U.S. Foreign Account Tax Compliance Act (FATCA)

Important Client Information

At Atlantic International Bank we want to respectfully inform our clients about the implications of the recently adopted FATCA regulations and how this US Law may affect some of our processes.

FATCA is legislation from the United States enacted since 2010 and will become effective in 2014. It is intended to prevent “U.S. Persons” from evading U.S. Tax obligations using financial accounts held outside of the United States, by requiring Foreign Financial Institutions (FFIs) to provide to the IRS information on certain US Persons and foreign entities owned by US Persons.

FFIs that do not comply with FATCA standards will be subject to a 30% withholding penalty on all payments, including:

  • US source income (such as interest and dividend payments)
  • sales and redemption proceeds from certain US securities
  • so-called foreign pass thru payments, amongst others

According to U.S. Tax law, a U.S. person is:

  • A citizen of the U.S. (including an individual born in the U.S. but resident in another country, who has not renounced U.S. citizenship);
  • A lawful resident of the U.S. (including a U.S. green card holder);
  • A person residing in the U.S.
  • You also may be considered a U.S. Person if you spend a considerable amount of time in the U.S. on a yearly basis.
  • S. corporations, estates and trusts are also considered U.S. persons.
  • Any other Person subject to U.S. income tax obligations

According to Atlantic International Bank’s approved Code of Conduct, we condemn and strictly prohibit any practices or procedures that may facilitate our clients or account holders any assistance in avoiding FATCA compliance.

As of July 1st, 2014, Atlantic International Bank’s on-boarding processes and legal agreements will incorporate FATCA due diligence requirements regarding the identification of the accounts held directly or indirectly (via interposed structures) by any US Persons or FATCA Exposed Persons (FEPs).

Certain pre-existing accounts will require detailed ongoing investigation.  Certain preexisting accounts not all of them (Prima Facie, 1M$ and the rest).  Atlantic International Bank will ask all applicable key counterparties and other stakeholders (Prima Facie or other FFIs as AIBL who are clients) on whether they intend to be compliant with FATCA.

For more information about FATCA, please visit the IRS website or contact us at our dedicated email address [email protected] to help answer your queries.