5 ms·

> “Sorry, you have citizenship from the High Risk Country list, accordingly I’m not allowed to open this account for you. This is a commercial decision of the b

> “Sorry, you have citizenship from the High Risk Country list, accordingly I’m not allowed to open this account for you. This is a commercial decision of the bank and will not be reversed.” This sounds like what I heard from a lot of non-US financial companies when I used to be American and then didn't want to open accounts. Frustrating but predictable and probably intended outcome from regulator behavior.

__d 5y ago
FATCA made life difficult for non-US banks supporting US-citizen customers. Many won't open new accounts, some forcibly closed existing accounts.
- fmajid 5y ago
  You are effectively limited to the few large banks that can handle the red tape. It wasn't designed to make US persons' life abroad miserable, even if it did succeed handily to the point some US citizens are opting to renounce their citizenship rather than keep enduring the pain. The intent was to make the IRS' compliance processes easier. The level of detail in the FinCEN reporting Americans with financial assets abroad has also dramatically risen in the last 20 years. It used to be you just sent a list of banks along with whether your assets there exceed $10,000 or not, now you have to send a detailed summary with a max account balance (adjusted for exchange rate).
  - rswail 5y ago
    What is interesting is that revoking your US citizenship (or Green Card permanent residency) isn't sufficient to stop you being subject to IRS law. It actually costs you money, $2,350, to give up your citizenship. The filings to give up a Green Card is equally byzantine.
    - fmajid 5y ago
      Yes, and a substantial exit tax.
      - mneubrand 5y ago
        For net worth >$2M or pretty high average income tax liability in the years before expatriation. Otherwise it's just the $2350
klabb3 5y ago
See also - "you have a niche web browser which breaks our js fingerprinting so screw you" - "you had a dispute on your airbnb account and we don't have time to figure out whether you or the host are wrong so we'll just kick you both off" If that sounds shitty, we also have: - Another company had marked you as risky, and since we trade risk profiles with each other, we just don't want to deal with you. Except in most cases you won't ever learn the reason, much less have a fair appeals process. I have a feeling we have a LOT more of this than people think already, but companies aren't talking about it and it's not regulated except for a few sectors. In the future though, it'll be a lot more. With the expansion of tracking, we're gonna get a LOT more persona non grata/shadowbanning and social credit systems.
rswail 5y ago
See FACTA. If an overseas bank (say in Australia) open an account for a US citizen, subject to US IRS taxes, then they have US regulations to comply with for not just that account. FACTA requires an overseas bank to identify US account holders and then report their personal and other details to the IRS, including balances and withdrawals. So now some bank in a foreign country has to not only do due diligence on you and as soon as you say you are a US taxpayer or there are signs you are, it is required to report your account to the IRS, and if it doesn't it's subject to a 30% withholding tax on transfers to it as an institution from the US. Of course, under the rules, it's up to the bank to be careful, but the local tax authority doesn't care, so often there's a "Don't Ask, Don't Tell" sort of attitude.
- lisper 5y ago
  Personal anecdote: I was the manager of a small investment fund that invested in a YC company that was acquired by an Australian company. As a result we ended up owning some stock in this Australian company. In order to sell this stock and cash out, I had to open up a brokerage account for the fund (which was an LLC) in Australia. Very long story short: it was a freakin' nightmare. It took six months. All to sell some shares in a public company.

__d 5y ago

FATCA made life difficult for non-US banks supporting US-citizen customers. Many won't open new accounts, some forcibly closed existing accounts.

fmajid 5y ago
You are effectively limited to the few large banks that can handle the red tape. It wasn't designed to make US persons' life abroad miserable, even if it did succeed handily to the point some US citizens are opting to renounce their citizenship rather than keep enduring the pain. The intent was to make the IRS' compliance processes easier. The level of detail in the FinCEN reporting Americans with financial assets abroad has also dramatically risen in the last 20 years. It used to be you just sent a list of banks along with whether your assets there exceed $10,000 or not, now you have to send a detailed summary with a max account balance (adjusted for exchange rate).
- rswail 5y ago
  What is interesting is that revoking your US citizenship (or Green Card permanent residency) isn't sufficient to stop you being subject to IRS law. It actually costs you money, $2,350, to give up your citizenship. The filings to give up a Green Card is equally byzantine.
  - fmajid 5y ago
    Yes, and a substantial exit tax.
    - mneubrand 5y ago
      For net worth >$2M or pretty high average income tax liability in the years before expatriation. Otherwise it's just the $2350

klabb3 5y ago

See also - "you have a niche web browser which breaks our js fingerprinting so screw you" - "you had a dispute on your airbnb account and we don't have time to figure out whether you or the host are wrong so we'll just kick you both off" If that sounds shitty, we also have: - Another company had marked you as risky, and since we trade risk profiles with each other, we just don't want to deal with you. Except in most cases you won't ever learn the reason, much less have a fair appeals process. I have a feeling we have a LOT more of this than people think already, but companies aren't talking about it and it's not regulated except for a few sectors. In the future though, it'll be a lot more. With the expansion of tracking, we're gonna get a LOT more persona non grata/shadowbanning and social credit systems.

rswail 5y ago

See FACTA. If an overseas bank (say in Australia) open an account for a US citizen, subject to US IRS taxes, then they have US regulations to comply with for not just that account. FACTA requires an overseas bank to identify US account holders and then report their personal and other details to the IRS, including balances and withdrawals. So now some bank in a foreign country has to not only do due diligence on you and as soon as you say you are a US taxpayer or there are signs you are, it is required to report your account to the IRS, and if it doesn't it's subject to a 30% withholding tax on transfers to it as an institution from the US. Of course, under the rules, it's up to the bank to be careful, but the local tax authority doesn't care, so often there's a "Don't Ask, Don't Tell" sort of attitude.

lisper 5y ago
Personal anecdote: I was the manager of a small investment fund that invested in a YC company that was acquired by an Australian company. As a result we ended up owning some stock in this Australian company. In order to sell this stock and cash out, I had to open up a brokerage account for the fund (which was an LLC) in Australia. Very long story short: it was a freakin' nightmare. It took six months. All to sell some shares in a public company.