CANADIAN FATCA IGA LITIGATION: We need IRS NON-COMPLIANT Canadian Witnesses with FATCA REPORTABLE ACCOUNTS > $US 50,000

WE NEED MORE WITNESSES WILLING TO FILE AFFIDAVITS IN OUR CANADIAN FATCA IGA LAWSUIT:
U.S.-born Canadian citizens, your bank knows that you were born in the U.S. because you provided this information, never IRS compliant, no meaningful history with U.S. except by birth in U.S., never U.S voting, never U.S. passport, never relinquished, but you must have a FATCA reportable account >U.S.$ 50,000
Reportable accounts can be, for example, non-registered investment accounts — but CANNOT be RRSP, RESP, RDSP, TFSA etc. registered accounts. We also seek witnesses who have accounts less than $50,000 U.S. but who know or suspect e.g. from a bank FATCA letter that their account info has inappropriately been turned over to CRA/IRS. You will describe your harm in a written affidavit which will be made public. If interested contact stephen.kish.chair@adcs-adsc.ca See our website at www.adcs-adsc-ca
Continue reading CANADIAN FATCA IGA LITIGATION: We need IRS NON-COMPLIANT Canadian Witnesses with FATCA REPORTABLE ACCOUNTS > $US 50,000

Letter to Minister of Revenue Regarding IRS Delay in Account Reporting

 
cross-posted from the ADCSovereignty Blog
 
ADCS_ReqMinFind_b_SEP_21_2015 (1)
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In our September 18 ADCS blog post we advised you that, for whatever reason, the United States Department of Treasury will now permit a one year extension, to September 30, 2016, to turn over private bank account information to the U.S. Internal Revenue Service, to comply with the U.S. FATCA law. However, the affected country HAS TO ASK FOR THE EXTENSION.
On September 18 we said on the blog:

“Well, it’s been quite a week. At approximately 4:45 p.m. today the IRS issued a notice confirming that the FATCA implementation date will be extended to September 30, 2016. As you know Canada has a Model 1 IGA. Assuming the correctness of the post in the above tweet:
Model 1 IGA Jurisdictions for Which the Obligation to Exchange Is In Effect — For those Model 1 IGA jurisdictions where the obligation to exchange is in effect now, Notice 2015-66 provides that FFIs in that country will be treated as FATCA compliant, and not subject to withholding, so long as the partner jurisdiction notifies the U.S. before September 30 that it requires more time, and “provides assurance that the jurisdiction is making good faith efforts to exchange the information as soon as possible.” Notice 2015-66 does not, however, change the deadline for FFIs to report information to their local tax authority, which remains governed by law of that country.”

We therefore instructed our legal counsel to notify the Government of Canada (and they have) of this development and request that the Government of Canada NOT disclose your banking information to the IRS.
— Today, September 21, we posted a new ADCS blog in which we specifically asked Canada’s Minister of National Revenue, Kerry-Lynne Findlay, a defendant in our lawsuit, to apply for the extension before September 23, the date the private account information is due to be sent to the U.S. IRS.
We said:

September 21, 2015
The Honorable Kerry-Lynne Findlay,
Minister of National Revenue
House of Commons
Dear Minister Findlay,
We have an urgent time-sensitive request regarding our litigation in which you are a defendant, which we believe will be helpful to both plaintiffs and Government defendants, but which needs to be acted on no later than by end of business day September 22, 2015.
We are the chair and co-chair (and legal counsel) of the Alliance for the Defence of Canadian Sovereignty. We are the non-profit organization which is prosecuting the FATCA lawsuit against the Government of Canada. The lawsuit is “live”, “well” and expected to move to full trial in 2016. We are at: http://www.adcs.adsc.ca.
By way of background:
1. On February 5, 2014 the Government of Canada entered into a “Model 1” IGA agreement concerning the imposition of the U.S. FATCA (“Foreign Account Tax Compliance Act”) law in Canada.
2. On June 19, 2014 the Government of Canada enacted the FATCA enabling legislation through Bill C-31.
3. On July 1, 2014 FATCA became the law of Canada. The IGA required that Canada (via the CRA) report the banking information of those defined by the U.S. to be U.S. Persons to the IRS
4. The FATCA IGA required that the information be reported no later than September 30, 2015.
5. The Government of Canada has indicated to our legal counsel that it intends to report the banking information of those identified as “U.S. persons” to the IRS on September 23, 2015.
On the afternoon of Friday, September 18, the U.S. Internal Revenue Service issued Notice 2015-66, pursuant to which the deadline for the turnover of FATCA data (for countries with a Model 1 IGA agreement) has been extended for one year. Countries with a Model 1 IGA (including Canada) are no longer required to report to the IRS by September 30, 2015. It is required that Model 1 countries request this extension from the IRS.
See:

IRS extends FATCA Compliance Date for one year to September 30, 2016


http://www.irs.gov/pub/irs-drop/n-15-66.pdf
REQUEST:
In light of the large number of Canadian citizens potentially affected AND in view of the fact that the Government of Canada and the Minister of National Revenue are defendants in the Deegan and Hillis lawsuit AND in view of the fact that the Government is NO longer required to transfer the FATCA data to the IRS we request:
That the Government of Canada apply for the extension, no later than by end of business day September 22, to NOT transfer the data with a view to meeting a September 30, 2015 deadline that is NO longer required.
Clearly, the Government of Canada, irrespective of its FATCA obligations to the United States, has the opportunity to not transfer the private banking information of innocent Canadian citizens to the United States Internal Revenue Service.
Your action in requesting the permitted delay in the transfer would be significant for both plaintiffs and defendants as we move down the litigation road.
Should you need more information I ask that you contact Mr. John Richardson our legal counsel and co-chair.
Sincerely,
Dr. Stephen Kish, Chair, Alliance for the Defence of Canadian Sovereignty
John Richardson, Co-Chair and Legal Counsel
cc:
Andrew Treusch, CRA
John Ossowski, CRA
Kevin Shoom
The Honourable Joseph Oliver

The #StopFatca Press Release and Social Media Page

cross posted from the ADCSovereignty WordPress Blog
stop fatca
ADCS PR pdf file: ADCS PR 19SEP15c pdf
ADCS PR png file: ADCS PR 19SEP15 png
 
I am working on this post as I post it and it will be constantly updated. Please act ASAP!
We want to get this blasted all over the world in the next 3 days. Every US Person abroad needs to put the same pressure on their own governments TO STOP THESE TRANSFERS FROM TAKING PLACE as all Model 1 IGA’s require turnover of information by September 30. Each government has TO ACTUALLY REQUEST THIS EXTENSION FROM THE IRS, so members need to take responsibility for making sure their respective tax authority/government does so. A widget on this post will show any tweets using the hashtag #StopFatca so all can see which countries the message is being spread from.
For Twitter:
Please use this hashtag: #StopFatca.
Please use RT on every Tweet
You can use this shortened link in order to get more info, hastags, etc into the tweet: http://bit.ly/1WaBY1i
Please,if you already have followers who are not expats but may be sympathetic, share other political issues, please send them the tweet directly with the RT; don’t assume they will see it in their feed just because they follow you. Creating a network with other users is important in order to utilyze social media to the max.
Sample Tweets to individuals; Notice you can simply copy/paste these (the plain text just below this paragraph and directly above the picture of the tweet) directly:
CDN govt 2 turn over 1million+ of ur fellow CDNs 2 IRS
Let them know u won’t tolerate this #StopFatca RT http://bit.ly/1WaBY1i

//platform.twitter.com/widgets.js
Continue reading The #StopFatca Press Release and Social Media Page

IRS extends FATCA Compliance Date for one year to September 30, 2016

 
cross posted from the ADCSovereignty Blog


Well, it’s been quite a week. At approximately 4:45 p.m. today the IRS issued a notice confirming that the FATCA implementation date will be extended to September 30, 2016. As you know Canada has a Model 1 IGA. Assuming the correctness of the post in the above tweet:

Model 1 IGA Jurisdictions for Which the Obligation to Exchange Is In Effect
For those Model 1 IGA jurisdictions where the obligation to exchange is in effect now, Notice 2015-66 provides that FFIs in that country will be treated as FATCA compliant, and not subject to withholding, so long as the partner jurisdiction notifies the U.S. before September 30 that it requires more time, and “provides assurance that the jurisdiction is making good faith efforts to exchange the information as soon as possible.” Notice 2015-66 does not, however, change the deadline for FFIs to report information to their local tax authority, which remains governed by law of that country.

We have instructed our legal counsel to notify the Government of Canada (and they have) of this development and request that the Government of Canada NOT disclose your banking information to the IRS.
It’s been quite a week. We will keep you posted.
 
John Richardson
 
 

Justice Martineau provides @ADCSovereignty the only thing worse than a root canal

 
UPDATE:
Please go to these articles about the lawsuit and comment:
Financial Post
Globe & Mail
 
cross posted from the ADCSovereignty WordPress blog
 
Part 1: Justice Martineau provides @ADCSovereignty the only thing worse than a root canal

 
I  left my root canal appointment this afternoon to a message announcing that Justice Martineau had rendered his decision. We did not win round 1. Notice that I did NOT say that the Government won round 1.
Here is the decision:
T-1736-14 decision sept-16-2015
Before, I comment specifically on the decision, I want to be clear on the following points:

  1. This decision marks the end of the beginning. It has always been clear that this litigation would NOT stop at the first level of trial.
  2. The “summary trial” on the Tax Treaty issues was a “carve out” of the main Charter issues.
  3. Obviously we continue on.

I am not surprised by the result – that is a “win” or a “loss”. What I am surprised at is the content of the decision (which I will get to in a moment).
But first some general thoughts/feelings/comments …
A. As you know, the CRA has announced that it will be sending the results of “FATCA Hunt” to the IRS on September 23, 2015.
This is hardly a surprise, given that Canada, has been and continues (under the Harper Government) to be a “World Leader” in FATCA implementation. Obviously this is  a great disappointment. My guess is that it will be a long time before there are any specific results (meaning letters from the IRS) from this.
This is the beginning of a long struggle. Remember, this is a “marathon” and NOT a sprint. Concern is appropriate. Panic is not. Justice Martineau’s decision does reinforce the principle that the Treaty does NOT obligate the Canada Revenue Agency to assist the IRS in collecting tax on Canadian citizens. Do NOT do anything that is reckless and is a reaction to this decision (as opposed to a response). You will be subject to a good deal of “fear mongering” from various people (accountants, lawyers, bankers …). You should deal with this situation “one FATCA letter at a time”. Remember that a “FATCA Letter” is a letter that indicates that you are under “suspicion of being a U.S citizen”. It does not mean that you are a U.S. citizen.
images (15)The only difference between today and yesterday is that Justice Martineau has ruled against us – clearing the way for the next step.
In any case, Justice Martineau has “cleared the way” for the CRA to send your account information to the IRS. This is not good news.
B. It’s important to see this decision as an event that brings us one step closer to moving this issue through the courts.
For those of you who see the result as failure (and I don’t) I remind you that every failure brings us one step closer to our next success.
 
As George said over at Brock:

“Ladies and gentlemen, we go back to work and keep moving forward.”

I believe that it will end at the Supreme Court of Canada. The jurisdiction of the Supreme Court of Canada is “public importance”.
Interestingly Justice Martineau did NOT make a “costs award” against Gwen and Ginny. He wrote (p 44):
 

“There shall be no costs. This is a case where, in view of the nature of the issues and the public interest involved in clarifying the scope of novel provisions affecting hundreds of thousands of Canadian citizens, no costs should be awarded against the losing parties.”

It strikes me that this is a recognition of the “public importance” of the issues involved, confirming that this is a case that should eventually be heard by the Supreme Court of Canada.
C. Thoughts on Justice Martineau’s decision …
Full disclosure – I read the decision very very quickly. It is 46 pages. I will read it again later, much later. There doesn’t seem to much substance to the decision. A huge part of the decision simply recites the terms of the IGA and the implementing legislation.
Basically, what Justice Martineau says is:
– the IGA was of great benefit to the banks and was supported by the banks (p 21)
– “Congress has spoken” (have you heard that before): Meaning this is a political decision in the United States
– The Government of Canada has the right to make and interpret tax treaties that involve “information exchange”. In this context, it is NOT for the Government of Canada to question the relevance of the information to the enforcement of U.S. tax laws in Canada. Treaties are about giving the treaty partner country information that they want (p 43)
– Whether the IGA is a Treaty or not is irrelevant (from a Canadian perspective) . Either way it is consistent with and within the purview of what is allowed by the Canada U.S. Tax Treaty (p 29)
– If you are a dual citizen, too bad. That’s simply the price of U.S. citizenship or dual citizenship (he doesn’t seem to get that citizenship is being forcibly imposed on people who  believe that they relinquished U.S. citizenship years ago)(p 44)
– Justice Martineau adopts the distinction between the “assessment of taxes and penalties” and the “disclosure of information”. In other words, he rejects the submission that the Government of Canada is assisting the U.S. to collect tax on Canadian citizens. (p 42)
I would imagine that many, many expats will disagree with this last point, as Dash said:

I think Justice Martineau’s ruling boils down to the following:
“Accordingly, in the absence of concrete evidence, it is speculative to suggest that the automatic collection and disclosure of taxpayer information mentioned in the IGA is tantamount to providing help to the US authorities in the collection of taxes.”
This is where I strongly disagree with Justice Martineau. Collecting information about someone’s assets (not just income) can serve no purpose other than to assist in collecting taxes.

 
What this means …
In the world of FATCA, IGAs, and tax treaties the rights of individuals (if they have any) are subordinated to the broader purposes of the information exchange. Justice Martinueau says: “Just renounce” (have you heard that before)? -(p 27)
On the one hand Justice Martineau’s decision may be consistent with the interpretation of  the Tax Treaty.
On the other hand Justice Martineau’s decision makes it clear that individual rights are irrelevant to Tax Treaty interpretation.
The Charter of Rights, on the other hand,  is about the recognition and protection of individual rights. It strikes me that the lack of concern for individual rights in Justice Martineau’s decision (whether correct as a matter of law or not) may strengthen the validity of the Charter of Rights claims.
In closing …
This post is a quick message to supporters. I want to emphasize how much we at the Alliance For The Defence of Canadian Sovereignty value your support and thank you for it! I repeat we thank you. This lawsuit has been and continues to be about you.
I will reread the decision and update this post later this evening or early tomorrow.
John Richardson
P.S. Canada is the country most affected by FATCA and the country with the “moral authority” to resist FATCA. The Harper Government could have chosen to be the “FATCA Terminator”. Instead it decided to establish itself as a “World Leader In FATCA Implementation”. This is further evidence of the Government of Canada behaving as “managers” instead of as “leaders”.
On October 19, 2015 you might remind Prime Minister Harper how you feel about his surrendering Canada’s sovereignty to the IRS.

We Did Not Win the First Round

Justice Luc Martineau has delivered his Decision in the Summary Trial.
i have not read it thoroughly yet, but this indicates information may be transmitted because Justice Martineau has ruled FATCA does not violate the Income Tax Treaty.
Significantly:

[9] I have concluded that the collection and automatic disclosure of account holder information about US reportable accounts (see paragraphs 28 to 34 below) contemplated by Articles 2 and 3 of the IGA is legally authorized in Canada by the provisions of the IGA Implementation Act and Part XVIII of the ITA. Moreover, contrary to the assertions made by the plaintiffs, I find that the collection and automatic disclosure of any such information is not inconsistent with the provisions of the Canada-US Tax Treaty, and does not otherwise violate section 241 of the ITA. Basically, I endorse the general reasoning and the legal arguments submitted by the defendants in their written submissions and reasserted at the hearing by counsel.

Fortunately, he did not award costs to the government so Ginny and Gwen are not responsible for those.

77] For all these reasons, the declaratory and injunctive relief requested by the plaintiffs in their motion for summary judgment shall be denied by the Court, without prejudice to the plaintiffs’ right to pursue their claim that the impugned provisions are ultra vires or inoperative because they are unconstitutional or otherwise unjustifiably infringe Charter rights. There shall be no costs. This is a case where, in view of the nature of the issues and the public interest involved in clarifying the scope of novel provisions affecting hundreds of thousands of Canadian citizens, no costs should be ordered against the losing parties.

Please note, this is a decision on the Summary Trial involving the Income Tax Act and Income Tax Treaty issues and not on the Charter and constitutional issues.
The fight continues……
UPDATE September 17, 2015: I have read the decision a bit more thoroughly. My non-lawyer sense of it is Justice Martineau agrees with Canadian Parliament that “Congress has spoken.”
ADCS Directors are considering options. I think Stephen will post further information as things progress.

Green Party Promises to Repeal FATCA

At last, one of the parties has promised to repeal FATCA if elected.
The Green Party platformpledges:

We will repeal as unconstitutional the Foreign Accounts Tax Compliance Act (FATCA). It essentially deprives any Canadian with US connections (even those short of dual citizenship) of full rights to privacy and treats them as a lesser Canadian.

In addition, the Green Party vows:

We will also repeal Bill C-24 which allows the minister of citizenship to revoke citizenship. Other threats to Canadians will be eliminated with the repeal of Bill C-51.

The Green Party says It’s Time to Restore Democracy. Amen.
Thanks to Tim for sending this to several of us.
I like what I see. Now if the Greens only had a chance of forming the government. At least we know Elizabeth May and the Greens are in our corner and still fighting for us.

USA Charging $2350 U.S. for Relinquishment

Cross Posted from Brock. The United States Department of State has announced they charging $2350 U.S. to relinquish unwanted American citizenship.
From a post by Eric at Brock:
Closely following on the heels of their previous announcement that the $2,350 fee for renunciation — twenty times as high as in any other developed country — “protects” the human right to change nationality, the folks at the State Department have announced that they’ll be extending that “protection” to people who relinquished U.S. citizenship under 8 USC § 1481(a)(1) through (4) and seek to obtain Certificates of Loss of Nationality documenting that fact as well.
In the latest Schedule of Fees for Consular Services to be published in the Federal Register on Tuesday (80 FR 53704, 53707), Under Secretary of State for Management Patrick F. Kennedy or one of his ghostwriter minions proclaims:

Currently, nationals who renounce nationality pay a fee of $2,350, while nationals who apply for documentation of relinquishment of nationality by the voluntary commission of an expatriating act with the intention to lose nationality, do not pay a fee. However the services performed in both situations are similar, requiring close and detailed case-by-case review of the factors involved in a request for a Certificate of Loss of Nationality, and both result in similar costs to the Department.
In the past, individuals seldom requested Certificates of Loss of Nationality from the Department to document relinquishment. Although the Department was aware that an individual relinquishment service was among the most time consuming of consular services, it was rarely performed so the overall cost to the Department was low and the Department did not establish a fee. Requests for a Certificate of Loss of Nationality on the basis of a non-renunciatory relinquishment have increased significantly in recent years, and the Department expects the number to grow in the future, causing the total cost of this service to increase. At the same time, the Department funds consular services completely from user fees. The Cost of Service Model continues to demonstrate that such costs are incurred by the Department when accepting, processing, and adjudicating relinquishment of nationality cases; therefore, the Department will collect a fee from all individuals seeking a Certificate of Loss of Nationality. Taking into account the costs of both renunciation and non-renunciation relinquishment processes, the fee will be $2,350.

If you do not need a CLN in the first place, nothing in the Immigration and Nationality Act requires you to obtain one to document your loss of US citizenship, and people who relinquished before 4 June 2004 did not have to report their relinquishment to the State Department in order to end their status as U.S. tax subjects either. However, FATCA regulations and IGAs require people with U.S. indicia to show their banks a CLN or provide a “reasonable explanation” of why they do not have U.S. citizenship.
See this earlier post for discussion of what banks might accept as a “reasonable explanation”, and let us know if you find a bank which will accept the absurd price-tag as an explanation of why you don’t have a CLN.

Response from Liberals

Because I posted the reply from the NDP via Murray Rankin in its own thread, I am doing the same with the Liberal Reply Trudeau of June 25.

Dear Ms. Swanson:
Thank you for taking the time to write to me with your concerns regarding the Foreign Account Tax Compliance Act (FATCA).
The safeguarding of personal privacy has become an increasingly important issue to all Canadians. The government’s move to ensure that information is reported to the U.S. through Canada Revenue Agency (CRA) and not directly from the banks was a positive step; however, the implications of having the CRA report to a foreign government about Canadian citizens are still troublesome. The Liberal Party of Canada believes that the Conservative government’s efforts to safeguard the personal privacy of Canadians have been inadequate.
While the United States has the right to target tax evaders using offshore accounts, targeting hard working Canadians who pay taxes is unfair. The government of Canada has a responsibility to stand up for its citizens when foreign governments are encroaching on their rights. We believe that the deal reached between Canada and the U.S. is insufficient to protect affected Canadians.
Thank you once again for writing to me; I always appreciate it when Canadians take the time to share their concerns with me. It is through such exchanges of ideas and opinions that I can best represent not only my constituents, but all Canadians.
Sincerely
Justin J.P. Trudeau

Response from NDP

I have just received a response to ADCS on the letter we sent to the leaders five months ago. Here is the reply from Murray Rankin.

RE: US Foreign Account Tax Compliance Act (FATCA)
Thank you for writing to share your ongoing concerns regarding the U.S. Foreign Account Tax Compliance Act (FATCA) and the Intergovernmental Agreement (IGA) between Canada and the United States designed to implement FATCA in Canada.
New Democrats are deeply troubled by the implications of FATCA and the associated IGA, and we are closely monitoring the litigation your organization has commenced against the Government of Canada.
From the beginning, many organizations raised the alarm that the IGA for the implementation of FATCA in Canada may violate the privacy rights of Canadians and could be subject to constitutional challenge.
The NDP has repeatedly raised concerns about the FATCA agreement that was negotiated behind closed doors and rushed through Parliament without proper consultation or examination.
Previously, New Democrats called on the Conservative government to acknowledge the broad concerns expressed by Canadians and civil society organizations regarding the implementation of this IGA. We asked the Conservative government to agree to remove it from omnibus Budget Bill C-31, which granted the Minister of National Revenue sweeping powers to make any regulation necessary to carry out the agreement.
It is my belief that the decision to rush this legislation through Parliament was reckless and, as a result, it lacks the safeguards needed to protect many of the rights that Canadians so dearly value.
New Democrats have repeatedly questioned Conservatives in the House of Commons and at the Standing Committee on Finance. It became abundantly clear that the Conservative government has very little understanding of the consequences of FATCA and has been tone deaf regarding the very real concerns of hundreds of thousands of Canadians.
Moving forward, New Democrats remain committed to ensure that Canadians’ voices are heard and that our laws are consistent with the constitution, the Charter of Rights and Freedoms, and Canadian sovereignty more broadly.
A New Democrat government will order a full and urgent review of the FATCA IGA to identify and address all measures that threaten the constitutional and privacy rights of all Canadians.
We will seek to reopen the IGA for renegotiation with the United States in order to address the serious concerns of Canadians and ensure that their rights are protected. We will do so in an open and transparent manner – instead of the secretive manner pursued by the Conservatives.
More broadly, we will ensure that all proposed legislation is subject to a more robust screening to ensure compliance with the Constitution and the Charter of Rights and Freedoms. The Conservatives have failed to uphold this duty, with the result that, in many instances, litigation was initiated that could have been avoided.
As noted above, New Democrats continue to closely watch the progress of your litigation against the Government of Canada.
We also understand that many people across Canada are now directly facing the consequences of the agreement. New Democrat Members of Parliament will continue to assist individuals access the information and resources they need regarding how the FATCA IGA affects them.
Please feel free to contact me with any concerns you may have.
Sincerely,
Murray Rankin
NDP Candidate for Victoria
NDP Deputy Critic for National Revenue