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French-American Group Sues Over Finance Access Woes - Report

Editorial Staff, 8 July 2020

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The report is another example of how people living in Europe, who were born in the US, face difficulties in obtaining access to financial services, hobbled by the long arm of US tax law.

A group representing French-American taxpayers is filing a new lawsuit over US tax and banking rules which, they say, stop them from opening online banking accounts in France, a report quoting their lawyer said earlier this week.

The civil suit aims to encourage a Paris court to designate a judge who would pursue an investigation into claims that French citizens are exposed to discrimination because of the way in which extra-territorial US tax rules operate, Antoine Vey told AFP, the French news agency.
 
The Accidental Americans Association is fighting for an exemption from a demand, coming from the US Internal Revenue Service since 2013, that all citizens file extensive details on any foreign bank accounts with their yearly revenue declarations - even if they have not lived or worked in the US for years. Since 2010, expat US citizens have faced a tough battle to obtain financial services due to stipulations in the Foreign Account Tax Compliance Act, enacted in late 2010.
 
Foreign financial institutions must comply with US information requests about their clients, otherwise they will be hit with a 30 per cent US withholding tax. As a result, many foreign banks no longer welcome US citizens as clients because they see them as a costly compliance burden. Besides the AAA, other groups asking for a change to US tax treatment of expats include American Citizens Abroad

The AFP report said that previous lawsuits, including one filed against France with the European Commission last October, have failed to prompt any official inquiries from prosecutors so far.

"You can't exclude someone because of their nationality," Vey was quoted as saying. "It's clearly discriminatory."

There have been moves by firms to try and ease the financial access plight of US expats in continental Europe. For example, in October 2018 London & Capital, the wealth manager with a special focus on serving expat Americans and clients with links to the US, launched a service for US expats in France.

Targeted at the estimated 100,000 Americans who live and work in France, the firm advises clients on local French and US tax regulations as well as giving tailored investment advice on how to put financial ideas into action. The service also covers the management of domestic US and European assets such as retirement accounts. London & Capital offers wealth planning, investment management and reporting services to its clients.

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