Court Attack On FATCA Fails

By and on April 28, 2016

Senator Rand Paul (R-KY) and six other plaintiffs’ efforts to challenge parts of the Foreign Account Tax Compliance Act (FATCA) were thwarted when the US District Court for the Southern District of Ohio dismissed their claims for lack of standing. Crawford v. Dep’t of Treasury, S.D. Ohio, US District Court for the Southern District of Ohio No. 3:15-cv-00250, (April 26, 2016). A copy of the ruling can be accessed online.

Senator Paul based his legal standing on his role as a US Senator, arguing a loss of political power as his injury. The court held Senator Paul did not have standing to litigate his claim because he had not alleged an injury to himself and that the “institutional injury he alleges is wholly abstract and widely dispersed.” The court noted that “[a] legislator does not hold any legally protected interest in proper application of the law that is distinct from the interest held by every member of the public.”

The court also found that another plaintiff did not have standing because his ability to sue could not be based on an injury caused by third parties. This plaintiff argued that because of the FATCA requirements, his brokerage firm refused to work with American clients. He also argued that he was uncomfortable with the reporting requirements and feared the “unconstitutionally excessive fines” if he willfully failed to file a “Report of Foreign Bank and Financial Accounts” or FBAR.

The remaining plaintiffs made similar arguments that the court refused to sustain.

K. Christy Vouri-Misso
  K. Christy Vouri-Misso focuses her practice on all stages of complex federal tax controversies including Internal Revenue Service (IRS) examinations, administrative appeals, voluntary disclosures, and litigation. She has settled multiple tax disputes with IRS legal counsel avoiding costly litigation in court. Read K. Christy Vouri-Misso's full bio.


Kevin Spencer
Kevin Spencer focuses his practice on tax controversy issues. Kevin represents clients in complicated tax disputes in court and before the Internal Revenue Service (IRS) at the IRS Appeals and Examination divisions. In addition to his tax controversy practice, Kevin has broad experience advising clients on various tax issues, including tax accounting, employment and reasonable compensation, civil and criminal tax penalties, IRS procedures, reportable transactions and tax shelters, renewable energy, state and local tax, and private client matters. After earning his Master of Tax degree, Kevin had the privilege to clerk for the Honorable Robert P. Ruwe on the US Tax Court. Read Kevin Spencer's full bio.

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