http://www.banktech.com/hey-regulators-how-about-more-carrot-and-less-stick–/a/d-id/1297320

UPDATE:  The original article was mysteriously removed today so the link above no longer works.  George, however, located a copy via Google Cache and it is available here for now.  A .pdf text version is also available here.

UPDATE #2 – mystery of the disappearance of original article solved — “there was a problem”.  Lucky for us — George found a copy via Google Cache (see above):

From: Katherine Burger
Sent: Friday, July 18, 2014 8:36 AM
To: caroltapanila
Subject: RE: Article July 16, 2014

Dear Carol – thank you for the note and feedback. However, the article no longer is available – there was a problem and we had to pull it from the site. However, Fred Cook is one of our regular contributors so hopefully there will be new content from him soon.

Kathy

 

Kathy Burger

Editorial Director

Insurance & Technology

Bank Systems & Technology

UBM Tech

O: 212-600-3062 I E: katherine.burger@ubm.com

 

From: caroltapanila
Sent: Wednesday, July 16, 2014 6:35 PM
To: Katherine Burger
Subject: Article July 16, 2014

 

Ms. Burger,
Information Week’s Bank Systems and Technology journal had online briefly this morning a very good, very honest article on the Foreign Bank Account Tax Compliance Act (FATCA) by Fred Cook. The title was:
“Hey, Regulators: How About More Carrot & Less Stick?”

Can I get a copy of that article or can you let me know how I can get in contact with the author, Fred Cook?

 

 

Thanks very much for your assistance in obtaining a copy of the above article.

 

 

Carol Tapanila

Calgary, AB, Canada

*****

Looks like the financial industry is finally realizing that FATCA is no one night stand but rather a shotgun wedding from hell – and the honeymoon is over.

We hear a lot about how the FATCA compliance industry is gleefully raking-in wheelbarrows full of consulting fees to design and commission new data management systems for banks and other financial institutions, but rarely have we heard from those on the inside who have to manage a growing plethora of complex and costly compliance programs.  A scant couple of weeks after FATCA’s inauguration, there are already signs of “FATCA fatigue” setting-in and, perhaps, a belated realization that something is just not ethically or legally right about FATCA.

Here are excerpts from an article by Fred Cook in Information Week’s Bank Systems and Technology journal:

Hey, Regulators: How About More Carrot & Less Stick?

For banks to afford the resources needed to handle today’s regulatory demands, it may be time to discuss changes in compliance enforcement with the regulators.

I do appreciate the need to provide information related to potential criminal activity for the benefit of society at large, but the recent Foreign Account Tax Compliance Act (FATCA) still has me shaking my head. This new regulation requires institutions to report taxable information on US citizens (living in Canada) via the Canadian Revenue Agency (CRA) to the US government. This means that, when we open accounts in Canada, we’re now required to collect customers’ citizenship details. We also have to ascertain the citizenship of all our current clients, even though citizenship is not a requirement for opening or servicing a financial account. We are also required to report, through the CRA, details of any US citizen living in Canada with account balances of more [than] $50,000. Ironically, until now asking for personal information such as citizenship was in direct violation of Canada’s privacy laws.

How is implementing the overhead of FATCA regulations a benefit to the institution’s business? Is it not just doing the US Internal Revenue Service’s work for it? I would make the same case for tracking deposits larger than $10,000, reporting suspicious transactions, or determining politically exposed people and providing details about them to government and police agencies — for free. Though managing these “offloading” regulatory requirements doesn’t have any direct benefit to managing the bank’s core business, they must be followed to stay in business under threat of substantial fines and criminal charges.

These government and policing agencies have zeroed in on the fact that banking is a necessity, and that the institutions providing these banking services have access to very personal information otherwise not readily available on consumers and their monetary habits. Therefore, my expectation is that our regulations will continue to expand while new ones are added.

Not quite exactly but pretty close.

Reluctantly, Patriot Flees Homeland for Greener Tax Pastures

Heather Bresch grew up around politics. Her father is Joe Manchin, the Democratic senator from West Virginia and a former governor. She has heard him say repeatedly, “We live in the greatest country on Earth,” as he did in countless political advertisements. And it appeared to rub off on her: Ms. Bresch was named a “Patriot of the Year” in 2011 by Esquire magazine for helping to push through the F.D.A. Safety Innovation Act.

But on Monday, Ms. Bresch announced plans to renounce her company’s United States citizenship and instead become a company incorporated in the Netherlands, where the tax rates are lower. She did so by agreeing to acquire Abbott Laboratories’ European generic drug business.

The following discussion is taking place this morning, starting here: https://isaacbrocksociety.ca/2014/06/01/its-time/comment-page-30/#comment-2235706

Deckard also highlights this offline:

Ottawa prepares to share personal data with foreign governments

While this article focuses on immigration, it’s a perfect opportunity to bring in the FATCA IGA again.

An excerpt:

Cabinet will also now be permitted to allow the “disclosure of information to verify the citizenship status or identity of any person” to enforce any Canadian law “or law of another country.”

Continue reading →

Since it is now July, and hotter than a cat on a tinfoil hat, this story may make your temperature rise:

http://www.inquisitr.com/1344871/will-july-be-the-month-the-u-s-dollar-collapses-imf-announces-possibility-through-creepy-message/

We’ll have an update on July – never mind, just watch the video.

http://www.lexology.com/library/detail.aspx?g=d35c2f66-5a6d-4612-8a44-a5b507a755d3

Implementation of the FATCA Treaty

The Dutch Ministry of Finance has launched a consultation on a decree implementing the FATCA Treaty. The decree requires Dutch financial institutions to provide information about bank accounts of US tax subjects, and to report financial institutions that do not comply with their FATCA obligations.

The Netherlands and the United States entered into a treaty on the implementation of the FATCA Treaty in December 2013. A bill providing for the ratification of the treaty will be submitted to parliament shortly.

Perhaps someone from the Dutch government should have a little chat with Allison Christians.

The excellent interview by All In A Day’s host Alan Neal with Allison Christians and Kathleen:

Comments on this excellent article here and there at Isaac Brock, so will heed “JC” request to post:

The Canadian-US tax treaty covers all aspects of taxation between the two countries. The current treaty cedes Canadian sovereignty to the U.S. and permission to double tax by not specifying exemptions such as for retirement accounts, the family home, life insurance, mutual funds, outrageous noncompliance penalties for Canadian tax residents, etc.

Everyone: there is a highly relevant new article here in regards to the injustice that has not had sufficient attention on this website: WSJ, David Kuenzi: American Expats Tax Nghtmare.

Or, if you have cannot access, the article is here

Another reference to the WSJ Kuenzi article: The Tax Treatment of U.S. Citizens Abroad Is Absurd and Unfair, and Getting Worse By Veronique de Rugy

*************
Note: David Kuenzi, Certified Financial Planner,® Founder, Thun Financial Advisors, Madison, WI spoke at the May 2, 2014 Toronto Forum Debate on CBT vs RBT (we’re still awaiting an ACA video of this forum).

http://www.islandsun.com/inter-governmental-agreement-simplifies-fatcas-compliance-premier-says/

Well, you don’t get much bigger than the entire universe:

“The signing of the FATCA IGA is universal… Also, contrary to what others claim, this is not about selling out anything,” Premier Dr. the Hon. D. Orlando Smith announced during a press briefing on 8 July. The BVI Leader made the comment as he announced that Government signed a Model 1B intergovernmental agreement (IGA) in relation to the United States (US) Foreign Account Tax Compliance Act (FATCA) on June 30.

Dr. Smith explained that FATCA is a United States federal law that is universal, and requires United States persons living outside the United States to report, among other things, their income to the US Government.

The BVI Leader further defended the decision to sign on to FATCA by stating: “I said this before and I will say it again, we are doing merely what a responsible government should do:  one, alleviate the burden on its citizens to comply with this universal law; and two, protect our financial services industry by helping the financial institutions to comply with this obligation.”

We’ve been saying for some time that the IRS seeks to tax US Persons no matter where in the universe they live.  This appears to be the first time that a government official anywhere on this insignificant planet has confirmed this fact on-the-record.