On December 7th, Eric put up a post entitled FATCA: Facilitating Attacks by Terrorists on Citizens Abroad In that post, he referenced an excellent article out of Lebanon highlighting what I call FATCAs FATAL FLAW – Security (note new link)
If you have not read it, it is MUST READ material for all that are concerned about this seriously overlooked aspect of one of the many unintended consequences of FATCA.
However, we don’t have to wait for FATCA to see how some are already taking advantage of the fear that is being perpetrated across the American abroad community surrounding the IRS offshore jihad. Already the phishing expeditions have begun. You should be aware of them. Roger Conklin sent me this example that he just received via an unsolicited email from the IRS. First tip off that this is phony is that the IRS NEVER uses email for communication with Taxpayers.
Below is an example of the email he received: I have left most typos in place for illustrative purposes.
 |
|
Report of Foreign Bank and Financial Accounts (FBAR)
|
|
|
|
|
| This is in reference to your 2010 U.S. Individual Income Tax Return we seem to have some discrepancies with your filing. The Financial Crimes Enforcement Network (FinCEN) investigation has indicated that there might be some Undeclared Foreign income under your name . Please go through the guideline on FBAR below. |
| Â |
|
Guideline on FBAR
|
| Â |
We have attached an updated account verification 1040 form that you will be required to filll and fax back to us within 48 hours. This form requires you to disclose all your domestic and international financial accounts. Note that under IRC § 7201: Acts to Evade or Defeat Collection of Tax “It is a crime to evade or defeat any tax†(it is a felony to willfully attempt in any manner to evade or defeat the collection of a federal tax). A violation of Section 7201 is a felony and conviction under this provision invokes a maximum fine of $100,000 for individuals and $500,000 for a corporation, or a maximum imprisonment of five years, or both, and the payment of prosecution costs.Fax completed form to 866-345-6875
United States Department of the Treasury
P.O. Box 32621
Detroit, MI 48232-0621. Victor S.O. Song,Â
Chief,
Internal Revenue Service,Â
Criminal Investigation (IRS-CI) |
| This information is intended only for the person or entity to which it isaddressed and may contain private, confidential, proprietary and/orprivileged material and may be subject to one or more confidentialityagreements. Any review, retransmission, dissemination or any other useof or taking of any action in reliance upon this information, bypersons or entities other than the intended recipient is prohibited. Ifyou received this communication in error, please contact the sender anddelete the material from all storage media. |
|
Yikes! Thanks for reminding IRS would never connect via email.
No surprise here, I was expecting something like this would happen.
We all know who is to blame here.
@CHF Forever
Where are these folks getting email addresses of USP’s?
*
I reported this phishing attempt to the IRS and received a prompt automated reply. It provides information on how to report phishing attempts. Forward any you receive to phishing@irs.gov. I do hope that if anybody else receives one of these they will report it to the IRS. FBAR, FATCA and citizenship based US taxation just fills US citizens living outside of the US with fear, and this agony needs to be “shared” with the IRS.
@Roger Conklin:
I believe you asked in another thread whether anyone knew of a country that tracked or took a census of its citizens abroad. Switzerland tracks its citizens abroad and reports on them annually, as I understand it. Attached is a link to the 2012 statistics, just released (in German):
http://www.eda.admin.ch/etc/medialib/downloads/edazen/recent/media.Par.0108.File.tmp/Auslandschweizerstatistik.pdf
This link is to a story in today’s TagesAnzeiger newspaper with a map showing where some of the “Foreign Swiss” (Auslandschweizer) live:
http://www.tagesanzeiger.ch/leben/gesellschaft/Wohin-die-Schweizer-auswandern/story/13455215
Aside: Approx. 11.3% of Swiss citizens live abroad. ( (716’000/ (8’000’000 x (100%-21%))), i.e., 21% of residents of Switzerland are non-Swiss ).
*@Innocente, Thank you for this information. I note that these statisics are very precise. The reports in some cachanges, for example of the Swiss citizens in some countries as having changed from one year to the next by only 1 or 2 persons. How does the Swiss Government collect and maintain such presise statistics? With an estimated 7 million US citizens living outside of the US that is about 2%. A far lower percentage probably than any oher developed country.
@Roger , As far as I know a Swiss citizen is obligated to register with the Swiss consulate in the country he is residing in. I don’t know why the U.S. is not capable of doing this. When I left the U.S. at age 16 I registered with the U.S. consulate in Zürich.
*@UncleTell, as far as I am aware US citizens living abroad are encouraged to register with US consulates, but it is voluntary.Given the way the US pursues its citizens abroad for taxes, most simply do not bother or deliberately avoid registring. Unlike with FBARs, Income tax returns and FATCA reports, there are no penalties or fines for failure to register. I can understand why Swiss citizens abroad are faithful in registering, but I wonder if there are any penalties for failure to fulfill this “obligation” to register. Do you know?
@Roger: it is my understanding that Swiss citizens are encouraged if not required to register with the local Swiss embassy/ consulate when living abroad – Uncle Tell certainly knows more about this than I do. I am aware of at least two reasons why they actually do it:
1) Swiss social security (AHV): similar to the US, Swiss citizens and others who have contributed to Swiss social security have a right to an old-age pension. This encourages Swiss abroad to register.
2) Swiss citizenship acquired from ancestors: in countries such as Argentina and Chile, there are many dual nationals who acquired Swiss citizenship from their ancestors (“ius sanguinis” concept). To retain their Swiss citizenship, as I understand it, they need to register with the Swiss embassy.
The Swiss government has tried to make it easier for Auslandschweizer to stay in contact by setting up a specialized “guichet unique” (portal) for them.
As a comment, in around 2005 I noticed an increasing number of Spanish speakers in my area of Switzerland. I came to understand that many of these were Auslandschweizer from Argentina, which had had a financial crisis, who had “returned” to Switzerland after several generations and were trying to make a go of it here.
Also, culturally, I would say that Switzerland tends to use the “carrot” more often than the “stick” to gain compliance. You are expected to follow the laws here, which are also rather straightforward, rather than compelled. The US seems to use the “stick” more often than the “carrot”.
*Innocente, I registered abroad with the belief that it was required to retain Swiss citizenship. My siblings, on the other hand, did not register and are still Swiss (I think). The idea is probably to encourage skilled workers to return to Switzerland. When living abroad, one can volunteer to contribute to AHV to not have a gap, but the conditions for qualifying for such have become more restricted. Swiss taxes are simple and friendly with requests rather than threats, and minor fines but no jail time. For some years, I was filing in August without having requested an extension, and they sent me a reminder to file. Once I submitted the papers after the reminder deadline, but no penalty was issued.
*It appears that there are no punitive negatives for Swiss who either fail to register, but that having registered may make it easier for good things to happen. Indeed this is the carrot rather than the stick approach, and that would explain why Swiss citgizens living abroad want to do it, which is an effective way that motivates them to register. It is indeed very different from the US approach which has just the opposite effect, like “I don’t want the IRS to be able to find me. because it will wipe me out financially.”
@SwissPinoy, this is from the http://www.ch.ch website:
Swiss citizens by birth
“Children of married couples are Swiss citizens from birth provided that either the mother or father is a Swiss citizen. The same applies for a child born after 1 January 2006 whose parents are not married. Children also acquire the cantonal and communal citizenship of the Swiss parent.”
As I understand it, if you or any of your siblings wanted to pass on their Swiss citizenship to their children then they would need to register both themselves and their children with the embassy as it’s only easily passed down from the parents. If you go back further than that there is a very narrow set of criteria that has to be met before grand (or more) children could obtain Swiss citizenship.
@ bubblebustin and all:
You ask “Where are these folks getting email addresses of USP’s?”
I just found out that a source of email addresses identifiably belonging to overseas “US persons” has been published on the web in the past year. I cannot name the source publicly, without advertising it to phishers; but it presents a severe threat to many of us here.
You might want to google your own email address (enclosing it in double quotes) to get a clue as to your current exposure. I did this and was shocked to find my name, address and telephone numbers, together with details which made clear my US person status, that had been lifted from a source that I had every reason to believe would be secure [thankfully not IBS nor Maple Sandbox (:))] . This information was re-posted on several very dubious websites.
After two nights of agonizing about the enormity of the vulnerability this presents, I think I’ve devised a way to protect against it, and will take the liberty of sharing it with you in (2) below.
1) However, first an explanation for my fears:
Targeted phishing, can be very bad, but awareness does provide some protection. (For which a big “Thank You” for this topic….)
However, the publication of lists of overseas US persons’ email addresses opens us to abuse by another, even harder-to-detect malware that could steal the data from our fbars completely without our knowing.
The exploit in question infects one’s computer by the simple opening of an infected email or even viewing it in the preview pane, unless all emails are opened only in plain text.
Once installed it lies in wait until a target website is accessed (such as an online banking site) and then generates a “false front” to the site. It has been used in online banking fraud, and was quite recently being reported as undetectable by antivirus software.
2) To protect against this threat, I have reluctantly now decided to purchase a new computer that will be used ONLY for the fbar filing and on which NO email will be accessed from my normal account, but rather only from a completely separate email account that will be used only for fbar.
(Yet another cost of this endless debacle, but better than the alternative…. When will it all end?)
And thank you so much, you good friends at IBS, for your support during this agonizing time. Blessings to all of you!
@ Sad-in-the-UK
Oh no! 🙁 But thanks for the information. I tried that e-mail search with StartPage and, thankfully, didn’t get a match but I will remain vigilant.
@Sad -in- the -UK
Whoa, this is not a good development. Will do as you have advised for checking and go from there. Thanks for this!
@Sad-in-the-UK
thanks for updating this old thread. Very interesting…