Superlawyer Jim Bopp takes on McCain-backed tax act that targets Americans overseas

by Sparta on May 9, 2014

in Arizona, FATCA (Foreign Account Tax Compliance Act), James George Jatras (team member), U.S. Senate and Congress, U.S. Supreme Court

Washington Times has the story:

Jim Bopp, the hard-charging lawyer who persuaded the Supreme Court to strike down crucial elements in the McCain-Feingold campaign finance law, has a new target in his legal sights: a bank and taxation statute that hits Americans overseas.

Mr. Bopp is assembling a legal attack on the Foreign Account Tax Compliance Act, which he and other critics say intrudes on financial privacy and scares banks from doing business with Americans living overseas.

“The U.S. Constitution protects every citizen’s liberty and freedom, while FATCA undermines both,” Mr. Bopp told The Washington Times. “This astonishingly bad law manages to thumb its nose at the Constitution.”

His legal challenge once again will put him on the opposite side of Republican John McCain, the long-serving senator from Arizona who was one of the two key sponsors — along with then-Sen. Russ Feingold, Wisconsin Democrat — of the campaign finance limits that Mr. Bopp defeated before the Supreme Court in 2010.

In addition to his authorship of the McCain-Feingold law, Mr. McCain was one of the main proponents of the tax compliance act, which takes full effect July 1 — unless courts intervene.

Mr. McCain is the ranking Republican on the Senate Armed Services Committee’s permanent subcommittee on investigations, headed by Sen. Carl Levin, Michigan Democrat. Mr. McCain, always on the lookout for ways to foil tax cheaters, sees another important role for the compliance act — as a foreign policy tool.

On April 29, Mr. McCain and Mr. Levin co-signed a letter urging Treasury Secretary Jack Lew to punish Russia if it does not enforce the tax compliance law.

“FATCA sanctions provide a powerful, nonmilitary option that, when added to the other financial sanctions already imposed, could help deter Russia from continuing its threatening actions against Ukraine,” the senators wrote.

Foreign policy aside, the law has real-life implications for the 7.6 million Americans who the State Department says are living and working abroad. The tax compliance act will require all banks in numerous countries to gather and report to the U.S. government full information on those Americans’ earnings, deposits, transfers and cash on hand.

The goal of the law, its proponents say, is to cut down on tax cheats who have hidden income in foreign banks. But the pragmatic effect, critics warn, is to scare foreign banks from doing business with Americans overseas because they don’t want to deal with the bureaucratic red tape.

“McCain seems to think that all Americans abroad are tax cheats, when in fact they aren’t, and their work overseas is vital to our economy by promoting the sale of our products around the world,” Mr. Bopp said.

Mr. McCain’s office did not respond to telephone and email requests from The Times for comments from him or his staff about the law and about Mr. Bopp’s planned legal attack.

Though vastly different issues, the court case against the campaign finance regulations and the case against the tax compliance law provide a common political backdrop for Mr. Bopp: Both laws were supported by a Republican and Democratic senator and have subsequently generated disdain on the left and the right.

Mr. Bopp sees in both legal fights an assault on American freedom.

In the earlier case, the Federal Election Commission used McCain-Feingold to prevent the conservative nonprofit advocacy group Citizens United from running a TV ad against Hillary Rodham Clinton during her 2008 presidential nomination race against Barack Obama.

Mr. Bopp led the initial legal assault, arguing with support from liberals and conservatives that the McCain-Feingold law infringed on the rights of nonprofits to express their opinions on election issues.

On Jan. 21, 2010, in a 5-4 decision, the Supreme Court agreed that the law violated the First Amendment. Score: Mr. Bopp 1- Mr. McCain 0.

That case, though, had less sympathetic victims in mysterious-sounding nonprofits seeking roles in elections.

The people who see themselves as victims of the tax compliance act — Americans overseas — say the law leaves them unable to establish retirement and savings accounts, acquire mortgage loans and avail themselves of other modern banking services.

Continue reading (video here)…

{ 1 comment… read it below or add one }

1 Rob in Katy May 10, 2014 at 12:47 am

Maybe after a congressman has 2 bits of legislation challenged and losing, they need to step down, and then walked around the back of the building. He has tried to extinguish more rights than the liberals.

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