We’ve written quite a bit about the Foreign Account Tax Compliance Act (FATCA), the United States tax initiative that tries to expand the country’s tax reach overseas. Essentially FATCA tries to take tax money from people who have money in accounts overseas. It has been highly ridiculed, but that hasn’t stopped the law from taking full effect recently.
But now with the acquittal of Raoul Weil, a former top official at the Swiss financial institution UBS, there are questions about how the U.S. will be able to proceed with FATCA-related (and even non-FATCA-related) cases.
Weil was acquitted by a jury after the jurors did not believe the witnesses that the United States brought forth. The witnesses cooperated after being given leniency. The case against Weil stated that the former UBS official helped Americans hide their money in accounts with UBS.
The jury was not convinced that Weil was in any way involved with the alleged conspiracy.
FATCA was already a complicated mess before this case, and now it appears it’s teeth may be a little less sharp than previously indicated. That doesn’t mean you should simply dismiss the requirements of FATCA (and the FBAR) as a result of this case.
But it is an interesting reminder that FATCA is not some ironclad law that will corner you into paying money that you don’t necessarily owe to the IRS. There are obviously some complex factors at play here and no two cases are the same, so consult an attorney if you have some tax complications with money overseas.
Source: Wall Street Journal, “Weil Acquittal Complicates U.S. Tax-Evasion Crackdown,” Andrew Grossman, Nov. 4, 2014