> The Foreign Accounts Taxation Compliance Act required all foreign banks to disclose the financial information of any American with assets over $50,000 sitting in banks outside of the US.
> Steep penalties add muscle to the law. If a foreign bank – not just in Canada, but anywhere – fails to report even a single US citizen as a customer to the IRS, the US Treasury department would withhold 30% of the banks’ US income as penalty.
The FATCA requirements are actually quite simple, and the theoretical penalties are just that--theoretical.
As a practical matter, the FATCA US customer report is satisfied by a relative spartan list of names, tax ids, account numbers, and balances. In other words, something a simple report should be able to generate in about .000001 seconds.
If a bank can't handle that type of compliance, you should take your money elsewhere because it indicates serious internal control issues.
I don't think they are really asking about the ease by which a bank should be able to generate that report, but rather the necessity to do so.
> In September 2018 the European Union foreign policy head, Federica Mogherini, proposed the development of a new "special purpose financial vehicle" intended to bypass the U.S. controlled Society for Worldwide Interbank Financial Telecommunication payments system - commonly known as SWIFT. The seven founding members of this new system are to be Iran, the European Commission, Germany, France, the U.K., Russia and China - but not the United States.
Web sites like http://non-fatca-banks.com/pk.html list which banks are members of SWIFT, because that means they are exposed to penalties should they fail to follow FACTA reporting laws. For example, the National Bank of Pakistan followed FACTA, see https://www.nbp.com.pk/fatca/index.aspx .