As Innocente notes, the Quarterly Publication of Individuals Who Have Chosen to Expatriate for Q4 2013 is now available for public inspection on the Federal Register website. The list has a bit more than 630 names; the usual caveat about the completeness of the list applies, especially seeing as, once again, the FBI’s count of renunciants is greater than the IRS’ count of renunciants, relinquishers, and green card abandoners combined.
Update: the FBI has also posted its latest monthly report on Active Records in the NICS Index, which showed 24,127 records in the “Renounced U.S. citizenship” category, up by 320 since the beginning of the year. That suggests the total number of renunciants and relinquishers during January was around 600. According to the Federal Denials report, NICS also caught one firearms purchase attempt last month by a renunciant or, more likely, a person fraudulently using a renunciant’s identity.
With the latest Federal Register list, fresh list author Maureen Manieri may have broken the United States of America’s tax laws in a creative new way: not just by submitting the list for publication after the 30-day deadline, but by disclosing information in violation of 26 USC § 6103, “Confidentiality and disclosure of returns and return information”: one entry in the list contains not just a name, but other information whose disclosure is illegal.
Tax confidentiality and the “name-and-shame list”
26 USC § 6039G(d) grants an exception to § 6103’s confidentiality provisions for the publication of the “name of each individual losing United States citizenship”, but not any other information. Confidentiality has clearly been violated: one entry in the list is not a name but rather a suburban street address, probably the home address of a former U.S. citizen which the IRS got from a Form 8854. However, it’s unlikely that Ms. Manieri will lose her life’s savings or be threatened with prison for whatever paperwork or spreadsheet error caused an address to get included in what is supposed to be a list of names and nothing but names; § 7213 only criminalises willful violations of § 6103:
It shall be unlawful for any officer or employee of the United States or any person described in section 6103 (n) (or an officer or employee of any such person), or any former officer or employee, willfully to disclose to any person, except as authorized in this title, any return or return information (as defined in section 6103 (b)). Any violation of this paragraph shall be a felony punishable upon conviction by a fine in any amount not exceeding $5,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution, and if such offense is committed by any officer or employee of the United States, he shall, in addition to any other punishment, be dismissed from office or discharged from employment upon conviction for such offense.
In other words, IRS employees — tax experts, allegedly — who willfully break the very well-known tax return confidentiality provisions of the tax code in the course of performing their duties, face a lower statutory maximum fine than civilians with no tax expertise whatsoever who non-willfully break the obscure Bank Secrecy Act and fail to file an FBAR (31 USC § 5321(a)(5)). And that’s not even counting the IRS’ “let’s invent a new fine” Offshore Voluntary Disclosure Program, in which people who didn’t even know the U.S. still deemed them to be its citizens were threatened with fines or even criminal prosecution if they “opted out” of the OVDP.
Meanwhile, bankers all around the world are pressing their local governments for exemptions from data-protection laws so that they can send private data about local citizens deemed to be U.S. Persons to this same IRS which so casually flouts its own confidentiality laws. (In the context of international information exchange, § 6105 allegedly provides a similar prohibition against disclosure of “tax convention information”; you may decide for yourself whether this is likely to be worth the paper on which it is printed.)
Count of names in the list
So this quarter’s list contains about 630 names, bringing the total number of Federal Register published expatriates for 2013 to just over three thousand. Aside from the street address, there don’t appear to be any other egregious name errors like Vice Consul, Imagine International Reinsurance, or the Israeli town of Kfar Saba (one unusual entry in this list, “Not Vital”, is, as Innocente points out, the name of a real Swiss artist). Oddly enough, the FBI has not yet released its latest report on active records in the NICS system for January 2014.
Famous people in the list include Taiwanese basketball player Quincy Davis (p. 4; also previously discussed by us), Zurich mayor Corine Mauch (p. 11), and Hong Kong banker Marshall Nicholson (p. 12), However, Pakistani politician Fauzia Kasuri and Cuban intelligence officer René González, both of whom renounced in the first half of 2013, do not appear; nor does Tina Turner, though her relinquishment is probably too recent for the IRS to wake up and notice it, and I seriously doubt her name will fail to appear, eventually.
More renunciations, or just fewer unpublished names?
So judging from Wikipedia data, it looks like 2013 is on track to have a far lower rate of non-inclusion of known ex-Americans than previous years: only one or two out of eleven public figures, in contrast with 2011 and 2012, which both saw four out of eleven or twelve newly-minted ex-Americans with Wikipedia articles failing to appear in the Federal Register. This leads to an interesting question: has the “FATCA effect” really kicked in yet?
Most media reports seem to assume that the recent large jump in the number of names in the Federal Register is driven by changes in tax laws, but there’s an alternative hypothesis: that just about as many people gave up U.S. citizenship this year as in any other recent year, but the IRS and State have cleaned up their procedures enough that far fewer of those people’s names inexplicably go missing from the Federal Register.
Homelanders assume that everyone whom the U.S. government considers to be a U.S. citizen knows that they remain U.S. citizens and has heard of FATCA because they avidly follows the news coming out of the Homeland, as illustrated by Bill Yates’ earlier comments to Virginia La Torre Jeker:
Then, TP sends in a request for an 877 PLR, our very first one, and it lands on my desk. AC was represented by a London practitioner who is now a friend of mine. I read the request and became incensed. How could anyone not know they were a U.S. citizen?!!! … When TP explained that AC was an accidental citizen, I thought he was just giving me a line. After awhile, after working a bunch of 877 PLRs, I realized we didn’t know anything about anything when it came to U.S. citizens working overseas, accidental or otherwise.
Certainly, people who are aware that they are U.S. Persons most likely know about FATCA by now — but of course, the very reason that many of them are aware of FATCA is that they actually pay attention to U.S. business news, and bother to remember it because they understand that they are in the category of people to whom FATCA applies. These are, simultaneously, the people who are least likely to be integrated enough into their countries of residence that they are legally and emotionally prepared to escape FATCA by naturalising where they live and giving up U.S. citizenship. (Meanwhile, wealthier U.S. citizens both in the Homeland and abroad are busy setting up fancy structures to get around FATCA’s reporting requirements, as the WSJ pointed out last year.)
Conversely, accidentals who aren’t aware that they have U.S. citizenship, or think they lost it because they never “affirmed citizenship” after becoming adults — as would have occurred under 8 USC § 1482 until it was repealed during the Carter administration — at this point still are not likely to be paying much attention to legal and taxation news from the country containing the hospital where they or one of their parents happened to pop out into the world decades ago. And when they read domestic headlines about crackdowns on “international tax cheats”, they don’t even realise that the headline writer’s libel is directed against them specifically. They’re busy now reading about their own interests and living their own lives, and quite possibly nothing is going to make them aware of this issue right up until the day when their banks sends them nasty letters with threats of fines and account closures if they don’t fill out a W-9.
To add to the above, 335 Americans naturalized in Switzerland in 2012 and 283 in 2011. I would expect that the number of Americans naturalizing here will increase and that the newly naturalized will be prime candidates for expatriation:
Why can’t Americans abroad renounce and relinquish their U.S citizenship freely? Where is the U.S. freedom?? What a heck! If a U.S. person has never spent a dime or used any welfare service or health care or anything from the U.S. government to be penalized. why is that? Isn’t it stupid? ……and the U.S. government and its administration wonder why they have deficit of 13 Trillions of debt to pay? guess what? with those upside down ideas: taxing citizens abroad, extorting and bulling others, stealing and fighting in wars, killing innocent people, it only takes the whole US country down to hill faster than ever. And the true is: sooner or later everyone in the U.S government will die too anyway. I don’t think any of them have rationalized well.
I know one person who renounced a year ago and has not yet appeared on any of the quarterly lists, nor have I who relinquished in the 1970s and received my CLN early last year.
On February 14 of last year a request was made to Data.gov for periodic reports of the numbers of CLNs being issued:
The request has been listed as “Under Review” ever since but no action.
The whole US CLN process is another baffling example of “American Exceptionalism”. Where else in the world must one go through such a time-consuming and (for many) expensive process to receive documentation of voluntarily giving up membership in an organization one never volunteered to join in the first place? Anyway, I’m proud to be a member of the club of certified ex-citizens of the US. I just wish we could find out how many members there are in our club and how many are continuing to join us.
By the way, the words of Hotel California have it backwards: You can leave the US any time you like but they make it really hard to check out.
They have always been worried that the wealthy will just leave. I have looked at the 1962 figures (before the U.S. taxed worldwide income of non-residents) and the striking thing is that there were very small numbers of the very wealthy living in tax havens (Switzerland and Venezuela). More of them lived in Britain, which had higher taxes, but the fear remains.
The U.S. is highly dysfunctional when it comes to balancing taxing and spending. It is much easier to push the burden off on to a group that has not been politically engaged. This is probably the darkest period. A number of key FATCA champions are weak. Most importantly, Charles Rangel, who wrote the FATCA legislation according to the Thomas.gov system, is 83 and has been censured for, among other things, not declaring $75,000 in income.from a villa he owned in the Dominican Republic (and yet they let him stay on Ways and Means, which writes the tax rules)! He came close to losing the primary in 2012 and the same opponent is back for 2014.
Time to debunk the myth of the tax-free expat
At yahoo Finance…
@ Just Me
There’s no point sending us off in a hundred directions at once. The FATCA cat is out of the bag, running rampant and unless we stay focused on something we will just be spinning our wheels, getting nowhere. I’m going to concentrate on some e-mails to Canadian MPs today and that’s about it. I had to wait a couple of days in order to make sure I don’t put something in those e-mails to merit a visit from the RCMP.
@FATCA_Fallout, meet @mandiwoodruff. I’ll leave you together for a while to get acquainted.
@AnonAnon …”PROUD.to be a member of the club of certified ex-citizens of the US” …Rev Susi just said her name was published…. I think DoS are being told to target for publication people who they view are, or might be, prominent in some way………. how hard can it be?
1. Receive CLN
2. open CLN paper pack
3. read name
4. type name into database.
I too have this vision of some poor maven deep in the bowels of State being overwhelmed by “stuff”…..regardless of the legal swirl and whirl DoS could or shoud publishk, ….the REAL number of USPs (citizens. Green card holders) renouncing is clearly highly sensitive info
I too would love to sign the RNC online petition agianst FAtCA but I disagree powerfully with the amount of personal info required-who knows-maybe the IRS has set this up andwould harvest the data for further audit targets.
double hm. I am turning into conspiracy theorist here …”just because you are paranoid doesn’t mean they are not out to get you”!!
strength and honour , folks!!!
@crystal london, prominence can’t be the criterion for inclusion in the quarterly lists, because I know of several people who are not at all prominent but have nevertheless made the list. The key should be related to the phrase “(within the meaning of section 877(a) or 877A) with respect to whom the Secretary received information during the quarter”, but I haven’t seen anyone able to explain what that phrase means or how it is being used to select names for the lists.
A big part of the effort I make is to try to help those in the media to see what’s really going on here. If a great number of them begin to “get it” (and more and more are trying) then the truth about what’s happening to Americans abroad will be unleashed upon the world. I’m looking forward to the day that truth reaches the tipping point and momentum gains in our favour. If not for me, for my grandchildren. Until then, I do what I can no matter how small or seeming inconsequential.
Here’s an estimate of the percentage of US citizens in Switzerland who expatriated in 2013 of the total US citizens eligible for expatriation:
Swiss citizens born in USA, resident in CH: 16,005
less expatriations: 2,780 (2013: 1000, 2012: 900, 2011: 180, 2004 to 2010: 700 (100/ yr))
Swiss citizens with USC, resident in CH: 13,200 (say)
1000/ 13,200 = 7.5% of USCs with CH citizenship and resident in CH expatriated in 2013
Look for 2014 being another record-breaking year!
@Eric: thanks for the updating your blog with the FBI NICS figures.
Americans Renouncing Citizenship Up 221%, All Aboard The FATCA Express, Robert Wood, Forbes.
WSJ: Expatriations Rose to Record Last Year
Thanks, here it is not behind a paywall:
Update: My representative’s assistant contacted someone at the Department of State, who said that they have an enormous backlog of FOIA requests, and that my request could take about a year to process. It is not an urgent matter so it cannot be expedited. Therefore, the assistant said that my representative will formally inquire the Department of State to ask for the information directly, and then send the response to me.
Thank you for keeping us up to date, Shadow Raider. What do you think about Canada’s FATCA capitulation? We’re reeling.
In case you aren’t aware, Brock now has a place to put new media items that can be commented on here:
@bubblebustin, I didn’t expect Canada to give up so easily. I thought it would insist on excluding Canadian residents from FATCA (like it did for the various 4-letter accounts), or at least drag the negotations longer. I see that a few more countries have also signed an IGA: Mauritius, Italy, Hungary, and according to the media, Slovenia is next. The list is getting more diverse than just the usual US allies. I can’t understand why the US is being so stubborn with this stupid project, and why the world keeps accepting it.
I agree with Jim Jatras, FATCA will eventually collapse after it’s implemented anyway. I think the RNC should move its focus away from FATCA, and toward CBT and the FBAR, which are the real problems.
It’s Official – Expatriations in 2013 Set New Record
I put a comment suggesting that Brian google this blog post by Eric.
2,999 expatriations for 2013. What a joke?
Some bureaucrat obviously had an order to keep the body count below 3,000 and did just that.
The number of increasing expatriations is highly sensitive. Uncle Sam is coming to regret the name and shame list because its naming and shaming Uncle Sam himself.
Soon they will suddenly declare the list of expatriations needs to be protected under some obscure privacy act and will disappear from the public domain just like the money supply aggregate M3 did in 2005/06.
The Death of M3: http://mises.org/daily/4859/
Uncle Sam is a narcissist and can never admit that its policies are wrong — better to hide the numbers.
Watch this space.
The 2999 figure is a joke. I thought of the same thing too when I first saw it. Uncle Sam is the one who is ashamed.
Americans who abandoned citizenship jumped 1,402% last quarter
@ brockers. …. .the sovereign man post moved me to tears. “You are who you are no matter what color your passport is.”…… I still have family[ and friends who are family really] Stateside,,,,,, the reference to Rome is also appropriate. as Catullus said …………”ave atque vale”…….. and as Google translate says “Doleo tamen vivens in libertatem”.. !!!! Brockers rock!
New article from Patrick Cain:
February 12, 2014 12:29 pm
‘U.S. list of ex-citizens full of errors, duplication’
By Patrick Cain Global News