Good advice Roberto! Also do not forget just a few years ago when during a peso meltdown when the Mexican government involuntarily converted all dollar accounts to pesos with no recourse to dollar account holders.
Also do not believe for one moment that the US IRS does not have access to almost all 'offshore' accounts as needed.
No reflection on any forum members, but I would never post my intentions on an open forum such as this.
-spy
Foreign banks to become IRS spies using Qualified Intermediary program?
July 9, 2009
Offshore Banks Terminate "Toxic American Clients"
By Robert E. Bauman JD, International Living Legal Counsel
Thanks to unprecedented pressure and threats aimed at foreign banks by the U.S. Internal Revenue Service (IRS), Americans, both at home and abroad, are being blocked from being able to have bank or investment accounts in Swiss banks—and this IRS inspired anti-American movement may spread to other countries.
In the last few months, tens of thousands of Americans’ offshore accounts have been shut down and new account requests denied.
It started in Switzerland, where resident U.S. citizens were told their Swiss bank accounts would be closed. Among the banks imposing this “Yankee Go Home” policy are the two largest Swiss banks, UBS and Credit Suisse. HSBC and even small private banks, like Mirabaud & Cie. have adopted this policy. UBS alone closed a reported 52,000 U.S. accounts.
More than 5 million Americans live abroad, including about 30,000 in Switzerland. A large number of Americans in both groups could be hurt if this “no American bank accounts” movement spreads. Although at first, terminations mostly involved investment accounts, American expatriates fear that closures of personal operating accounts for individuals and U.S. business accounts may be next.
UBS decided to end offshore banking with U.S. clients last July after admitting that bank officials assisted an unknown number of American clients to evade U.S. taxes. Now UBS is embroiled in a bitter court case with the IRS that threatens the future of the Swiss banking secrecy law.
Other Swiss banks, fearing UBS-like legal problems and IRS red tape are adopting a safety-first attitude, abandoning U.S. clients. The banks justifiably feel threatened by an IRS demand that UBS surrender the names of its 52,000 American accounts. The IRS is also threatening to sue other Swiss banks for U.S. client names.
“More banks are publicly announcing that they don’t want American clients anymore. The banks are simply not willing to take such risks and are eliminating American clients,” says Andy Sundberg of the Geneva-based group, American Citizens Abroad. “The U.S. administration has decided that it is justified to turn its citizens into toxic clients,” he claims.
This bizarre international banking disruption results from the Obama administration’s ravenous hunger for more tax collections to finance its plans to remake the U.S.
The stick the IRS is using is the little known IRS “qualified intermediary” (QI) program. Established in 2001, more than 7,000 foreign banks participate in the QI program. They must because without IRS-QI approval the foreign banks can be cut off from access to the U.S. financial and banking systems (as some few already have), a ruinous possibility.
Currently the QI system allows participating IRS-approved banks to have U.S. clients without disclosing their names to the IRS. Until now the IRS has relied on the banks promise to identify U.S. clients, withhold a 30% tax on U.S. securities in their accounts, and send taxes owed to the IRS. But the IRS claims offshore banks and their U.S. clients have become tax cheats, each year evading at least $15 billion in taxes owed under the QI system.
Under new QI rules proposed to take effect in 2011, foreign banks must become IRS spies, actively investigating and reporting to the IRS, not only information on individual U.S. clients, but also on legal entities (trusts, corporations, foundations) that Americans control as beneficial owners. U.S. persons are required by law to report all offshore accounts on annual IRS Form 1040, but the IRS claims thousands fail to do so.
Adding to the woes of offshore banks and their American clients, the U.S. Securities and Exchange Commission (SEC) is trying to force offshore banks that give investment advice to Americans, even if rendered outside the U.S., to register with the SEC, a complex and costly process.
If you have a current bank or investment account in a foreign country, ask your bank what its policies are and how they may affect you. You may need to make other banking plans.
