Redmayne-Bentley closes door on US clients ahead of FATCA deadline
Stockbroking firm Redmayne-Bentley has stopped offering its services to US clients as it moves to comply with incoming tax regime FATCA.
With groups and wealth managers scrambling to ensure they are compliant ahead of the first significant deadline this week, Redmayne-Bentley said it has registered with the IRS, but has chosen to exclude US clients from now on.
Its existing US clients have been transferred to other firms, and the firm has taken steps to prevent US citizens accessing its services in future.
Redmayne-Bentley’s head of operations, Tim Archer, said: “We only had a small number of clients that fell into this category and, by divesting them, it allowed us to concentrate on our core market.”
Beforehand, the firm had carried out a detailed process to identify the US persons on its client list. Archer said this was the longest part of the 18-month process of preparing for FATCA, as the tax regime’s definition of a US person is very broad.
Archer described the laborious process of weeding out US clients: “We searched our own client databases in order to determine a US person, looking not only for those addressees who are resident in the US, but also linked by a US phone number, a trustee or director of a company, and even those who hold power of attorney. This meant going through a number of trust and company deeds to identify who the relevant persons were.”
Redmayne-Bentley has already registered for its Global Intermediary Identification Number (GIIN), which will ensure it appears on the IRS’ first approved list of intermediaries, published on 2 June.
FATCA, the Foreign Account Tax Compliance Act, requires foreign financial institutions to report details about their American clients to the US Internal Revenue Service to stop US citizens concealing assets and avoiding tax. The final deadline for firms to register with the IRS is 22 December.