‘Scrap badly conceived FATCA’, deVere CEO demands of US Treasury
Outspoken deVere chief executive Nigel Green has co-authored a five-page letter to the US Treasury Secretary to demand the Trump administration scrap the Foreign Account Tax Compliance Act (FATCA), a ‘badly conceived, badly written, and badly enforced law’.
Green, together with Jim Jatras, his co-leader in the Campaign to Repeal FATCA, sent the letter to Steve Mnuchin, pictured left, on the occasion of his one-year anniversary in office, saying that the former investment banker and Trump appointee had done nothing to scrap the “worst law most Americans have never heard of.”
They said that the law makes “financial pariahs” of eight million US citizens that live overseas.
Green and Jatras said that this was a betrayal of the eight million American citizens who live overseas, the inaction “coming despite promises in the election campaign that, should they win, the Republicans would ‘call for repeal’ of FATCA”.
FATCA is a US law that was brought into force during the Obama administration, and sought to ensure Americans who were making use of overseas bank accounts to avoid their US tax obligations by having these overseas banks – or “foreign financial institutions” – report to the IRS all the relevant details of any accounts held by Americans.
“FATCA is virtually unknown to most Americans but has been wreaking havoc with the global financial system outside the US,” deVere said in a statement alongside the release of the letter to Mnuchin.
“Touted as a weapon against ‘fat cat’ tax evaders stashing funds offshore, FATCA is instead an indiscriminate information dragnet requiring all non-US financial institutions (banks, credit unions, insurance companies, investment and pension funds, etc.) in every country in the world to report data on all specified US accounts to the IRS [Inland Revenue Service].
If any country refuses to comply, the statement went on, FATCA provides for its financial sector to be hit with “crippling penalties”.
The letter, dated November 14, states: “We are writing to you on the supposition that in a democratic country, elections should have consequences. When a political party stands before the electorate on declared principles and makes specific promises, those principles and promises should be reflected in how that party governs under its mandate from the voters.”
‘Unreasonable search and seizures’
In the 2016 Republican Platform, the party manifesto under which Donald Trump ran for president, it was claimed that FATCA’s “Foreign Bank and Asset Reporting Requirements result in government’s warrantless seizure of personal financial information without reasonable suspicion or probable cause”.
The manifesto pointed out that Americans living overseas should enjoy the same rights as Americans residing in the US, “whose private financial information is not subject to disclosure to the government except as to interest earned”.
“The requirement for all banks around the world to provide detailed information to the IRS about American account holders outside the United States,” it said, “has resulted in banks refusing service to them.
“Thus, FATCA not only allows ‘unreasonable search and seizures’ but also threatens the ability of overseas Americans to lead normal lives. We call for its repeal and for a change to residency-based taxation for US citizens overseas.”