In our September 18 ADCS blog post we advised you that, for whatever reason, the United States Department of Treasury will now permit a one year extension, to September 30, 2016, to turn over private bank account information to the U.S. Internal Revenue Service, to comply with the U.S. FATCA law. However, the affected country HAS TO ASK FOR THE EXTENSION.
On September 18 we said on the blog:
“Well, it’s been quite a week. At approximately 4:45 p.m. today the IRS issued a notice confirming that the FATCA implementation date will be extended to September 30, 2016. As you know Canada has a Model 1 IGA. Assuming the correctness of the post in the above tweet:
Model 1 IGA Jurisdictions for Which the Obligation to Exchange Is In Effect — For those Model 1 IGA jurisdictions where the obligation to exchange is in effect now, Notice 2015-66 provides that FFIs in that country will be treated as FATCA compliant, and not subject to withholding, so long as the partner jurisdiction notifies the U.S. before September 30 that it requires more time, and “provides assurance that the jurisdiction is making good faith efforts to exchange the information as soon as possible.” Notice 2015-66 does not, however, change the deadline for FFIs to report information to their local tax authority, which remains governed by law of that country.”
We therefore instructed our legal counsel to notify the Government of Canada (and they have) of this development and request that the Government of Canada NOT disclose your banking information to the IRS.
— Today, September 21, we posted a new ADCS blog in which we specifically asked Canada’s Minister of National Revenue, Kerry-Lynne Findlay, a defendant in our lawsuit, to apply for the extension before September 23, the date the private account information is due to be sent to the U.S. IRS.
We said:
September 21, 2015
The Honorable Kerry-Lynne Findlay,
Minister of National Revenue
House of CommonsDear Minister Findlay,
We have an urgent time-sensitive request regarding our litigation in which you are a defendant, which we believe will be helpful to both plaintiffs and Government defendants, but which needs to be acted on no later than by end of business day September 22, 2015.
We are the chair and co-chair (and legal counsel) of the Alliance for the Defence of Canadian Sovereignty. We are the non-profit organization which is prosecuting the FATCA lawsuit against the Government of Canada. The lawsuit is “live”, “well” and expected to move to full trial in 2016. We are at: http://www.adcs.adsc.ca.
By way of background:
1. On February 5, 2014 the Government of Canada entered into a “Model 1” IGA agreement concerning the imposition of the U.S. FATCA (“Foreign Account Tax Compliance Act”) law in Canada.
2. On June 19, 2014 the Government of Canada enacted the FATCA enabling legislation through Bill C-31.
3. On July 1, 2014 FATCA became the law of Canada. The IGA required that Canada (via the CRA) report the banking information of those defined by the U.S. to be U.S. Persons to the IRS
4. The FATCA IGA required that the information be reported no later than September 30, 2015.
5. The Government of Canada has indicated to our legal counsel that it intends to report the banking information of those identified as “U.S. persons” to the IRS on September 23, 2015.
On the afternoon of Friday, September 18, the U.S. Internal Revenue Service issued Notice 2015-66, pursuant to which the deadline for the turnover of FATCA data (for countries with a Model 1 IGA agreement) has been extended for one year. Countries with a Model 1 IGA (including Canada) are no longer required to report to the IRS by September 30, 2015. It is required that Model 1 countries request this extension from the IRS.
See:
https://adcsovereignty.wordpress.com/2015/09/18/irs-extends-fatca-compliance-date-for-one-year-to-september-30-2016/http://www.irs.gov/pub/irs-drop/n-15-66.pdf
REQUEST:
In light of the large number of Canadian citizens potentially affected AND in view of the fact that the Government of Canada and the Minister of National Revenue are defendants in the Deegan and Hillis lawsuit AND in view of the fact that the Government is NO longer required to transfer the FATCA data to the IRS we request:That the Government of Canada apply for the extension, no later than by end of business day September 22, to NOT transfer the data with a view to meeting a September 30, 2015 deadline that is NO longer required.
Clearly, the Government of Canada, irrespective of its FATCA obligations to the United States, has the opportunity to not transfer the private banking information of innocent Canadian citizens to the United States Internal Revenue Service.
Your action in requesting the permitted delay in the transfer would be significant for both plaintiffs and defendants as we move down the litigation road.
Should you need more information I ask that you contact Mr. John Richardson our legal counsel and co-chair. [I included John’s cell phone number for Minister Findlay to make it easy for her to contact our ADCS legal counsel for further information.]
Sincerely,
Dr. Stephen Kish, Chair, Alliance for the Defence of Canadian Sovereignty
John Richardson, Co-Chair and Legal Counselcc:
Andrew Treusch, CRA
John Ossowski, CRA
Kevin Shoom
The Honourable Joseph Oliver
Letter sent this morning to Minister of National Revenue requesting FATCA turnover delay.
Thanks for advising us of this important step, Stephen!!
Great work Stephen & John!
One thought comes to mind….if the Canadian government were to proceed with reporting the information in spite of the possible delay. They would claim it was the law and so on. And then people are actually harmed by it and group together to file a class-action lawsuit. Would this be a possible deterrent? It’s not as if there aren’t enough already as outlined in the above letter.Litigation on two fronts plus an upcoming election. Plus the fact the Canadian government as nothing to gain by proceding. At least as far as we know, they have nothing to gain by doing so………
Thank you for the letter. I’ve contacted and received responses from all but the Green Party candidate (for obvious reasons that FATCA repeal is part of their election platform). The NDP has forwarded it to “campaign central” and although my Liberal candidate asked me for further information, I don’t know if she’s sent it up the chain right yet. I’ve been playing phone tag with John Weston’s office which I was able to brief somewhat via his assistant with a text message. I’m hoping to hear from her, and maybe John himself this afternoon. I will urge him to contact Minister Findlay now that she’s been made aware of the situation. What I hope to drive home, and certainly what Minister Findlay should know is that once the data is sent, not only is the data of innocent Canadians being sent to the IRS, but the mere sending of it will deny them the ability to enter any IRS amnesty programs to prove that innocence!
I’ve also sent the info to Maura Drew-Lytle, Communications Director with the Canadian Bsnkers Association. We too have corresponded in the past where I was actually got her to change some information on their consumer info page that would allow consumers to learn that the banks allow a “reasonable explanation” for not having a CLN. I expect she will return my email as she’s always done in the past. Even though the banks still have to report, I would hope that it would improve their customer relations to be able to tell people there’s a delay.
I sent out a dozen e-mails (individually) — party leaders and some ministers. Only AUTO REPLIES and one MAILER-DAEMON so far.
EmBee,
There should not be an auto-reply to an email sent to a key defendant in our lawsuit who could stop the September 23 turnover:
Kerry-Lynne.Findlay@parl.gc.ca
If the information is sent then the lawsuit down’t matter. You can’t turn back the clock on all that disclosure.
About the same for me, EmBee, except for my almost instantaneous reply from Nathan Cullen, NDP. I did, though, have an on-the-spot meeting with the NDP candidate in my riding — and I am more confident that he has now been better educated from our one-on-one conversation. I know, even though I had provided him information previous to our face-to-face meeting, that he really DID NOT *get it*. It’s one more candidate educated, but it is not the NDP Party Leader, Thomas Mulcair, making FATCA an election issue.
My Liberal candidate told me right out that the IGA that implemented FATCA law in Canada will not be an election issue for the Liberals. I have heard Mr. Trudeau say a couple of times that *A Canadian is a Canadian is a Canadian*. I am not confident that I can believe him for *US-deemed US citizens / persons* who happen to reside in Canada.
The economy is said to be the most important issue in the Canadian election. I believe that all Party Leaders but Elizabeth May are AFRAID to inject FATCA and its consequences on Canada, all Canadians and US-deemed US Persons in Canada into their promises and along with other important issues for this country. We must continue trying, doing what we’re doing.
There couldn’t be a worse time for trying to make contact with Canadian ministers so I’m hoping the twitter activity, the legal notification and Stephen’s letters get this message through in time. BTW, I fixed my mail demon (incorrect address) but still only have auto replies. I’m really not expecting anything more … they are all too wrapped up in electioneering right now.
@ Neill
You are right but at this time we have no idea how many FATCA reports are in the CRA data bank. If the banks haven’t been too diligent then maybe the numbers aren’t too high … one can hope.
Well I finally talked to my MP, John Weston’s assistant. Apparently there’s all kinds of election rules placing barriers between constituency offices and their MP’s during election time, making it hard for her to even know where he is. She did say however that she’ll call the Revenue Minister’s office today, after I’d told them ADCS had sent them a letter.
Among other things I mentioned that the government claims they had no choice but to enter into the IGA. Here’s an opportunity to do something good for millions of Canadians, I said.
I suspect our government officials might be compelled to do all kinds of things – if there’s a possibility they might find something in it for them…
@Neil, “If the information is sent then the lawsuit down’t matter.”
FALSE
The number of reported accounts should increase each year as formerly non-detected accounts become detected because of changes to existing accounts and new account openings.
I would suspect that this years reporting is rather low as it would include few pre-existing accounts.
The FATCA IGA is like a weed, you pull it out when you can pull it out. When a weed is a giant weed do you let it stay in the ground saying too late now? No, you pull it out before it spreads its seeds!!!
@Bubbles et all……. this effort may fail however, it will provide documentation to ADCS that extreme effort was made to notify the Government and if they fail to act, they SHALL bear the reponsability both morally and financially for their inaction.
Should they report when they did not need to report, a claim can be made for damages. Here in the UK, I have now seen billions paid in damages by the banks for what seemed rather innocent.
@Neil, one more example…non Canada but still a valid example…..
I am clear of the dragnet having relinquished but my minor kids are not.
My kids have assorted financial accounts. They were invisible for various reasons as of December 2014, they were not detected as of year end..absolute fact.
They may or may not be invisible 12-2015.
They may or may not be invisible 12-2016.
The lawsuit does matter and it matters for many.
I am positive the Government would love to go into Court and say “We can appreciate that there may have been an unfortunate disclosure but its too late now, so let us continue with the disclosure because its already done, the damage can not be fixed so lets at least protect the banks.”
@Bubbles…..I am eight time zones away….thank you for all the work you are doing, it is important for Canada, it is important for the Commonwealth, it is important for former-pats worldwide.
Thank you so much……….
You’re making progress, bubblebustin. I’m glad you paved the way for your present actions and, especially, clearly communicating…
Someone will be held accountable if information now is sent on September 23rd.
Thanks so much for what you’re doing — and congratulations on the inroads, however small they may seem to you, that you’ve made. Bravo!
I don’t think we have to worry about the information being reported to who needs to hear it – our lawyers and the government lawyers are in discussion about this and I trust they know what to do with the information.
That others need to know, of course. But I think we can depend on the fact that the appropriate people have the information. Ball is in their court now…….
Thank you, Calgary and George.
I don’t think I’ve ever been driven quite like this ever before in my life. It’s kind of like someone else is steering me, but I know I am. I hope I end up somewhere.
That’s great news, Trish!
I want to re-iterate what I said over the weekend that the current Harper government is in a “caretaker” mode during the election writ period(and after if it is not obvious what the election result is immediately). Thus they and the civil servants at CRA, Justice, and Privy Council are mandated by constitutional convention to postpone all but the most non controversial decisions until after the election or consult with the opposition parties. While I do believe that “non controversial” is something that can be twisted I believe that with appropriate public and legal pressure both Harper and the civil service can be compelled to uphold their legal obligations.
As I said earlier I would recommend contacting the CRA Commissioner and Privy Council Office directly to remind them of their caretaker “obligations” during this election period.
http://www.clerk.gc.ca/eng/index.asp
http://www.pco-bcp.gc.ca/index.asp?lang=eng&page=convention&doc=convention-eng.htm
I also believe that members of the civil service who refuse to comply with the caretaker conventions during this election should be subject to disciplinary action if a new government is elected.
“In short, during an election, a government should restrict itself – in matters of policy, expenditure and appointments – to activity that is:
(a) routine, or
(b) non-controversial, or
(c) urgent and in the public interest, or
(d) reversible by a new government without undue cost or disruption, or
(e) agreed to by opposition parties (in those cases where consultation is appropriate).
In determining what activity is necessary for continued good government, the Government must inevitably exercise judgement, weighing the need for action and potential public reaction, given the absence of a confidence chamber and the possibility that a different government could be elected.”
@ Tim
Did you get any reply (auto or otherwise) from the Privy Council clerk?
Tim, thanks for the suggestions.
I already had contacted the CRA Commissioner and have now sent an email to the Clerk of the Privy Council.
Bad move guys.
The potential delay is conditional on Canada making a good faith effort to eventually comply. Canada should not be making any such good faith effort to eventually comply. As much though I would like to see a delay, the US conditions attached to this particular potential delay were unacceptable. As such the delay should not have been requested at least not via this mechanism.
I appreciate that others on this thread have commended your decision but I’m sure you’ve figured out by now that I always speak my views and don’t blindly follow either side.
@Dash1729
The whole good faith business is a bunch of BS and even the IRS knows it. How can the current “caretaker” government commit that a future government will comply with FATCA. Plus I reiterate my view that during an election writ period the Government is required to undertake the least controversial and easiest to reverse option and that is to “request” a delay which from what I hear is purely perfunctionary.
If a future government decides to repeal FATCA in Canada what can the IRS do. Say we were acting in “bad faith” Please. Screw the IRS in such circumstances.
@Dash
FYI, I was the one who first found out about this delay on Friday and started this present train moving.
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