Thread: Financial Privacy Today: The Last Loophole

Financial Privacy Today: The Last Loophole

Written by Gary North on February 29, 2012


You can get it. You just can’t get it at your bank.

How can you get it. At your ATM. It’s cheap. It’s fast. It’s untraceable once you make the withdrawal.

No other way.

Hide your money outside the country? Nonsense. That has not been possible for 35 years. I wrote about this in 1976, when I was on Ron Paul’s staff. Since then, it has gotten worse. FATCA is the nail in the coffin.

Banking privacy is dead. Completely, totally dead. Murdered, really. The US government is the assailant, and FATCA is the murder weapon.

What is FATCA?

In brief, FATCA has two key concepts. First, it requires an additional (and completely unnecessary) layer of reporting from all US taxpayers who have ‘foreign financial accounts’ at ‘foreign financial institutions.’ Though as we have discussed before, both of these critical terms are ridiculously and flagrantly ambiguous, putting the onus entirely on the taxpayer.

Without clarifying what constitutes foreign financial accounts and institutions, Congress has effectively created decades of debate in tax court… a move that will undoubtedly ruin the lives of the unfortunate folks who get dragged into the fight.

The second key issue is that FATCA puts a burden on ALL foreign financial institutions worldwide to enter into an information-sharing agreement with the IRS; this essentially obliges every bank on the planet to submit reports and customers’ private data to the IRS.

Banks who don’t enter into this information sharing agreement will have a 30% tax withheld on funds that originate from, or go through, the US banking system. Further, banks who enter into the information sharing agreement are obliged to withhold the 30% tax on transfers to other banks who do NOT enter into the agreement.

Foreign banks are entering into information-sharing agreements with their governments. Then the governments share this information with America’s IRS.

Currency is the way out. But you cannot withdraw much. It’s for small purchases. It’s for Craigslist deals.

The screws are tightening. They will never get loose until after the Great Default, when the U.S. government goes bankrupt.

Most Americans pay most of their taxes. They don’t have money except what remains after their employer withholds money to send to the IRS.

This new law is hurting Americans who have a lot of money and who want to send it outside the USA. Foreign banks are now refusing to open accounts for Americans.

We are moving toward tyranny. The good news is this: Washington will go bankrupt before we get to tyranny.



Financial Privacy Today: The Last Loophole

Join the Big Bank Exodus

Written by Gary North on February 29, 2012


Some Americans are fed up with the big banks. They are withdrawing their funds and placing them in regional or local banks.

They have several reasons. One is new fees. The old standbye, poor customer service, is also invoked.

The defection rate for large and medsized banks in 2011 was a little over 10%. That’s high. No business wants to lose 10% of its customers.

In 2010, the rate was over 7% but under 10%. So, the exodus is accelerating.

Of course, the bigger issue is which customers. Large banks don’t care about customers whose accounts are not in the top 20%. The figures do not tell us this.

What about small local banks and credit union? The loss was under 1%. This had been over 8% in 2010.

Big banks are under pressure to find new fees. This is driving away customers.

Checking account fees have been on the rise at the nation’s biggest banks over the past year, and customer revolt against big banks really began to mount after Bank of America (BAC, Fortune 500) proposed a monthly fee for debit card use last fall.

Even though the bank later backtracked on its decision, the announcement led to a nationwide, social media-fueled “Bank Transfer Day”, during which customers encouraged each other to dump their big banks for community banks and credit unions.

The report also found that many customers were already unhappy with the customer service at big banks, so when fees were announced or raised, there was even more of an incentive to switch institutions.

My view is that you should have money in a local bank to gain leverage for investing in local real estate. If a bank has repossessed a home, and you are a customer with over $20,000 in your account, the officer in charge of repossessed property will talk with you about getting the property for a minimal down payment.

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http://money.cnn.com/2012/02/27/pf/c...k.net&iid=Lead


Join the Big Bank Exodus