Dutch MPs call for action on accidental American bank accounts

This has been going on for a couple of years, and banks and governments alike have turned it into a waiting game of sorts. It's a horrid, yet fascinating bit of injustice and systematic failure that really shouldn't occur between developed countries with friendly relations, but yet it does, and nobody seems capable of stopping it.

Here's what happens. If you are born in the US, then you are American. End of story. One Dutch account that made the news tells of a retired pilot whose father served as a liaisons officer in the US. His mother, pregnant with him, followed her husband there, and delivered the baby in Patterson Army Hospital in Fort Monmouth, New Jersey. After a year the family returned to the Netherlands. He simply grew up never realizing his dual-nationality.

So this man holds the Dutch nationality, and has paid taxes in the Netherlands all of his adult life. He built up a pension, and was ready to enjoy retirement when in 2018 the American FATCA law meant that his Dutch bank told him he could no longer be a customer there, unless he paid his taxes in the US as well. Along with the surprise that he was apparently American as well as Dutch, this would mean requesting a Tax Identification Number (TIN), and filing taxes over the years he didn't pay taxes in the US (despite never earning a dollar there and paying his Dutch taxes). He has no US social security number, nor a US passport.

Of course, because of his age — being born a long time before 1986 — requesting the TIN means supplying the birth certificate he hasn't got. And getting a US birth certificate requires a US address (which he can't acquire), and… a TIN.

Refusal to do so means no bank account, with any Dutch (or European) bank, because all of them do business in the US and must adhere to FATCA or face huge fines and exclusion from global payment networks. Denouncing his US nationality (which he never knew he had until 2018), means supplying a bunch of papers, paying €2,350, and filing taxes for the past five years (which he already paid as a Dutch citizen). Without a bank account, which incidentally is a basic right in the Netherlands, which the banks choose to ignore because of the fines, it is very hard to exist here. His pension isn't gone of course: his pension fund was preparing a bulk cash pay out instead for him to stick under his mattress.

This has been going on for years (in all of Europe), but the end of November was a strict deadline for the banks, which under political pressure turned a bit less strict, so now the banks have granted a stay of execution for the customers who have now begun to sort out their affairs (i.e., file taxes in the US). The option to refuse to pay taxes in a country you've never been to and keep a Dutch bank account does not seem to exist, and the IRS is probably the only actor in this whole sordid affair who can solve this, but seemingly refuses to do so because, hey, who cares about a few foreigners caught in a bureaucratic nightmare?

I wonder how (or if) this will be resolved in the end. It's a shameful display of political ineptness in any case though.