There is another reason for bank account closures and freezes due to FATCA. Many former US citizens did not know of something called a Certificate of Loss of Nationality, or CLN. Of those that knew of it, many did not get it as it was not required and it just another hassle. Now, decades after they relinquished US citizenship, many have no way to prove that they are no longer a US citizen and thus required to follow US reporting laws. Their financial institution demands the CLN, they don’t know what it is or at least do not have one and their account is closed or frozen. I know of at least one case in which a former US citizen had their CLN but the bank still closed the account.
I have no idea how the super rich get around it other than they can pay the fines and fees. It does seem that due to being able to afford high quality advisors that many were tipped off and moved their money somewhere where this was not a problem. By moving their money I do not mean to another country but into some other, more acceptable form. I would not be surprised that certain cash investments in the homeland would not hurt, but do not know. Those whose FBAR cases I have read about are certainly much wealthier than I but by no means super rich. I do not recall a single case of a super rich person getting caught up in the except for Paul Manafort and I’m not sure he qualifies as super rich. He might, I just don’t know.
This is kafkaesque.. It's hard to stay positive these days. I wonder if really wealthy people rely on having staff in their non US country, paid through a corporation or something, and the staff pay the bills. There must be some workaround.
Thanks for the explanation, I now recall some of these phenomena were discussed on ZH also..
I was just wondering, how do the super-rich get around these issues?
There is another reason for bank account closures and freezes due to FATCA. Many former US citizens did not know of something called a Certificate of Loss of Nationality, or CLN. Of those that knew of it, many did not get it as it was not required and it just another hassle. Now, decades after they relinquished US citizenship, many have no way to prove that they are no longer a US citizen and thus required to follow US reporting laws. Their financial institution demands the CLN, they don’t know what it is or at least do not have one and their account is closed or frozen. I know of at least one case in which a former US citizen had their CLN but the bank still closed the account.
I have no idea how the super rich get around it other than they can pay the fines and fees. It does seem that due to being able to afford high quality advisors that many were tipped off and moved their money somewhere where this was not a problem. By moving their money I do not mean to another country but into some other, more acceptable form. I would not be surprised that certain cash investments in the homeland would not hurt, but do not know. Those whose FBAR cases I have read about are certainly much wealthier than I but by no means super rich. I do not recall a single case of a super rich person getting caught up in the except for Paul Manafort and I’m not sure he qualifies as super rich. He might, I just don’t know.
This is kafkaesque.. It's hard to stay positive these days. I wonder if really wealthy people rely on having staff in their non US country, paid through a corporation or something, and the staff pay the bills. There must be some workaround.