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Banking difficulties for Americans living overseas still prevalent in the news

Yet another WSJ article published late last week detailed the frustrations that US expats are increasingly experiencing with respect to securing banking solutions as new regulations have been put in place to crackdown on money laundering and tax evasion.

We all know the stories of many people who have had their investment accounts closed. In recent months, firms including Fidelity Investments, Charles Schwab, T. Rowe Price and others have notified clients overseas that they may no longer purchase or trade mutual funds off the back of the Alternative Investment Fund Managers Directive (AIFMD) in Europe (News Flash – European regulation restrictions impact US citizens in Europe looking to invest in US mutual funds).

No one seems to be immune from the restrictions and lockouts. Essentially, financial institutions are looking at the costs of the compliance risk and burden and making a decision as to whether the client relationships are lucrative enough.

This latest article details how some Americans overseas are having trouble handling the most basic financial matters. Some have been turned away from holding checking accounts at certain institutions in the US and abroad and, more recently, stories have also begun to trickle out about banks monitoring online details to determine the location customers are logging in from. Therefore, even if a client uses a US address, banks seem to be monitoring whether this is actually a residence for the individual. The article notes that some overseas individuals have gone to great lengths for a work around solution to make them appear as though they do not live outside of the country. Stories of people opening multiple US bank accounts and alternating wire transfers overseas are not uncommon.

Despite the seemingly narrowing options, there remain financial institutions out there that specifically cater to US individuals abroad and hold the relevant regulatory licenses to advise cross-border individuals. If you, or anyone you know, finds themselves with limited investment options as a result of these continuing changes, please do feel free to contact us to find out more about how we may be able to help.

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