Using ONLY second citizenship for new emi/crypto/bank accounts?

[Nigital Domad]

Hello friends - I have a US client with a second citizenship through one of those tax haven island citizen investment programmes. He has a whole other life already set up on that island (residence, utility bills, phone, etc.)
He asked me if I see any downside to him using ONLY his non-US citizenship to open new financial accounts around the world from now on (EMI, Crypto, banks, etc.) This would allow him to not have to deal with pesky Factah and similar issues since any CRS reporting would only go back to his island nation tax authorities (which does not care about income earned offshore).
Only his US and non-US name would be the same (are names even used as unique identifiers if all other information (tax ID, address, nationality, etc.) is different?)
Other than the hassle of him having to keep his US and non-US financial lives strictly segregated for tax purposes at all times in the future, does anyone see a problem with this approach?

 

[wellington]

Well, when uncle sam finds out = downside.

 

[JohnnyDoe]

Unless his non us passport shows a non us place of birth, every financial institution will ask for his us passport or for evidence of renunciation of his U.S. citizenship.

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[daniels27]

JohnnyDoe said:
Unless his non us passport shows a non us place of birth, every financial institution will ask for his us passport or for evidence of renunciation of his U.S. citizenship.
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In Canada you can hide it, Swiss passports do not show any place of birth.

 

[Nigital Domad]

Interestingly the banana republic authorities only (accidentally) used the town of his birth on his new passport - not his birth country. For instance, his second passport says "place of birth: Chester". That's it. No nation.
And since there are Chesters in places like the UK and other nations, the few financial institutions he has tried this at so far have no asked for any additional documentation.

 

[uplana]

It was a very good idea to keep these discussions within the Mentor Group, as I am sure they closely follow all discussions on this topic in the public forums.

However, it is good to know that changing your birthplace with the right documents to align with your objectives is not the most difficult part.

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[Nigital Domad]

Important disclaimer: I am DEFINITELY NOT advising my client to break any rules or laws of ANY nation. I am just trying to help him navigate the strange waters he finds himself in. If this discussion is too far afield for this forum (or website) I encourage any moderator to delete this thread. I personally value my membership and connection to OCT far too much to risk it on gray hypotheticals for a client.

 

[wellington]

Lot of you are forgetting one important thing.

All these investment citizenships share your information with the FBI, after pressure was plied by the US as they were extensively used for fraudulent uses, and spying or bypassing US Sanctions.

So when you have a overseas citizenship via investment, especially in the Caribbean (et al) as an American you can 100% say Uncle Sam is already aware.

 

[JohnnyDoe]

wellington said:
Lot of you are forgetting one important thing.

All these investment citizenships share your information with the FBI, after pressure was plied by the US as they were extensively used for fraudulent uses, and spying or bypassing US Sanctions.

So when you have an overseas citizenship via investment, especially in the Caribbean (et al) as an American you can 100% say Uncle Sam is already aware.
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100%
Ergo: these passports are only good if your real one (yes, that's how it should be called) doesn't allow visa free travel to certain countries, and you are too lazy to obtain a visa every time you want to travel there.
In all other cases, they make more harm than good.

Sometimes it's hard to convince people that they are being scammed stupi#21
On the other hand, good job St. Kitts, Dominica etc, you managed to make people aware of your existence and earn money at the same time thu&¤#

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[Nigital Domad]

Other than law enforcement issues (my understanding is that law enforcement in most nations typically do not get involved in tax issues unless the tax authorities seek help - which would mean the tax authority needs to first know there is an issue) can you foresee any other problems?

 

[daniels27]

wellington said:
Lot of you are forgetting one important thing.

All these investment citizenships share your information with the FBI, after pressure was plied by the US as they were extensively used for fraudulent uses, and spying or bypassing US Sanctions.

So when you have a overseas citizenship via investment, especially in the Caribbean (et al) as an American you can 100% say Uncle Sam is already aware.
Click to expand...

@JohnnyDoe I found this during my archeological browsing, I think this is exactly what you and @wellington haven been warning about and the living proof, they get all data immediately:
[COLOR=#82b1ff] P [/COLOR]

Thread 'US bank closures after second passport citizenship by investment'​

May 18, 2022
Hello, I'm a US citizen and obtained a Dominica passport three months ago via citizenship by investment (for work purposes). About two weeks after I received the Dominica naturalization paperwork, the US border control revoked my Global Entry. And in the three months since, two banks / brokers have closed all my accounts with them. They send vague letters in the mail that they've made a "business decision". When I call in they won't disclose any other reason. Is this somehow linked to me having obtained a second citizenship and passport? Anyone else have a similar experience? Or obtained a...

• puf3

And apart form that if you are willing to spend some time in a country, there are many that will give you a passport after 3 to 5 years.

 

[Meta]

Nigital Domad said:
Other than law enforcement issues (my understanding is that law enforcement in most nations typically do not get involved in tax issues unless the tax authorities seek help - which would mean the tax authority needs to first know there is an issue) can you foresee any other problems?
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1) When filling forms your client will probably have to tick a "Are you US person?" box. Providing false info may be illegal in some jurisdictions and certainly may lead to a frozen account if the bank has suspicions.
2) I think good portion of larger banks will presume that a person from place like Saint Kitts has some other passport (US or not). Maybe the question would surface not at the time of account opening, but after a sizeable transaction etc.
3) "Keeping US and non-US financial lives segregated" is a real hassle.

I would say he should expect to be called out sooner or later. We are talking about decades of his active economic life. A single bank which suspects that they may have violated FACTA (serious penalties for them), and demanding birth certificate holding money hostage will be enough. Then reporting to USA. I would not recommend that.

Maybe open accounts with second passport so he can use all the financial institutions not catering to Americans, but still declare them to US and pay taxes on that?

 

[wellington]

Roger ver did it the legal way - now looking at 109 yrs in prison

 

[Nigital Domad]

Meta said:
1) When filling forms your client will probably have to tick a "Are you US person?" box. Providing false info may be illegal in some jurisdictions and certainly may lead to a frozen account if the bank has suspicions.
2) I think good portion of larger banks will presume that a person from place like Saint Kitts has some other passport (US or not). Maybe the question would surface not at the time of account opening, but after a sizeable transaction etc.
3) "Keeping US and non-US financial lives segregated" is a real hassle.

I would say he should expect to be called out sooner or later. We are talking about decades of his active economic life. A single bank which suspects that they may have violated FACTA (serious penalties for them), and demanding birth certificate holding money hostage will be enough. Then reporting to USA. I would not recommend that.

Maybe open accounts with second passport so he can use all the financial institutions not catering to Americans, but still declare them to US and pay taxes on that?
Click to expand...

Would you suggest then he only utilize smaller national / regional / EMI banks who do not allow US clients (I assume they do not have to deal with hassle of Facte?)

 

[Meta]

Nigital Domad said:
Would you suggest then he only utilize smaller national / regional / EMI banks who do not allow US clients (I assume they do not have to deal with hassle of Facte?)
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Yep, should be easier, but still. I have two citizenships and decided that it's not possible to conceal one all the time. Sometimes it works, sometimes it does not. I would suggest him to not try this - as one mistake will land him into hot water.

 

[Nigital Domad]

Meta said:
Yep, should be easier, but still. I have two citizenships and decided that it's not possible to conceal one all the time. Sometimes it works, sometimes it does not. I would suggest him to not try this - as one mistake will land him into hot water.
Click to expand...

When you say "it does not work sometimes", can you tell me what kind of hurdles you run into? Who calls you out or makes trouble, and what triggers this?

 

[Meta]

I have Russian passport and got Turkish one. Place of birth is "RUSIA", surname is very Russian-sounding. I look more Russian than Turkish obviously to anybody who deals with this nationalities.

So sometimes I go to a bank, give them Turkish passport and that's it, all fine.
Sometimes I go to a bank, give them Turkish passport and get confused stare: "Oh, I thought you were Russian, and place of birth, hmm, you have two passports right? We will need both"

Further you go geographically, less trouble.

 

[Nigital Domad]

I'm sorry to hear that. I still don't understand why the US is so worried about Russians having second passports. Other than the super rich one's who can buy whatever other identities they want anyway, wouldn't any Russian getting a second passport be looking to LEAVE Russia at this point (given how authoritarian it has become?) I just don't understand the persecution of all the good Russians trying to leave these days.

 

[anotherone]

Nigital Domad said:
Hello friends - I have a US client with a second citizenship through one of those tax haven island citizen investment programmes. He has a whole other life already set up on that island (residence, utility bills, phone, etc.)
He asked me if I see any downside to him using ONLY his non-US citizenship to open new financial accounts around the world from now on (EMI, Crypto, banks, etc.) This would allow him to not have to deal with pesky Factah and similar issues since any CRS reporting would only go back to his island nation tax authorities (which does not care about income earned offshore).
Only his US and non-US name would be the same (are names even used as unique identifiers if all other information (tax ID, address, nationality, etc.) is different?)
Other than the hassle of him having to keep his US and non-US financial lives strictly segregated for tax purposes at all times in the future, does anyone see a problem with this approach?
Click to expand...

I opened many coporate bank accounts in Europe. In the questionnaire, the bank always asks if you are a US citizen. If you say no, your file is not reported to the US authorities in the context of FATCA. So, the US would need to have access to all bank accounts from all over the world to match one of their citizens with a bank account holder. It is impossible.

If your name is john smith and you come from let's say california, there is maybe a John smith living in Poland.
Noone asked me if I had a second nationality. How could they know?

Last edited: Feb 4, 2025