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.
Having grown up in Montreal, I had an account at Bank Of Montreal, simple savings. When I moved to the US (as a minor, nearly 18 of age) closed the account.
Opened another account in the early 1990’s with BMO downtown Montreal, and it was opened for a little over 12 – 13 years. With clearly Canadian, and only Canadian Indica, the account was fine but there were questions regarding the IP # of the computer I logged in from to the BMO website to check my account.
Fast forward to circa 2002 or 2003, on an attempt to log in, was given an indication that the account was closed, and they took and kept some dollars! Outrageous. Called and then went into the branch in Montreal personally to inquire and object, and ask for the remaining balance. No clear explanation was given, the balance was nowhere near the $10,000 USD threshold and they kept the $$$ ! ! !
This is my deposition of the experience with BMO ! Hope it enlightens other’s to their business practices, as I am a Canadian Citizen, and this occurred well prior to FATCA with that Bank. The amount is minimal, and litigation would be gratifying but not cost effective. However, am considering applying to Law School, and will state this, upon completion, the Bank Of Montreal would be on my radar !
Stephen Arvay
Several us here have told that this would likely happen to at least some if not all who had US indicia. We were not teated very kindly for our warnings.
Sadly, we were correct. Too late though now for 900,000 or so who have been reported.
Looks like the situation in Canada is not so different from the situation in Japan after all.
@pacifica777
Thanks so much for making a separate thread out of my original post. I, too, think this information needs to be spread widely and I appreciate you taking the time to promote it.
I was even more jaded than Japan T– I figured the banks would just send ALL accounts, US or not, just to avoid sifting through them at all….
Then again, we all know FATCA was never about taxes and ALL about a data/privacy/autonomy grab by the USA gov’t.
One clear lesson here is do not ever declare US citizenship to a Canadian bank. Obviously.
I would think that if BMO or any other bank reported an account with US indicia on file but did so without confirming that the customer was a US person – for example, a Canadian who spent a few years studying in the US, maintained a Canadian bank account with a US mailing address, then returned to Canada – then there would surely be grounds for legal action.
I am sure there would be, but one would have to pay for it and that would be after the fact that they had lost control of their financial data. No putting that genie back in the bottle.
Interesting. We opened, via BMO’s NYC representative office, a business account for our then-new Canadian corporation. The branch selected was in Montreal. The business was active and profitable in the 1970s and 1980s selling by mail order throughout Canada but when its U.S. sister company shut down in the early 1980s it did little business other than to centralise family property management for real estate outside Canada. In 2019 its charter was changed to an English charter. All U.S. persons were removed as shareholders and directors: only those who had renounced remain. Nobody at BMO ever asked about citizenship. Or taxes. When we applied in person a few years ago for Web access to the account a European passport and provincial driver licence were shown. The only IGA indicium of U.S. Personhood would have been the U.S. area code on the Vonage telephone number attached to the account, a number that rings in Europe. BMO never noticed. Certainly not when we closed the account and they sent us a bankers draft for the balance. We also cancelled our provincial driver license, renewed mainly as a souvenir since we got it in 1970 (in those days no immigration criteria were asked for, not for licences, not for Social Insurance numbers). We closed our Canadian post office box and forwarding service. End of an era.
BTW in recent years at least — absolutely since the 6-year FBAR statute of limitations — we have included the account’ small (<$5,000) balance in the FBAR of any connected U.S. Person.
RefugeeFromAmerica and EmBee,
Thanks for the correction comments, now deleted as they’re done.
Special thanks, RefuigeeFromAmerica, for doing this and sharing what you’ve learneed.
FWIW, Former US Ambassador Jacobson now runs BMO’s US operations(called BMO Harris Bank for “Homelander Americans”) based in Chicago.
https://www.bmo.com/home/about/banking/corporate-information/executive-bios/david-jacobson
Also I noticed there has not yet been a post about the EU FATCA hearing yesterday in Brussels. There was a EBA(European Bankers Association) representative their who was rather less than helpful.
It’s amazing front line people at the banks know so little about FATCA. Even more concerning is the hostility they were met with when calling the bank’s corporate office for more information. It’s encouraging that the hostility was not transferred to the customer – yet.
@pacifica777
It’s no problem as I’m always glad to help the cause any way I can.
@ Tim Smyth
BB and I posted the links to the hearing and the press conference over at “Media and Blog Articles” but this was such a hard won battle to get this attention by the EU parliament that I too think it deserves a post on Brock. Totally agree about that bank representative.
“ It’s amazing front line people at the banks know so little about FATCA.”
I keep saying that nobody knows about any of this.
Jane,
Not so much more Jaded than I. I would not be surprised if some FIs do just that. I am certain that many FIs in Japan will and are just turning over all data they have on all accounts held by people with nonJapanese family names. Very easy to find but very time consuming to sort out US persons from them.
when dealing with any institution asking the citizenship question just repeat this famous brock members quote…
i forget who exactly that was however
“that’s a racist question, are CANADIAN CITIZENS born elsewhere less CANADIAN? i do not answer racist questions”
and go onto the next question
Although I agree it would be fun to go the racist question route at least once just for sport, my favorite answer is “NO”, because it stops that obnoxious line of questioning dead in its tracks with no further discussion. What are they going to do? Argue with you?
During my last couple of account openings I was asked by low-level personnel who seemed embarrassed they even had to ask such an obviously un-Canadian question and were genuinely relieved when I answered with an emphatic “no” so they could tick the box and move on to something useful. “No” is lot less work for them and they couldn’t care less whether you are being truthful or not. They’ve done their job, gone through the motions, and if they happen to miss a few “US taxable persons”, who cares? They may not know much about FATCA but they certainly know US bullshit when they see it. Let the IRS do its own detective work.
In the past year I was asked by a bank clerk, “Do you pay taxes to any other country?” No is such an easy answer. I like easy. No was my one word response.
A faintly bored, emotionless “no” is never challenged.
The question may vary, but the answer is the same.
Wasn’t it Staples that had the red “easy” button ad a while back? Maybe the banks should get themselves a similar big red “no” button that they can push across the desk when they ask the question. I like easy, too.
“Do you pay taxes to any other country?”
Now that Canada has signed on to the CRS its possible that this has become the new standard question. I hope so because this is actually an excellent way to ask it.
That’s because there’s no specific mention of the US, no mention of birthplace, and no obnoxious intrusiveness. By asking “the question” in those terms, even if (according to the IRS, anyway) you should be filing US returns, if you don’t file them you can reply with a simple “no” and be totally truthful.
@maz57
Yes, it’s delightful when they avoid the direct citizenship question. We’ve also seen the CRS formula “Are you tax resident in another country?” This I like because a person who knew themselves to have US citizenship might not be aware of CBT and its obligations and would answer “no” with a clear conscience.
The RC518 form from Revenue Canada and used by BMO, and presumably all Canadian banks, asks for certification of tax residencies.
https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/rc518/rc518-18e.pdf
Namely it has a separate checkbox in Section 2 for:
“I am a tax resident or a citizen of the United States.”
This is in addition to other checkboxes for Canada and places other than Canada and the United States. The USA still gets special placement and differentiation from all other countries…on a Canadian government form…disgusting violation of our sovereignty.
Some banks use the CRA form linked to above, some banks use their own very similar form. Now that CRS is in force I expect none of them use the US W8/W9 forms for FATCA purposes, but rather a form that covers both.
The important thing is not so much the form or the exact wording of the question, but the fact that the bank accepts one’s answer unchallenged.
To Grace X who is foiling FBARs for an account on ~$5K. The FBAR requirement applies only if the aggregate exceeds $10,000 at any time during the year. The 10K number refers to US residents; I believe it it 50K for US persons residing outside the US, but am not 100% sure.
Everyone else, it may be easier to start afresh with a new bank. Of course, this doesn’t help is EVERYONE’s account is being reported.