quite surprising that they did not ask for an extension,” he said. “The extensions the IRS gave others they claimed did not apply to the CRA but I’m sure the IRS would have understood if the CRA had said, ‘We’re in the middle of an election, the election’s over in October, we’ll have a new minister in November.’ What’s a couple of months delay?”
Downe said he was also surprised the CRA transferred the records before getting an assessment from the privacy commissioner’s office, which he said made recommendations about limiting the collection of information, limiting the disclosure of information and the retention of personal information.
“This is after the horse had left the barn, if you will, because the information was already turned over in the rush to get it to them.”
elizabeththompson@ipolitics.ca
@US-FOREIGN-PERSON
And that’s what I’m concerned about. There are many reasons why a person may have US indicia, but not be a US person. Without digging deeper, we really can’t be absolutely sure that our information was not sent.
There will be lots of false-positives and false-negatives when it comes to identifying USP’s based on “indicia”.
“Bank workers are sometimes not the smartest group of people…”
You don’t say….
Hey listen, I am not telling Marie there is zero chance her family member’s info got passed in the 2015 transfer to CRA, just that it is doubtful if all they have to go on is a regular SS deposit. I mean it is more than overkill to be assuming that someone with regular SS deposits is a US person. No matter how stupid a bank employee is, and if they think someone might be a US person, the would at least pose the question (assuming said family member is not on file as a US person) before sending off account information just based on a regular SS deposit. This does not make sense, no matter how dumb the bank employee.
Where is Duke of Devon? Marie re: ” There are many reasons why a person may have US indicia, but not be a US person. Without digging deeper, we really can’t be absolutely sure that our information was not sent. ”
You just answered the concern of your second statement with your first statement. Banks are not gleefully looking for US persons. Do not tell that you are one, and it is very unlikely (unless some horrible mistake was made which can happen to anyone) that your info was not sent. YET.
You should be more concerned about the 2016 transfer because this is the year banks are supposed to review existing account holders and this is when US indicia will be looked at, and questions asked. If you have not yet been questioned by the bank (no letters sent, no snoopy bank employee querries) then it would be highly unlikely that your info was sent already simply because you have a regular SS deposit.
ooops… should have been ‘sent’, not ‘not sent’.
@Marie
I don’t know where you live but I’m in BC. The credit unions are all “FATCA compliant” but some have registered for exemptions from FATCA. In BC there are a number of exempt credit unions who do not report due to local client base or low total assets, as long as one is a Canadian resident. For example in BC, Vancity is registered as a Local Client Base FI. Please see the following which I believe has been posted on Brock previously:
http://www.bdo.ca/en/Library/Services/Tax/pages/Tax-Alert-FATCA-and-Canadian-Credit-Unions.aspx
@Marie
Just wanted to add there should be exempt credit unions in other provinces but I have only researched in BC. You would need to question them carefully to determine their FATCA status. Talk to management if necessary.
I’ll post this here as well as blog article. Liberals excuse for transferring info on CBC.
http://www.cbc.ca/news/politics/liberals-told-no-action-needed-on-controversial-u-s-tax-deal-1.3494007
The CRA is allowing court proceedings in s foreign country influence the Canadian government?
It is *so* fantastic to hear this is going to be on The Exchange this afternoon! It’s about time! As a community we have been typing our fingers bloody over this issue for close to five years and a couple of know-nothing commenters at ipolitics have the gall to suggest that we’ve just gotten started and can’t expect to get our answers just like that! That commenter should be better informed before shooting his mouth off. I can’t wait to hear John Richardson speak this afternoon!
Comments on the CBC article would be useful.
@Cheryl regarding:
http://www.cbc.ca/news/politics/liberals-told-no-action-needed-on-controversial-u-s-tax-deal-1.3494007
America the Tyrant…a sad day. First the Conservatives here in Canada would not stand up to the big bully and now the Liberals go down the same path.
I hasten to add my thanks to Lynne and to Elizabeth Thompson! This article has gained our issue some badly needed attention!
Yes, big thank you to Lynne and Elizabeth Thompson.
I have sent an e-mail to the CBC reporter who wrote that article urging him to dig deeper and ask some very pointed questions of the Liberals.
I sent him many of the comments made by the Fibbing Libs in Opposition.
I also gave those comments to Elizabeth Thompson and encouraged her to especially look at the ones by Emmanuel DuBourg in the House of Commons and in the this article. Mr. DuBourg worked for CRA for 20 years and called FATCA an “atttack on our privacy…dangerous” in this article:
http://news.nationalpost.com/full-comment/emmanuel-dubourg-an-attack-on-our-privacy
I continue to believe–others may of course take a different view–that having made the strategic decision to sue rather than wait for the 2015 Canadian election, our energies are best spent in the courtroom arena (and publicizing/attracting witnesses for the trial), not the political arena.
The Liberal government is in hiding, but we ourselves have given them something to hide behind: the fact that there is pending litigation before the courts and they can just excuse themselves from commenting on that basis. It is disappointing but not surprising that they haven’t made any gestures to follow up on their campaign promises.
Good article though for helping to publicize this. It is good to see increasing coverage of these issues in new forums (ie the master’s thesis posted yesterday, this article, etc.)
Thank you, Lynne.
Wake up Canadians!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
There is still this comment (though obviously the previous comment this is continuing from is no longer there):
This was signed off in 2014, which means the Harper government was responsible. Moreover, the first batch of information was turned over to the IRS last September — before the Liberals were even elected.
That’s not to say that we shouldn’t be speaking up and protesting, but the fact is that the barn door was opened last year and the horse has long since headed for the hills.
George Orwell was right about everything, except the timing.
@WestCoaster
I agree and expect that others will continue to protest the Liberal stonewalling when Brockers and others ask them important questions. However if they respond with “we cannot comment because there is pending litigation before the courts” there will not be much we can do except continue to fight that court battle aggressively.
Bringing increased publicity to FATCA and CBT in the court of public opinion, however, is very important right now and I’m glad to see some efforts recently in this regard.
@Dash re: ” Bringing increased publicity to FATCA and CBT in the court of public opinion, however, is very important right now and I’m glad to see some efforts recently in this regard.”
Me too. We cannot let ourselves continue to be perceived as those ‘Americans living in Canada who want their cake and eat it too.’
Oh Oh. Brace yourselves. Canada “bound” to uphold Tories’ deal.
http://www.theglobeandmail.com/news/politics/saudi-arms-contract-must-be-honoured-trudeau/article29259042/
This relates to the sale of arms to Saudi Arabia. However, I can just hear JT using these same words to explain away FATCA:
So that my friends will likely be the justification for why “A Canadian is a Canadian is a Canadian” does not include us.
.
Same old bs… different name… I wanted to heave Stevie out more then anything… I did not expect JT would make any changes… a canadian is a canadian is a canadian = U vote for me cause I am full of crap… that is how I looked at him… He is that smiling salesman who sells u that old crappy car & tells u its the best one on the lot… The only difference between this gov’t & the previous one… nothing except this one won’t talk to the citizens of their country they are suppose to protect & they do everything under the table… only time u hear anything is when they come out to pat themselves on the back for a great job they did for Canada when the deal is done…
@Blaze
“A Canadian is a Canadian is a Canadian” just means dual Canadian/whatever citizens aren’t going to lose Canadian citizenship and get deported back to the country of their other citizenship, even if they do something criminal. The next government might not make any such promises.
The US is the top global power at the moment, which is why 100+ countries are sharing their citizens’ tax information with the US — that includes the UK, Australia, NZ, and the Netherlands, to name just a few.
Like I said earlier, I think we can and should protest. That said, if anyone has reason to believe their bank suspects they’re American, their data is quite likely already in US hands and they need to think about damage control (i.e., proactively start filing taxes and FBARs before the US taps them on the shoulder).
Is this fair? Is this right? HELL, NO. But this is 2016 — what little privacy we have at this point is only going to erode further.
Comments are starting to come out of moderation at the CBC article. The first part of FromPatriotToExpatriate now appears:
But, alas, the CBC article no longer (that I can see) appears on the main CBC News page. It can still be accessed under their heading *Politics*.
By the way, I realize that some people might take a different approach to damage control. For various reasons, it might not be possible for someone to jump through all the USG hoops; that said, it would still be a good idea to do some contingency planning in case their data has been shared.
In any case, forewarned is forearmed!