FATCA Hunt: "Review, Identify, Report" on possible "USness" in acct of Canadian born teenager https://t.co/Pf3tuNFMOK – Beware of RBC Way!

— Citizenship Lawyer (@ExpatriationLaw) January 17, 2016

The above tweet references the following interesting comment on the Isaac Brock Society.

I think you’ll appreciate this. One of my minor children has some money saved up from baby sitting and odd jobs. The amount is now large enough that she asked me to help her invest the sum for down the road. So off we go to my favourite discount brokerage, RBC Direct Investments to open an investment account for her. Because she’s a minor, the account has to be opened as “BC_Doc In Trust For Canadian Born Teenage Daughter.”
So we get logged in to the RBC website and proceed to the application screen. So far so good. Then the Unaskable Questions start getting asked:
1) Trustee– Are you a U.S. Citizen or a U.S. resident for tax purposes?
a) Dare to click “Yes” and up pops a notice, “To comply with regulations, you will be presented with a W9 form with your application package.”
b) Social Security Number (SSN)– Write it down heren Now consider yourself officially marked and packaged for the IRS. Good luck sucker.
2) Is the Beneficiary a U.S. Citizen or a U.S. resident for tax purposes?
a) Go ahead, I dare you– click “Yes”– Guess what, you’re going to receive another one of those tasty W9 forms so we can serve your minor up to Uncle Sam as a tasty treat.
b) Social Security Number (SSN)– welcome to our data base kid. If you’re lucky, in a few years, we’ll draft you and send you off to some country whose name you can’t pronounce to die so that a bunch of Homelanders can get fat sitting on their couches while they watch Netflix and oil their guns.
3) How many countries is the beneficiary a resident of for tax purposes?
Reason– You may have told us you’re only Canadian but it really doesn’t matter what you think kid– if the U.S. says you’re American, then by God, “Congress has spoken.”
a) Beneficiary’s country of residence for tax purposes?
4) Beneficiary’s country of birth?
a) Select your country of birth– by now, you know where this is headed. It’s part of a new U.S. policy called, “Leave no (ex-pat) American behind.” Even if they don’t want to be American. Or consider themself to be American. Or didn’t even know they were American.

The appropriateness of the “place of birth question” …
Here is the part of the FATCA IGA that governs “due diligence” requirements for new account openings – (Annex I – Part III – Starting on page 26).

III. New Individual Accounts
The following rules and procedures apply for purposes of identifying U.S. Reportable Accounts among Financial Accounts held by individuals and opened on or after July 1, 2014 “New Individual Accounts”.
A. Accounts Not Required to Be Reviewed, Identified, or Reported
Unless the Reporting Canadian Financial Institution elects otherwise,either with respect to all New Individual Accounts or, separately, with respect to any clearly identified group of such accounts, where the implementing rules in Canada provide for such an election, the following New Individual Accounts are not required to be reviewed, identified, or reported as U.S. Reportable Accounts:

1. A Depository Account unless the account balance exceeds $50,000 at the end of any calendar year or other appropriate reporting period.

2. A Cash Value Insurance Contract unless the Cash Value exceeds $50,000 at the end of any calendar year or other appropriate reporting period.
B. Other New Individual Accounts.
1. With respect to New Individual Accounts not described in paragraph A of this section, upon account opening (or within 90days after the end of the calendar year in which the account ceases to be described in paragraph A of this section), the Reporting Canadian Financial Institution must obtain a self-certification, which may be part of the account opening documentation, that allows the Reporting Canadian Financial Institution to determine whether the Account Holder is resident in the United States for tax purposes (for this purpose, a U.S. citizen is considered to be resident in the United States for tax purposes, even if the Account Holder is also a tax resident of another jurisdiction) and confirm the reasonableness of such self-certification based on the information obtained by the Reporting Canadian Financial Institution in connection with the opening of the account, including any documentation collected pursuant to AML/KYC Procedures.
2. If the self-certification establishes that the Account Holder is resident in the United States for tax purposes, the Reporting Canadian Financial Institution must treat the account as a U.S. Reportable Account and obtain a self-certification that includes the Account Holder’s U.S. TIN (which may be an IRS Form W-9 or other similar agreed form).
3. If there is a change of circumstances with respect to a New Individual Account that causes the Reporting Canadian Financial Institution to know, or have reason to know, that the original self-certification is incorrect or unreliable, the Reporting Canadian Financial Institution cannot rely on the original self-certification and must obtain a valid self-certification that establishes whether the Account Holder is a U.S. citizen or resident for U.S. tax purposes. If the Reporting Canadian Financial Institution is unable to obtain a valid self-certification, the Reporting Canadian Financial Institution must treat the account as a U.S. Reportable Account.

It has been confirmed that TD Canada Trust has sent a “FATCA Letter” to an 8 month old baby!

For comments on the above “TD Green Chair” see the following post at the Isaac Brock Society.
 
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