The Plaintiffs (of which I am one of seven) of the Republicans Overseas United States FATCA lawsuit, filed, on July 5, 2016 in U.S. Sixth Circuit Court of Appeals, a “Brief” arguing that the U.S. District Court erred in dismissing the FATCA lawsuit.
We are suing: United States Department of the Treasury, United States Internal Revenue Service, and United States Financial Crimes Enforcement Network. SEE THE BRIEF.
— Portions from the Brief:
“The district court held that no Plaintiff has standing for any of the eight counts (Dismissal Order, RE 42), even with added plaintiffs and facts in the proposed Amended Complaint (RE 32-1).”
“Preliminarily, note that while the Government asserts interests in fighting tax evasion, money laundering, and terrorism, Plaintiffs are ordinary people abroad seeking freedom from serious harms from challenged provisions and IGAs. Plaintiffs are not alone. An extensive, careful survey,[from Democrats Abroad…]”
“The Government has other, successful tools to catch scofflaws without the unconstitutional, intrusive, bulk-data-collection approach of the challenged provisions and IGAs that so harm ordinary Americans.”
“Taxpayer information was recently stolen from the IRS itself because the IRS has not prevented hacking of its own systems and theft of taxpayer information.”
“Thus, people do have a reasonable expectation of privacy from the U.S. and foreign governments in their bank accounts under the situations at issue here. They reasonably do not expect the bulk, blanket reporting of information under challenged provisions and IGAs, including to foreign governments, without any hint of wrongdoing and without judicial oversight, the lack of which makes such searches “per se unreasonable.”18 So Plaintiffs have a cognizable privacy interest.”
“…Plaintiffs rely on no third-party standing, though they provide information about relevant third parties to demonstrate how FATCA negatively affects their lives and relationships. Rather, they rely on their own interests, especially the constitutionally protected interest in not disclosing information they do not want to disclose.”
“The district court said that because Plaintiffs harms, particularly problems in getting banking services for essential everyday-living accounts,20 are not fairly traceable to government action, Plaintiffs lack standing to challenge provisions motivating FFIs not to provide services to Americans abroad….So the argument is not that, e.g., the IRS persuaded some bank to deny services to Plaintiffs Crawford or Kuettel, but that FFIs don’t accept Americans’ accounts because of FATCA/IGA burdens. Where a provision/agreement harms a person by causing FFIs to deny services (or by disrupting marital joint accounts or the ability to open an account in a minor’s name), that harm is fairly traceable to the government responsible for the provision/agreement.”
“The law on causation for standing recognizes such indirect harm. For example, Plaintiffs affected by FATCA/IGAs have standing for the reasons stated regarding Count 1 because the FFI Passthrough Penalty is designed to punish noncompliance by account holders. And Plaintiffs would like to be noncompliant because they are burdened by FATCA/IGAs, which they believe are unconstitutional, but cannot be recalcitrant because of the Passthrough Penalty.”
“Furthermore, Plaintiffs alleged that they reasonably fear that they will be subject to the Willfulness Penalty for willful failure to file FBARs, indicating that they are filing FBARs. The FBAR report is a trap for the unprepared, uninformed, unwary, imposing this excessive penalty on those who know of the report but for some reason fail to get it done.”
“Moreover, Plaintiffs’ harms will be redressed by requested relief as to this Count. See Part I.C. Any notion that they must await a penalty or enforcement action is erroneous because one need not await enforcement to challenge unconstitutional provisions/agreements. And Plaintiffs would not file FBAR reports—and so become subject to this penalty—but for the challenged provision. So Plaintiffs have standing for Count 6…”
U.S. District Court dismissal of FATCA lawsuit has just been appealed.
“Any notion that they must await a penalty or enforcement action is erroneous because one need not await enforcement to challenge unconstitutional provisions/agreements.”
That’s how I see it too. To mangle a familiar old saying: An ounce of prevention (repealing FATCA) is worth the effort in order to eliminate the predictable pounding of expats by unreasonable FBAR penalties. The goal should be to stop the inevitable harm, not wait for it to happen just so plaintiffs have the “standing” that the first judge wrongly required. I hope the next judge can see this because it seems quite simple to me. Good luck with this appeal!
Good news. Maybe you can get Hillary to be a witness. She wrote in a letter to American’s abroad:
“FATCA’s intent was to catch wealthy tax cheats hiding money abroad. But in practice, banks are refusing to provide average law-abiding Americans abroad the basic financial services they need because of the compliance requirements of FATCA.”
By writing, “Financial institutions that enjoy the privilege of operating in our economy and abroad need to be held accountable”, some actually read this letter as a veiled threat to impose sanctions against banks who refuse business to Americans because of FATCA. If true, Hillary proposes to punish FFI’s on something a US court claim isn’t happening.
Hillaryous that Democrats Abroad need a Republicans Oversees victory here to further their Same Country Safe Harbor scheme.
Oops, coffee not in brain yet – I guess DA wouldn’t need to, as a RO success would defeat FATCA I assume.
How can DA even continue pursuing SCSH with the current verdict?
I would feel more comfortable if RO communicated more in regards to this lawsuit. We don’t hear much from them. In comparison we hear on this site quite frequently in regards to the Canadian FATCA IGA Lawsuit.
I Just made the appeal announcement for RO on Twitter: https://twitter.com/JCDoubleTaxed/status/750845943071727616
May we agree to call the suit the FATCA/FBAR Lawsuit? Ok so 7 claims against FATCA and 1 against FBAR. This does not mean we should belittle the FBAR part. Also, none of the DA or Democrats ever could acknowledge the FBAR part which signals to me that perhaps it should be called the FBAR/FATCA Lawsuit.
I would like to see the FBAR part expanded to include FBAR career limiting aspects – such as requirement to report employer accounts – way unacceptable for nonUS company for nonUS residents. No doubt more counts needed against FBAR – maybe this would attract more funding as there has been lots written against the notion of reporting to The Financial Crimes Enforcement Unit.
Hi folks. Victoria here. 🙂 I’m sort of following the lawsuit stuff but mostly I’m working on my Masters dissertation and I’m doing research here in Japan. I know this is a bit off topic but I know there are folks living in Japan here and I could use the help. So allow me thorw myself on your mercy.
I have a survey up called Native English Speakers Residing in Japan and I do have one question in there about renunciants (people who have become Japanese). So if there is anyone here who qualifies (native English speaker living in Japan) I would great appreciate your participating in the survey. And if any of you know of people in Japan who might qualify for the survey I would sure appreciate your passing along the link. And here it is:
Thanks, folks, and kisses all around 🙂
Victoria (the insane woman who went back to school at 50…)
Great news that the appeal has been filed! Here’s to its SUCCESS!
I’ve just finished reading the entire appeal document and, I must say, Mr. Bopp has done a magnificent job! Wow!
Possibly helpful to this US or another of the legal challenges to FATCA? Haven’t read the TAS report yet.
Thursday, July 7, 2016
Taxpayer Advocate Mid-Year Report to Congress: IRS Implementation and Enforcement of FATCA Withholding Is Burdensome, Error-Ridden, and Fails to Protect the Taxpayers’ Rights
By William Byrnes
Mention of privacy issues, and of enforcement bias against ‘international taxpayers’ – ex. international students, and “…. the IRS must abandon its enforcement-only bias against international taxpayers…….”
“I have a survey up called Native English Speakers Residing in Japan and I do have one question in there about renunciants (people who have become Japanese).”
I think people who take Japanese citizenship, for which Japanese law requires them to have the intent (and subsequently perform) to lose their previous citizenships, these people would be relinquishers not renunciants.
I am a renunciant. I used to be a dual Canadian and US citizen residing[*] in Japan, and now am a Canadian citizen residing[*] in Japan. I did not become Japanese.
[* I originally hoped to reside here 2 years, which would require one renewal of permission to remain for 1 year at a time. I did not expect that to grow to 28 years, with renewals of permission to remain now lasting 5 years at a time. I do not wish to take permanent residence in Japan. Nonetheless temporary residence is residence and I don’t have any other residence.]
“Thursday, July 7, 2016
Taxpayer Advocate Mid-Year Report to Congress: IRS Implementation and Enforcement of FATCA Withholding Is Burdensome, Error-Ridden, and Fails to Protect the Taxpayers’ Rights”
I read a similar report several months ago, which of course Congress already ignored. Did she really do another one this month with a similar title? Does anyone think Congress will care this time?
Maybe the RO and the ADCS could point this latest atrocity of discrimination against individuals who are innocent of wrongdoing – see report into secret hidden documents wherein the US Treasury and Justice Dept. chooses NOT to prosecute large FIs in the US where there is actual reason and evidence to prosecute (yet chooses to threaten and persecute minnows ‘abroad’ without cause using FATCA IGAs);
Tuesday, July 12, 2016
‘Too Big to Jail: Internal Treasury Documents Reveal Why Justice Department Did Not Prosecute HSBC’
By William Byrnes
“The House Financial Services Committee on Monday released a staff report http://financialservices.house.gov/uploadedfiles/07072016_oi_tbtj_sr.pdf of its investigation into the U.S. Department of Justice’s decision not to prosecute HSBC or any of its executives or employees for serious violations of U.S. anti-money laundering laws and related offenses.
The Committee initiated its investigation in March 2013. The Department of Justice (DOJ) and the Department of the Treasury failed to comply with the Committee’s requests to obtain relevant documents, necessitating the issuance of subpoenas to both agencies.
Approximately three years after its initial inquiries, the Committee finally obtained copies of internal Treasury records showing that DOJ has not been forthright with Congress or the American people concerning its decision to decline to prosecute HSBC.
These documents show that:
Senior DOJ leadership, including then-Attorney General Eric Holder, overruled an internal recommendation by DOJ’s Asset Forfeiture and Money Laundering Section to prosecute HSBC because of DOJ leadership’s concern that prosecuting the bank would have serious adverse consequences on the financial system.”……..
IS THIS NOT more evidence for a NAFTA or WTO complaint about the FATCA IGAs? The US says it will punish non-compliant ‘foreign’ FIs and the ‘foreign’ accounts of people outside the US, yet absolves and chooses NOT to prosecute US banks – even where there is ample evidence of money laundering and the other abuses that FATCA purports to target.
The hypocrisy is such that it makes even clearer what fools and asses Canada and other IGA signatory countries have been to sign the FATCA IGAs and to pretend to their citizenry (at the behest of local Banksters) that the cost to our sovereignty, autonomy and economy and accountholders and taxpayers is a ‘good’ deal.
‘Too Big to Jail’
Close. Campaign contributions were too big to let the donors be jailed.
It’s not just HSBC. If prosecutors threatened to penalize TD executives instead of TD minnow customers, TD would buy them off too.
Interesting re FATCA;
Alsheikh v. Lew et al
Alsheikh v. Lew et al
Plaintiff: Abdullah Saleh Alsheikh
Defendant: Jacob Lew and John A. Koskinen
Case Number: 3:2015cv03601
Filed: August 6, 2015
Court: California Northern District Court
Office: San Francisco Office
Presiding Judge: Jon S. Tigar
Nature of Suit: Other Civil Rights
Cause of Action: 28:1331
Jury Demanded By: None