With FATCA Flaherty and Harper seem to have thrown due process under the bus, too

 

I have posted below the text of an email that I sent to the opposition parties and the Canadian Civil Liberties Association yesterday. I think the contents and arguments are self-explanatory.

I would urge everyone to write their MPs about this issue. Pay attention to the reply you get, or whether you get a reply. No MP, and no political party, that doesn’t even understand the concept and importance of due process (not to mention failing to understanding concepts of national sovereignty and citizens’ privacy rights), deserves your vote in the next election, nor deserves to sit in our House of Commons. In my opinion at least.

I am writing to express my extreme concern at what I see is an unacceptable lack in the recently-announced FATCA agreement and Finance Canada proposed regulatory and legislative changes, for real due process or indeed “due diligence” (to borrow a phrase) on behalf the “reportable” account holders, who are Canadian citizens and residents and entitled to reasonable due process IN CANADA.

The agreement and draft regulatory/legislative changes are clear on what our financial institutions are “required” to do, are “not required” to do, and “may” do. That is not good enough in my opinion. There is no guidance on what they “may not” or “should not” do. Nor is there any requirement that all reportable account holders consistently be given reasonable notification BEFORE THE FACT that their accounts are about to be reported to a foreign government, the specific reasons why their accounts are deemed reportable, and an opportunity to contest those reasons, with appropriate documentation, in a reasonable time frame, if they believe the reasons are wrong or inappropriate.

These lacunae are unacceptable to me as a Canadian citizen who believes in due process not only before the law, but also before corporations and government bureaucracies in matters such as FATCA that have the potential to devastate an account holder’s finances and/or result in significant amounts of time and expense in litigation over wrongful actions.

There is a strong possibility, I would even suggest likelihood, that inappropriate reporting will take place, given that the wording of the agreement and the Finance Canada information for individuals on their website. I see in these documents NO evidence of an attempt being made to ensure that all FFIs are asking the same questions, following the same processes, or ensuring that their employees who are interpreting the indicia have a clear, correct and consistent understanding of what those indicia mean and how they will be applied. Nor any consistent and independent options for oversight of and, if necessary, challenges to the application of the indicia.

No Canadian can be extradited to another country on the basis of an extradition warrant under an extradition treaty, before there has been a court hearing in Canada at which (s)he and her/his lawyer have an opportunity to examine the basis for that warrant and challenge it in front of a judge under Canadian law. I am not suggesting there needs to be a court review of reportable accounts, but I am suggesting that CRA absolutely MUST provide some reasonable before-the-fact opportunity for the account holder to review the basis for reporting the account to a foreign government and to challenge this reporting IN CANADA if they can. I would not trust hundreds of financial institutions to be responsible for this on their own. That would only compound the problems of consistency, and would be inefficient and overly expensive to the institutions, relative to centralizing this process.

There are too many opportunities under the current agreement and proposals for mis-reporting of non-reportable accounts by error, by misunderstanding, or frankly even by deliberate malice from a bank clerk who has a personal grudge or prejudice. And the procedure needn’t be expensive or onerous for CRA. Most financial accounts have email addresses attached to them. Presumably accounts are being reported electronically, in some format that CRA can easily search and from which it could reasonably easily produce robo-emails to the email addresses of the holders, indicating a) your account X has been reported to us, b) for Y reasons, c) we will forward this to IRS on Z date unless you reply to this email before then giving us an explanation and appropriate documentation to contest those reasons.

Please do all that you can to ensure there will be due process and due diligence to protect my fellow Canadians, in Canada, as well as whatever concerns you might have for the interests of the IRS and the financial institutions. Government and corporations exist to serve the people and respect their rights, not the converse (at least not in a truly sovereign and democratic country).

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About schubert

I've had a CLN (Certificate of Loss of Nationality of the United States) since 1976, quite by accident (DOS mailed me one after I wrote a long anti-US letter to Henry Kissinger on July 4, 1976, telling him I'd become a Canadian citizen several months earlier and why, then confirming on a form I got in the mail that I had done so willingly - duh! - and with the intent of relinquishing my US citizenship). I filed the CLN away and forgot about it until August 2011 when I first heard about FATCA and FBAR and realized I needed to find the proof I am not an American in spite of my birthplace. My wife, who came to Canada with her ex before I did and also became a Canadian citizen, believed she'd thereby lost her US citizenship but didn't write Kissinger, didn't know anything about CLNs or the need to get one (nor did I at the time), and applied for a relinquishment CLN a few months ago. Until August 29, 2012, we were waiting to get her CLN, and it has been in her interests that I'm monitoring and occasionally participating in this and the IBS website. However, joy of joys, wonder of wonders, my wife's CLN arrived in the mail on that date, so now we both have CLNs. I will continue to monitor and contribute to this website as I have time and when I think I have something constructive to add, but after 12 months of Hell we're going to get our sanity and lives back, and that means a prolonged vacation from anything related to CLNs, IRS, FATCA, or any other such crap, unless it rears its head and threatens Canada and Canadians to the point where I have to come out of my corner fighting again ...

4 thoughts on “With FATCA Flaherty and Harper seem to have thrown due process under the bus, too

  1. Blaze

    Thanks for sharing that Schubert. Excellent points as usual.

    @Just Me: Harry Truman was known for his common sense. His mother said

    “Harry got his common sense on the farm. He didn’t get it in town.”

    Unfortunately, American common sense died with Harry Truman.

    Perhaps Harry said it best when he said:

    My choice early in life was either to be a piano-player in a whorehouse or a politician. And to tell the truth there’s hardly any difference.

    Reply
  2. Just Me

    @schubert

    Excellent letter, and very reasonable and logical suggestions. Is anyone listening in the Canadian Government?

    Thanks for sharing in this post, and it could be the basis of a modified carbon copy of letters we could send to NZ ministers down here too.

    Sadly, most Progressives in America have forgotten ‘due process’, unless it it about NSA spying, and then they get worked up. But, if the IRS doesn’t have any because of the FATCA roundup of ALL, and if is because their favorite politician launched it on the back of Tax Dodger language, then their minds go on auto pilot and like auto reporting, and it is deemed ok and necessary. I hate to be so cynical, but I am totally disgusted at what Ideological fever has gotten us into yet again..

    On the other side we had the same issue with NeoCons and “liberty and Democracy” excuses for pre-emptive war.. They did everything they could to circumvent “due process’ so they could invade at their pleasure, and the dimwits in Congress and the media went along.

    Sometimes I despair that there is any hope for common sense due process left in America, or anywhere else in the world, for that matter.

    It is essential for a civil and democratic society. Without it, we are headed somewhere else that is NOT pretty!

    Reply

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