Expat banking woes

House panel asked to consider expat banking woes

The U.S. House Financial Services Committee is being asked to hold hearings on the problems Americans are having overseas with banking. Rep. Carolyn Maloney and Rep. Mick Mulvaney have asked the committee to investigate reports of Americans Overseas being denied banking access, both foreign and domestic, as a byproduct of new legislation and Patriot Act regulations. The main concern is the Foreign Account Tax Compliance Act that threatens foreign banks if they do not report to the U.S. Internal Revenue Service about their American clients. Many banks simply have closed bank accounts held by Americans instead of complying with the reporting requirements. Mulvaney and Ms. Maloney head what is known as the House Americans Abroad Caucus. Their request for a hearing was reported by the American Citizens Abroad, Inc., an expat advocacy organization that has been deeply involved in lobbying Congress to loosen restrictions on overseas banking by Americans who live outside the country. Another expat advocacy organization, the Association of Americans Resident Overseas, notes that the Americans Abroad Caucus, a bi-partisan, bi-cameral caucus is designed to represent the interests of Americans living overseas,  Ms.

Maloney is a New York Democrat, and Mulvaney is a South Carolina Republican. Both expat advocacy organizations have been gathering reports of problems Americans are having in banking. They also have offered some changes in legislation that would reduce their problems. For example they have said Congress should treat expats who live overseas different from U.S. citizens who simply stash money in an overseas account. The banking problems have been going on since at least 2008. In the U.S. banking institutions frequently have trouble with overseas customers because they cannot easily comply with the know-your-client rules. Overseas American citizens are consequently being denied the basic right to maintain normal commercial relationships with their country, says the Association of Americans Resident Overseas. American Citizens Abroad said that it has been compiling testimonials from Americans who have been faced with issues of financial lock-out and looks forward to working with both Ms. Maloney and Mulvaney to help educate the legislature, IRS and Treasury Department on the problems and to identify potential solutions.