RefugeeFromAmerica was in contact with BMO’s President’s Office about BMO’s FATCA policies and also with the CRA Commissioner’s Office and has sent in the following report.
In response to the CBC story about the vast number of bank accounts reported to the CRA/IRS, I thought I’d share an experience we had at a BMO branch back in August. In particular, I wanted to provide a data point to corroborate the suspicion that at least some Canadian financial institutions are not observing FATCA reporting minima and that, at least at the local level, they are violating Canadian law by not readily providing information to customers about FATCA reporting. Quoted below is a previously composed account of what transpired during our branch visit [and the events that followed it]
“…our entire family had an appointment at the main BMO branch in our home city in the Maritimes today to take our CLNs in to verify that all US indicia were still absent from my and my wife’s accounts (since we had previously done this shortly after renouncing in 20XX) and to have all US indicia scrubbed from our daughter’s banking information now that she is also no longer a US citizen. The bank staff seemed puzzled at first at our request but gladly complied after some explanation about CBT/FATCA and our renunciations. The interesting part began after that step when I asked how I might go about obtaining a written report from BMO detailing what, if any, of our family’s banking information had ever been shared with the CRA, under FATCA, for transmittal to the IRS. The customer service agent had no idea what to do and consulted his manager, who also had no idea what to do. So, the agent called someone at the BMO corporate office to inquire and, when fully revealing to that person what we were asking for, had the person on the phone turn extremely hostile to them. They told the branch agent that there was no way for BMO to obtain or report this information to any customers and that they would not give us any contact information for anyone at BMO who could help, not even legal department staff. At the end of the call, the branch agent told us that they were very rattled by how hostile the corporate person was to them about this topic and that they had never experienced this kind of behaviour before. After conferring with the branch manager for a long while after this phone call, they both came back to the office to talk to us. The manager told us that they would look into this situation and get back to us as soon as possible with some answers. The most shocking revelation came from what the manager said just before we left. She indicated that she personally was responsible for forwarding local accountholder information to the CRA for FATCA compliance purposes and that she forwarded information for ALL accounts having any US indicia! Upon questioning, she clearly stated that there were no minimum balance thresholds being observed and that any account having US indicia got reported. I know there has been lots of discussion over the years after FATCA came into effect about whether banks would follow the minimum reporting guidelines in the law or just report everyone to be on the safe side. Well, at least at this branch (and likely company wide), it appears that BMO is reporting everyone.”The branch manager never followed up with us as she promised to do, so we filed formal demand letters with both the BMO president’s office and the CRA in an attempt to force them to hand over any and all information about FATCA transfers of our financial information. We received a letter from the CRA Commissioner’s Office indicating that we would receive more information from the CRA about this at a later date and I have been in contact with a complaint resolution officer at BMO who has been working with me to get the information we are demanding. One interesting tidbit from BMO was that our daughter was, indeed, flagged for FATCA reporting with US indicia, even though the local branch agent said she was not. A form RC518 had to be formally filed with BMO to clear the FATCA reporting flag from her accounts. We are still waiting for the final report from them about what got reported previously.So, the bottom line is that it looks like BMO is likely reporting everyone, regardless of account balances, and at least some BMO staff/managers do not know anything about how to clear US indicia or about their legal obligations to provide information to customers about what BMO has reported to the CRA, and ultimately to the IRS, about them. I think it would behoove all renunciants and other concerned parties to follow up officially with the CRA and their bank’s corporate office to confirm if they are flagged for reporting and what information, if any, has been previously sent. Even if you have renounced and notified your bank, you may still have your information reported indefinitely, unless you make a formal inquiry. You simply cannot take a branch agent’s or manager’s word for being in the clear.
Even with all the hoopla in recent years, there are still large numbers who aren’t even aware they are supposed to file. The refusal of the banks and the CRA to inform individuals when their data is transmitted isn’t exactly helping to spread the word. Their secrecy works against the purpose of the whole exercise. Nice.
I wonder how much money going to the US Treasury is a result of double taxation?
Homelander’s major support for CBT comes from their perception that all the tax can be offset.
Someone ran the numbers on the revenue brought in through the new compliance programs. Most of the money was not from taxes owed but from penalties for not filing and/or excessive penalties on very small amounts owed as taxes.
Oh, I should have added that the revenue brought in via FATCA is far less than the cost of the program.
@ Japan T
The US provides no tax services oversees ,however , gets free tax information and revenues ,at little or no cost . Sorry ,but I don’t understand how they are losing money ?
The money loss is from the implementation and maintenance of FATCA. Costs a lot more than it is bringing in. Same with the so called amnesty programs. While they brought in revenue, if I recall, it was less than the program costs and what they did bring in was mostly penalties.
The point is, they don’t really seem to care about the cost benefit ratio.
The cost of the implementation and maintenance of FATCA is born by the foreign (i.e. non-US) financial institutions, their customers, and their governments. (In other words, you and I.) Not a big surprise the US government isn’t concerned about the cost; they aren’t the ones footing the bill.
However, they are concerned about what joining and implementing the CRS might cost them. That’s one of several reasons why they haven’t signed on.
Possibly because they don’t care about whether non-residents file or not.
@maz57
While the cost to the US for implementing FATCA is far less that the costs borne by other countries having to enforce it, the costs to the US treasury are still significant. Costs include paper, printing, transportation costs and $15. each for 87 cent muffins at meetings. Whatever the amount, it has been reported to be far greater than the revenue FATCA has brought in.
@ Japan T
“Costs include paper, printing, transportation costs and $15. each for 87 cent muffins at meetings. ”
Please,I would be very interested to know where that came from and ,of course, the price of those muffins.
If it costs so much for all that stationery ,that means only that it comes directly to you from the homeland.
The itemized costs are from experience. The cost of the paper is a reference to the huge amount of rules and regulations published in support of FATCA. The Government Printing Office doesn’t get it for free. The costs of the muffins are from memory of various government spending scandals. The exact numbers are not recalled and frankly, not important. The fact that the costs for implementing FATCA are greater than the revenue it generates are from various articles and reports, some of which have appeared here on IBS.
The bottom line is the cost benefit ratio of FATCA is not important. I doubt the USG, with its huge deficit, cares about the costs vs. benefits of CBT in general. Or that of any of their programs, for that matter.