Crackdown will completely destroy financial privacy

Source: Kit Daniels

A U.S. tax law taking effect this summer will completely destroy financial privacy in America by forcing many Americans to keep their investments inside the U.S. where they can be easily monitored by regulators.

Set to begin July 1, the Foreign Account Tax Compliance Act (FATCA) grants the IRS broad powers to coerce foreign financial institutions (FFIs) to snitch on their American clients, effectively turning them into agents of the IRS.

But the law has nothing to do with tax evasion whatsoever. Rather, by scaring FFIs away from doing business with American investors, it will force many Americans to keep their investments inside the U.S. where they are more easily monitored, according to Porter Stansberry, the founder of theStansberry & Associates Investment Research Conference.

“[FATCA] is all about the record-keeping that is required and the requirement that these banks [FFIs] withhold taxes from any transaction,” he said yesterday on the Alex Jones Show. “And there is just no way that they can meet these requirements.”

“The government knows that, of course, so what it’s doing is forcing a lot of investment in U.S. dollars back into domestic banks.”

And concurrently, the Financial Industry Regulatory Authority (FINRA), a non-governmental organization that regulates American financial firms, is setting up a centralized database of investor transactions occurring within the U.S. called the Comprehensive Automated Risk Data System, or CARDS for short.

“FINRA claims they want access to your account in real-time, so they can monitor whether or not your broker is providing the ‘right advice’ for you,” Stansberry added. “But the reality is that it’s now impossible for Americans to conduct investments with any privacy whatsoever because they can’t use an offshore broker [due to FATCA] and now FINRA’s going to have constant monitoring in real-time of every single investment account in the country.”

And Stansberry isn’t the only investment expert concerned with CARDS.

“This goes beyond mere concerns about Big Brother,” said Henry Hu, a law professor at the University of Texas in Austin, to the Wall Street Journal. “I think CARDS creates a new form of systemic risk.”

Hu likened this centralized record keeping of Americans’ financial transactions to Pearl Harbor, where “all the ships and airplanes are in one place at the same time.”

“If you were a hostile foreign government, you would immediately put some of your top people to work” on hacking CARDS, he added.

And unfortunately, it doesn’t have to be a hostile foreign government but just about anyone who would benefit from an economic meltdown of America.