FATCA: A Simple Premise Gone Terribly Wrong

Here is FATCA:  A “Simple Premise” Gone Terribly Wrong

This was coauthored by Lynne Swanson (aka Blaze) in London, Canada and the hillVictoria Ferauge (aka Victoria) in Versailles France and was published today in The Hill Congress blog.

In the article, we ask

President Obama and members of Congress, how did the “simple premise” of “cracking down on illegal tax evasion and closing loopholes” become an attack on financial lives and personal integrity of millions of people living outside United States, their banks and laws and constitutions of their countries of residence?

Is this how “common sense measures” will “restore fairness and balance in the tax code?”

In reporting on how complex, costly and convoluted FATCA has become Victoria and I also ask:
Mr. President and Members of Congress, is this what you intended?




35 thoughts on “FATCA: A Simple Premise Gone Terribly Wrong

  1. Blaze Post author

    For those who may not know what AtticusinCanada is referring to when she mentions Carl Levin’s remarks, here is a letter he wrote in January, 2012.


    This was posted at Brock just after Simple Premise appeared in The Hill. It gives us a clue as to how FATCA morphed from a “simple premise” to the nightmare we have been living. (Arcticgreyling, if your anger “was getting the better” of you before, I suspect this will make you ballistic)

    On the first page, Senator Levin (who Obama lauded for his efforts on FATCA) says:

    “These comments seek to encourage the development of guidance that will assist foreign financial institutions in meeting their legal obli-gations, while facilitating law enforcement’s use of foreign account information to combat tax evasion, money laundering, and other misconduct.”


    “This letter also urges treating FATCA off-shore account information as non-tax return information to ensure its accessibility to law enforcement and national security communities combating crimes other than tax evasion.”

    After several pages of very concerning suggestions for FATCA, on the last page, Levin writes:

    “Although FATCA is structured to address offshore tax abuse, offshore account information has sig-nificance far beyond the tax context, affecting cases involving money laundering, drug trafficking, terrorist financing, acts of corruption, financial fraud, and many other legal violations and crimes. Given the importance of offshore account disclosures, FATCA guidance and implementing rule should create account FATCA forms that are not designated as tax return information but, like FBARs, may be provided to law enforcement, regulatory, and national security communities upon request.”

    I e-mailed a copy of this letter to Kevin Shoom and Jim Flaherty.

  2. AtticusinCanada

    I absolutely do NOT support tax havens. This is where we get our message messed up by Americans who think FATCA is about tax havens. Maybe it started out that way but, it has morphed into what it is now. Remember when Canada asked for an exemption because “we’re not a tax haven”

    The U.S. is using FATCA to collect enormous amounts of banking data all over the world. It’s doing this in high tax countries on individuals who never would owe a dime to the U.S. That wasn’t a mistake. It was a feature. That’s why they wouldn’t exempt high tax countries. It’s an opportunity for the U.S. to monitor and control persons and banking all over the world. As evidenced by Carl Levin’s remarks some of FATCA is indeed NOT about taxes.

    I fully agree that large corporations should have been paying taxes. Such as G.E. who got a refund when they should have paid in. This is not about that. Too bad many inside the U.S. don’t know it. The U.S. government thinks no one inside the U.S. will listen to us and their press usually still keeps pushing their “tax haven” message/propaganda.

    1. ArcticGrayling

      @ Atticus………

      Then basically you are advocating unlimited power to the Public Class. They are helping themselves to a disproportionate portion of the pie. It’s bad enough here. It’s worse in the States.

      Actually, in Canada, we do have access to tax havens. All we have to do is leave, which Canadians are free to do, and which any of us in here will be free to do once we have the CLN. To that extent, Canada’s public class does face competition from tax havens, and that is not, in my judgement, a bad thing. Competition is a good thing. Governments should face competition too. As a practical matter, most of us stay here.

      The fact that most Canadians choose to stay and pay taxes here is testimony to the quality of life our country offers. To be sure, people like the Irving family took their personal wealth elsewhere, but the businesses they left behind pay taxes here. Also, for them to remit from their Canadian holdings to their accounts in Bermuda, they must pay a withholding tax. It’s only what they manage to invest from Bermuda that is sheltered from tax. As a practical matter, even that is limited, because most of their investments would be in jurisdictions where withholding taxes would be paid on their income.

      So I think the “tax effect” of tax havens is overblown.

      The real benefit of offshore havens is legal protection against non-tax related legal judgements. In a highly litigious environment like the States, many high-earning professionals will protect their money from judgements resulting from frivolous law suits. Frivolous law suits abound in the United States. It’s not nearly as bad here.

  3. Blaze

    @ArcticGreyling: There are those who believe what FATCA is really about is putting all the other tax havens out of business so they have the field all to themselves.

    Even with that, I don’t think most of us support the idea of tax havens anywhere where people stash money to avoid paying taxes.

  4. Blaze

    This article does not specifically mention the Simple Premise article. It did, however, take some of the information from our article.


    In fact, the Simple Premise article may be what awakened the author to the “ridiculousness” of FATCA. It seems she has just become aware of the “US person” rule

    She reports, as did we, that the King of Thailand, Mayor of London England and Premier of New Brunswick are all “US persons”

    She also lists several of the facts included in our article.

    I agree with most of what she wrote. However, these statements give me grave cause for concern: “Before all the FATCA nonsense takes full hold in 2015, think about researching some safe-havens. Look at globalizing your assets in various stores of wealth.”

    That is exactly what got us into this mess. We have been caught up in the mess of residents in US who are trying to evade taxes. We are not doing that. We pay taxes where we live, work, and earn an income. I have posted a comment on her blog. It is awaiting moderation.

    1. ArcticGrayling

      @ Blaze……

      I think the Public Class in the United States could use a little competition from “tax havens”. I suggest you read Mark Steyn’s book “After America”.

      On average, Public Sector remuneration in the United States is significantly higher than in the private sector. Not only that, they get pensions that most private sector workers can only dream about.

  5. atticusincanada

    @articgrayling, you won’t get any argument from me about Obama. I wasn’t fooled by him and perhaps disliked him early on for different reasons. Among them my lunch with a certain Alice Palmer who filled me in on his “actions” on the south side. She got him into politics there and she and her husband for over thirty years were the REAL “community organizers” there and are well known. In return for her help, he ruined her career and then took credit for being the true “community organizer” which was NOT his work. That told me all I needed to know very early on. All of this was ignored by his cheerleaders in my former party. *washes hands* I’m just DONE with them.

    They have the same view with FATCA, they cheerlead it on one hand all while saying they are against being spied on without a warrant by the NSA. All while feeling the U.S. is going way too far collecting THEIR data and being totally full of it by buying propaganda on FATCA while really knowing nothing about it at all. Done, done and done.

    My efforts are trying to get the Canadian government to say “NO!” and then to further not allow our banks to go along with FATCA without a fight here. The Americans are lost. Both sides are an echo chamber of hubris and misinformation there. The fight has become about fighting and not about facts even in the most enlightened circles.

    FATCA though is so poorly thought out and so poorly written that it might just crash under its own stupidity. Like you, I’ve been turned into someone who feels that the U.S. can take its little blue passport and stick it where the sun doesn’t shine. Make a law that ma harms me… I won’t like it but, do the same to my non American family and I’m done.

    May this article be the first in a long line. Cheers *raises glass* to both Lynne and Victoria.

  6. ArcticGrayling

    @ abusedexpat…………..

    Yes…..the articles are good, but I won’t feel good until somebody pressures those clowns in Washington to back off. Our only hope is that our government will stand its ground. Maybe if Canada takes some leadership, others will follow. Maybe some who have signed will change their minds too.

    The articles from all the sources (not just Blaze’s article), actually, are well written and well thought out. But I don’t expect any more wisdom from the Washington class than I would from an ordinary street punk. When a street punk is trying to mug you and gunpoint, which Warlord Obama is basically doing, they generally are not too receptive to calm and articulate reason. They generally don’t have a very clear idea of what it takes to create sustainable wealth.

    Obama only knows how to feed at the tax trough. With his Administration borrowing or printing 4 out of every 10 dollars it spends, he really has no clue on what it takes to keep the trough full.

    I liked that article from the fellow in Thailand. He makes a point about all the illegals from Mexico who are banking in the States. Has Mexico demanded that American banks give reciprocity for all the Mexicans in the States. Are they going to report to the Mexican government? American banks obviously would not like the idea.

    Has Mexico asked them? Does anybody know?

    Honestly, the ignorance, arrogance, and self-centred view of the Americans amazes me more each day. They are the only country on earth (of any consequence) that taxes on the basis of citizenship. Their heads are stuck up their asses. They need a good laxative.

    Their body politic is made up of people who for the most part have never had a private sector job in their lives. They have no idea what it’s like to be responsible to shareholders for a bottom line. Warlord Obama is certainly among them. I don’t think he’s ever done anything of any consequence in the private sector.

    Mark Steyn writes about the mindset of the American Public Class in his book “After America”. I recommend it as good reading.

    1. ArcticGrayling

      @ Victoria……….

      I wonder what the King of Thailand is going to do about FATCA. He was born in the United States too.

      Do you think warlord Obama will send the Navy Seals after him if he doesn’t comply? If the IRS exempts the King and not us, we could bring a discrimination charge against the IRS.

  7. AtticusinCanada

    @ArticGrayling, the voter fraud went on the in the 2008 primary too. Two thousand reports were filed in Texas alone and a law suit was filed. I saw it myself when voters were literally locked out of caucuses, sign in sheets were manipulated and in some cases voters signed on to the sheets multiple times who did not even live in the district and on and on. A film about it was made called “We Will Not Be Silenced” yet not a peep while all this was going on. I won’t even get into what I saw going on at the convention which I did attend. It was disgraceful. And that’s when I first got a glimpse of the farce U.S. elections had become. I gave up on caring about their set up when I had a phone call with none other than Howard Dean who admitted to me “Some voters were left out of the process” It took me three months to get him on the phone but, I did it and they KNEW what they were doing. What a SCAM. Both their so called political parties are corrupt to the core.

    The article was stellar and I’m so glad both of you were able to get it published in “The Hill” I just glimpsed the conversation at DU today. They are SO ill informed! And then there’s the fact that they feel “exceptional” so no amount of facts will seep through. CBT is right to them because well….it just is, Go U.S.A. and they are blind to how backward this is and how contrary it is to everything else they profess to believe.

    I believe FATCA will die but, not before many are harmed by it. Later on we’ll be trotted out and examples of how bad it really is by the very people now saying it’s a wonderful thing to catch us “tax cheats” by then it will be too late for many. By then they’ll “understand” it all finally.

    I honestly don’t understand a single thing about the U.S. government or either side of their arguments. The right is off the hook and the so called left just bends their “ideals” whenever it suits them just like what I witnessed in the primary and just like those who are against the NSA spying are championing FATCA. It’s all okay as long as it isn’t happening to them. I’m starting to become extremely disgusted by most home land “U.S. persons” The most MYOPIC ill informed yet so self congratulatory people on the planet. A mere seven years ago I had a very different opinion of most home landers. I hope the U.S.A. goes to RBT and does it soon or else provides us with an easy way to become an ex citizen.

    1. ArcticGrayling

      @ …Atticusin……..

      yes…both parties are corrupt, but I think the Dems, going back to John Kennedy and Lyndon Johnson in 1960, are worse.

      I also think more people, including the media, have to get their minds around and overcome the idea of being reticent about directing vitriol at Obama. I notice that some still fear being accused of being “racist”. They say it’s the “system”.

      They are partly right, but Obama nevertheless sought the office of President, so he has to take all the baggage that comes with the job. He signed FATCA into law, and it doesn’t really matter whether he understood its implications at the time of not (I think he’s a tyrant by nature and understood very well what it meant). He is still responsible. As the man in charge, as the man with final signing authority on legislation, he is responsible.

      As the head of state of a country that is violating the sovereignty of Canada and many other countries, he is responsible.

      As the man who is presiding over an Administration that borrows or prints 4 of every $10 its spends, he is responsible.

      As the man who had Black Panthers chasing opposition party invigilators from voting booths, he is responsible.

      I will not treat with respect a Head of State whose country is violating the sovereignty of my country. I don’t care what colour he is.

  8. ArcticGrayling

    @ Whitekat…

    I don’t vote in a country where I don’t live……………but……..

    I am almost as angry at the majority of “US persons” in Canada who cast absentee ballots for Obama’s “hope and change” malarkey. That clown signed FATCA into law in 2010, presided over an Administration that came steam rolling in Canada in 2011 with all the FBAR blackmail, and yet the majority of these people voted for him again in 2012.

    They are sheeple. They voted for a president who is riding roughshod over our sovereignty and the sovereignty of many other countries too. The American media are his biggest cheerleaders, the Canadian media is silently compliant, and even the Nobel Committee even gave that monster a Nobel Peace Prize, which Committee also seems to have forgotten about FATCA and that more American troops died in the first 4 years of his Presidency than died in the entire 8 years of George Bush.

    Granted, Obama got the Nobel Prize before FATCA, but they should have the integrity to rescind it. Good grief, they even gave Al Gore a Nobel Prize for science fiction.

    Obama plays the race card, and the sheeple comply. Even most non-Americans in Canada would vote for that criminal too. The sheeple fear accusations of racism more than they cherish decency and common sense.

    So I think it is pointless to appeal to the American body politic. Our only hope is in our own lawmakers. Remember, Obama’s constituency within the United States, in lopsided numbers, consists of voters who are net recipients of government largesse, so I think you can bet you last dollar that Obama doesn’t give a rat’s ass about us. We are nothing more than another bank for that criminal to rob. He knows, from the results of the last 2 elections, that he already has the sheeple on this side of the border in his pocket anyway. His media hallelujah chorus saw to it.

    Furthermore, my locale in Canada has me come face to face with many Americans travelling through this country. When I tell them that I am renouncing American citizenship because I want to live in freedom, they are incredulous. When I patiently explain why, they are even more incredulous. Their ignorance is only matched by their arrogance.

    So as much as I admire the spirit of somebody like schubert, I think the reality is very different from what he wants it to be. I doubt that schubert’s contacts consist of Obama’s inner city voters. I don’t think Oprah would give him the time of day either. Our government in Canada is our only hope. They have to have the balls to call that monster’s bluff.


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