New FBAR Limits Reflecting IRS Concern on Eighth Amendment Litigation.  More poopourri:

(Spritz the bowl — before you go — and no one else will ever know that your FUBARs stink)

or, in the words of this BNA article “New constraints on penalties the IRS will impose when taxpayers don’t properly report their foreign bank accounts show agency concerns that some will argue in court that huge penalties are unconstitutional, attorneys told Bloomberg BNA.

IRS guidance limiting the penalties examiners can assert for failure to file the Report of Foreign Bank and Financial Accounts “reflects some awareness and sensitivity about the constitutional issue presented by a multi-year FBAR penalty,” ……..

“The notion that the government will exercise some administrative restraint is a good development.”

Let the litigations begin.

(sign up for the free trial to read the whole article)

http://www.bna.com/new-fbar-limits-n17179927429/?elq=4e5f8e82daa945c3a42c287a14e85623&elqCampaignId=882&elqaid=1571&elqat=1&elqTrackId=ef57973ec09040b1be7c66555ff36435

or shortlink

http://bit.ly/1MOU4kv

I was going to write about the monumentally hypocritical FATCA IGA signing ceremony yesterday at the Vatican, but the ever-pithy Sovereign Man (Simon Black) took the words right out of my mouth. I’ll let him have the floor instead:

June 11, 2015
Oxford, England

OK this is really getting ridiculous.

Despite being the sacred keepers of the Catholic faith and trustees of the meek, the Holy See has just inked a deal with the US government putting the Pope in bed with the Internal Revenue Service.

It’s so bizarre you couldn’t possibly make this stuff up anymore.

The Vatican City has been forced into sharing information with the US.

So now, like a good little doggy, they’re obliged to cough up financial records on anyone they’ve ever had dealings with whenever Mr. Obama snaps his fingers.

I’m not sure this is what Pope Francis had in mind when he called for an end of “the cult of money and the dictatorship of an economy”.

Ironically, the oft-quoted Book of Proverbs says that “[T]he borrower becomes the lender’s slave.”

And this is true in almost all cases. Except, apparently, when it pertains to the US government.

Despite having borrowed more money than any nation in the history of the world, the US government still acts like everyone’s master, including dictating the most ridiculous terms on financial agreements like this.

It’s all part of FATCA– the 2010 legislative joke formally known as the Foreign Account Tax Compliance Act.

We’ve talked about this before– FATCA may prove to be the greatest disaster in US history. And there’s one simple reason why.

Ever since the end of World War II, the US banking system has formed the backbone of global banking and finance.

Right now, if a South African refiner buys oil from a Brazilian producer, that transaction will likely be settled in US dollars and clear through the US banking system.

In other words, the money will flow from South Africa to New York, and from New York to Brazil.

It’s like this with most international trade transactions, particularly commodities contracts like coffee, oil, and metals.

For over 70 years now, the rest of the world has trusted that the US government would continue to allow free and unfettered access to a sound, safe, stable banking system.

And… one would think that the US government would respect this tremendous responsibility of overseeing the world’s core banking system. Yes. One would think.

But that hasn’t happened at all.

In 2008 after Lehman Brothers failed, suddenly the world got a dose of reality.

After an epic financial disaster which brought down some of the largest banks in the United States, suddenly the world realized that the US banking system wasn’t so safe after all.

One bank after another failed. Several had to be nationalized. Nearly all of them had to be bailed out.

Fool me once, shame on you.

Then in 2010, the US government passed FATCA… which mandated that every bank on the planet jump into bed with the IRS.

They further threatened that any bank which did not comply would be kicked out of the US banking system… essentially choking off a foreign banks’ ability to conduct international business.

Fool me twice, shame on me.

Then last year the US government went after French bank BNP Paribas, fining them a whopping $9 BILLION for doing business with countries like Iran and Cuba (though the latter is now curiously America’s BFF.)

And naturally, if BNP didn’t pay up, the US government threatened to kick them out of the US banking system. Notice a pattern?

Fool me thrice. OK how many f**king times does the world need to be fooled before they do something about it?

Too many times, apparently. But it’s finally starting to change.

The world has realized that the US government has a track record of reckless irresponsibility.

They’ve proven to the world that they’re willing to take the sacred international banking obligation that they’ve been entrusted with and turn it into a weapon of intimidation.

This is unbelievably stupid.

The US government is taking a giant, steaming dump on its last remaining competitive advantage.

Having control over the global financial system is for all intents and purposes a license to print money.

It meant that the US could create as much money as it wanted, indebt itself as much as it wanted, because there would always be strong foreign demand for dollars.

But you can only bully the rest of the world so many times before foreigners start looking for alternatives.

And that is happening.

The new China International Payment System (CIPS) will be the first credible option in conventional banking to circumvent the US. And it’s coming online later this year.

Not only is CIPS not dependent on the US dollar or the US banking system, but it also fixes a number of technological inefficiencies with the current system.

Over the long-term, the end result will be fewer banks using the US system, resulting in a substantial decline in their use of US dollars and their ownership of US government debt.

Think about it like this– foreigners currently own a third of US government debt.

If they no longer have as strong an incentive to own US dollars and start reducing their load, who’s going to pick up the slack?

Who will the US government turn to when they need to borrow money?

Simple. You.

Whether you want to or not, the US government will find the most creative ways possible to ensure that you invest your money in the ‘safety and security’ of government bonds.

Welcome to the coming capital controls.

Until tomorrow,

Simon Black
Founder, SovereignMan.com

This is one of the most bizarre stories I have seen in some time. In an odd sort of way, it is quite similar to the kind of treatment expat dual US/CDN citizens have experienced via the “FATCA Hunt” and the IGA. And similar to the accidentals/non-meaningfuls, this time, Canada is failing to protect one of it’s native-born sons. YogaGirl kindly shared this story . (all emphases below are mine).

This is not quite an example of C-24 because Paul Watson is still a citizen of Canada but by taking away his passport, he cannot enter. In a sense, taking away his passport is similar to taking away his citizenship. He cannot enter the country nor can he enjoy any of the rights and protections of the Charter.
 

“Without a Canadian passport I am not allowed to enter Canada because dual citizens may not enter the country with the passport of their alternative citizenship.”

 
No crime, no warrant. No trial. No justification. What sort of government does this resemble?
 

“I don’t have a Canadian passport.

Why?

Because Stephen Harper took it away from me.

Is it because I’m wanted for a crime in Canada or did I commit a crime in Canada?

No.

There is no Canadian warrant for me in Canada.

Stephen Harper took away my Canadian passport because Japan asked him to take it away.

Why?

Because we opposed illegal Japanese whaling in the Southern Ocean, a whaling operation that has been condemned as illegal by the International Court of Justice.

Stephen Harper decided that supporting illegal Japanese whaling was more important than defending the rights of one of his own citizens”.

 
Any Canadian who doubts the fact that Canada is becoming totalitarian under Harper is under serious delusions. PMSH isn’t even using C-24 or C-51 in the way those bills claim to operate yet a citizen is being stripped of his rights and protections. Conservatives will label Capt Watson as a “radical” or (ecological) “terrorist” which will prevent mainstream Canadians from recognizing the treacherous actions taken by the Canadian government. By presuming Capt Watson is “dangerous,” Canadians will not see the reality of what is happening, in the same way that Homelanders cannot see that we are not tax cheats or traitors. This will allow Harper to keep going down this road. Very dangerous territory.
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Perhaps someone should do a comparison of Bill C-51 and the Patriot Act? People should be looking carefully at how the two might be used cooperatively against citizens of both countries. It may be worth remembering how the border is being compromised (police of both countries operating on each others’ soil, with the Americans wanting to apply US law when in Canada) as well as the build-up of Canadian super-prisons even though crime is way down. Said not to incite fear but to face facts.How can one not be reminded of Naomi Wolf’s Blueprint for Shutting Down an Open Society?
 

“My position is quite simple.
In supporting and voting for Bill C-51 and making it law, both Stephen Harper and Justin Trudeau have betrayed all past generations of Canadians..

Bill C-51 makes the Patriot Act looks fascistically shallow by comparison….

C-51 has negated the Canadian Charter of Rights and Freedoms.

We now have freedom of speech until we open our mouth. Harper now has a right to revoke citizenship without explanation something that he already effectively did with me.”

 
Again, these words could have been written by any American who finds his/herself trying to come to terms with the fact that the U.S. is no longer the place they grew up in. I actually find it incredibly more sad, to hear a CANADIAN say exactly the same. I guess I am used to this behaviour by the U.S. but figured Canada had a long way to go before engaging, to the same extent, in the betrayal of it’s people as well as it’s founding principles.
 

“You see Harper can keep me as a Canadian out of Canada but he can’t take Canada away from me. I swam with beavers as a child. I’ve trudged in snow shows at 49 below in the Peace River Valley to protect wolves. I led eight campaigns to the ice floes to defend harp seals…..

In other words, I’m just as much a Canadian as that sanctimonious petro-ass kissing corrupt, scofflaw, smug, on-the-take, holier than thou, climate change denying embarrassment of a Prime Minister who needs to be kicked out of Ottawa on his dictatorial pseudo-Tory ass come October.

It’s not only time for a change it’s essential that there be a change and it’s time for us to return Canada to what we once were – a freedom loving, peace loving, beautifully wild nation – and what we need to be, a nation rich with First Nation heritage, true conservatives as in nature conservationists, instead of pseudo-conservative eco-terrorist right wing radicals, hell bent on selling the nation out to corporate marauders.”

 
Until Canadians start to fight back, Harper will continue destroying this incredible country. We have our hands rather full fighting the IGA and CBT but there is one simple way to support our fellow “freedom-fighter.”
 
Please help by signing this petition and sharing on FB, Twitter, etc. Time to start building a network in Canada. And don’t forget to vote ABC. More on this story.
 

From my wife @YanaRusinovich Watson. "Please Sign this Petition for my Husband Captain Paul Watson” Pls RT! https://t.co/UAVL7aEvow

— Captain Paul Watson (@CaptPaulWatson) May 9, 2015

 
Tweet and photo from this article
 
 

Tim found this article in German here which indicates that a court in Liechtenstein has issued a temporary injunction prohibiting the Liechtenstein Revenue Authority from transferring FATCA-related data to IRS before September 18th 2015 — prior to which the court will consider whether the US-Liechtenstein FATCA “IGA” is compatible with the Liechtenstein constitution. [See also article in Liechtensteiner Vaterland].

An English translation provided by my Austrian colleague:

Volksblatt.li Wednesday, June 10, 2015

Liechtenstein Constitutional Court grants FATCA claimants more time

“VADUZ – Two Liechtenstein financial market service providers, who brought a lawsuit against various provisions of the FATCA Law, can catch their breath. For the time being, they are given a few months more time. However, this is not a fundamental decision.

As a temporary injunction until a ruling has been handed down on their constitutional complaint, however until latest September 18, 2015, the Constitutional Court has forbidden information reported by the two claimants to the Liechtenstein Tax Authority by June 30, 2015 to be forwarded by the Tax Authority to US authorities and other agencies, particularly the IRS.

This was reported on Wednesday by the law office of Wolff, Gstöhl & Bruckschweiger in Vaduz. As attorney Karl Mumelter explained to “Volksblatt,” the grounds for the decision by the Constitutional Court were essentially that the claimants would incur a disproportionate and irreparable disadvantage if the information reported to the Liechtenstein Tax Authority were to be forwarded to US authorities before the Constitutional Court ruled on the claimants’ constitutional complaint.

Partial victory for the claimants

In February of this year the two Liechtenstein financial market service providers filed a constitutional complaint with the Liechtenstein Constitutional Court against the law of December 4, 2014 concerning implementation of the FATCA Agreement.

Their complaint seeks to have – in their opinion – unconstitutional provisions of the FATCA Law repealed. In their complaint the claimants contend that the FATCALaw contains unconstitutional references to US Tax Law, is not litigable because of its complexity, and subjects the financial market service providers to disproportionate and unforeseeable costs.

At the end of May 2015 the two claimants filed with the Constitutional Court a supplementary motion for Grant of Temporary Injunction in this matter. The decision handed down by the Constitutional Court on June 9, 2015 grants this motion. The Constitutional Court granted the temporary injunction until September 18, 2015.

As Karl Mumelter further stated, the Constitutional Court feels that the temporary nature of the relief sought ensures, on the one hand, that no disproportionate disadvantages are incurred by the claimants and that the constitutional complaint is not ultimately robbed of its effect and, on the other hand, that the public interest in swift and efficient implementation of the FATCA Agreement is upheld. “It appears the Constitutional Court will conclude the matter of the constitutional complaint by September 2015,” said Mumelter.”

Although the actual claims in this Liechtenstein lawsuit, not explicitly disclosed in the article, might/probably differ from those in the Canadian Federal Court case, this would seem to be a “first” for any court action against implementation of a FATCA IGA — in any country.

[You can go to the German article and comment via Facebook.]

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Can the United States be justified in imposing, without informed consent, U.S. citizenship on a group of persons, especially “never-meaningfuls”, who do not want U.S. citizenship?

Here below are a few quotes from a June 5, 2015 United States D.C Court of Appeal ruling, on the question of citizenship status of residents of American Samoa, that bear somewhat on this question.

[Back in August 2014, Eric discussed this lawsuit, recently ruled on in D.C. Court of Appeals. As Eric comments below, there is a focus in the ruling on “collective” consent which sidesteps the issue — but this does raise the question whether it could ever be feasible for U.S. people overseas (perhaps beginning with those in Canada for example) to express, and insist on, their self-determination and rights through their own collective association — that need not be part of any U.S. political process. Probably not practical, but are we not a “people”?]

A FEW QUOTES FROM THE RULING:

“BROWN (Senior Circuit Judge): In our constitutional republic, Justice Brandeis observed, the title of citizen is superior to the title of President. Thus, the questions “[w]ho is the citizen[?]” and “what is the meaning of the term?” Aristotle, Politics bk. 3, reprinted in part in READINGS IN POLITICAL PHILOSOPHY 55, 61 (Francis W. Coker ed., 1938), are no less than the questions of “who constitutes the sovereign state?” and “what is the meaning of statehood as an association?”

“We can envision little that is more anomalous, under modern standards, than the forcible imposition of citizenship against the majoritarian will.”

“We hold it anomalous to impose citizenship over the objections of the American Samoan people themselves, as expressed through their democratically elected representatives.”

“A republic of people “is not every group of men, associated in any manner,[it] is the coming together of . . . men who are united by common agreement . . .” [MARCUS TULLIUS CICERO]”

“See, e.g., U.N. Charter arts. 1,73 (recognizing self-determination of people as a guiding principle and obliging members to “take due account of the political aspirations of the peoples” inhabiting non-self-governing territories under a member’s responsibility); Atlantic Charter, U.S.-U.K., Aug. 14, 1941 (endorsing“respect [for] the right of all peoples to choose the form of government under which they will live”); Woodrow Wilson,President, United States, Fourteen Points, Address to JointSession of Congress (Jan. 8, 1918) (“[I]n determining all []questions of sovereignty the interests of the populations concerned must have equal weight with the equitable claims of the government whose title is to be determined.”)”

“In this manner, we distinguish a republican association from the autocratic subjugation of free people. And from this, it is consequently understood that democratic “governments . . . deriv[e] their [] powers from the consent of the governed,”

“Citizenship is the effect of [a] compact[;] . . . [it] is a political tie.”
[Talbot v. Jansen]”

“The fabric of American empire ought to rest on the solid basis of the consent of the People.”

— Also, some thoughts on citizenship from an anonymous commenter on Townsend’s Federal Tax Crimes blog: “…If you’re a Canadian citizen under Canadian laws what difference does it make that some foreign laws classify you as a citizen of that foreign country? The boundary of the U.S.A. is the boundary of the U.S.A. Just say NO and stay in Canada. Why should you visit a foreign country’s diplomatic mission and pay a fee to renounce a citizenship that foreign country unilaterally inflicted upon you? Just say NO.”

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The Officiant asked:
Petros, will you take [future Mrs. Petros] to be your wife?
Will you love her, comfort her, honour and protect her,
and, forsaking all others,
be faithful to her as long as you both shall live?

Petros answered:

I will. …

I, Petros, take you, [future Mrs. Petros],
to be my wife, to have and to hold
from this day foward;
for better, for worse,
for richer, for poorer,
in sickness and in health,
to love, cherish, and worship,
till death us do part,
according to God’s holy law;
and this is my solemn vow.

I relinquished my US citizenship on February 28, 2011. But in my heart, I really relinquished my US citizenship over 20 years earlier in a Vancouver church. The United States requires ultimate allegiance and total loyalty. It is not willing to take second place. But I was unfaithful to this birth obligation and aspired to another calling, that of husband. So I took this solemn pledge and agreed to forsake all others and to marry my wife.

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