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Monday, April 27, 2015
FATCA Security Risks with Sensitive Data
The Foreign Account Tax Compliance Act,
commonly called “FATCA” has caused Americans abroad to be fearful of
security risks when their personal financial information is reported by
non-US financial institutions or foreign government agencies to the IRS.
FATCA reporting will include the name, address and taxpayer
identification number of each US account holder at the financial
institution; the account number; account balance and value; the
account’s gross receipts and gross withdrawals or payments; and other
account related information requested by the Internal Revenue Service
(IRS). The Treasury Inspector General for Tax Administration has expressed concerns with the security of data transmission as mandated by FATCA. In September of 2014 the IRS issued a fraud alert to
all international financial institutions that are complying with FATCA.
Scam artists posing as the IRS have fraudulently solicited financial
institutions seeking account holder identities as well as financial
account information. Financial institutions directly registered to
comply with FATCA, and those in jurisdictions that are treated as having
an IGA in effect to implement the FATCA provisions through their home
governments, have already been approached by parties impersonating
themselves as the IRS. The IRS now has reports of incidents from various
countries and continents.
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